MORNBFI Vol. 1 - Planters Development Bank

APP. Q-1908.12.31Republic of the PhilippinesDepartment of FinanceSECURITIES AND EXCHANGE COMMISSIONSEC Building, EDSA, GreenhillsMandaluyong, Metro ManilaNEW RULES AND REGULATIONS TO IMPLEMENT THE PROVISIONS OFREPUBLIC ACT (R.A.) NO. 5980 (THE FINANCING COMPANY ACT),AS AMENDED[Appendix to Sec. 4106Q (2008 - 4656Q)]To effectively carry out the provisionsof R.A. No. 5980 (The Financing CompanyAct), as amended, the Securities andExchange Commission, pursuant to thepowers vested in it under said Act, R.A.No. 1143 and Presidential Decree No.902-A, as amended, hereby promulgatesthe following rules and regulations:Section 1. Definition of Terms. Thefollowing definition of terms shall apply forpurposes of these Rules:a. FINANCING COMPANIES arecorporations or partnerships, except thosesupervised by the Central Bank of thePhilippines, Office of the InsuranceCommissioner and the Bureau ofCooperatives Development, which areprimarily organized for the purpose ofextending credit facilities to consumers andto industrial, commercial, or agriculturalenterprises: by discounting or factoringcommercial papers or accounts receivable;by buying and selling contracts, leases,chattel mortgages, or other evidences ofindebtedness; or by leasing of motorvehicles, heavy equipment and industrialmachinery, business and office machinesand equipment, appliances and othermovable property.b. PRIMARILY ORGANIZED shallmean organized for the primary purposeof operating as a financing company andthat more than 50% of its funds shall beused or invested in financing companyactivities, Provided, That in thecomputation thereof direct loans andtemporary investments in governmentsecurities shall be taken into account.c. FUNDS as used herein shall meantotal assets inclusive of allowance fordoubtful accounts and deferred income lessinvestment in real estate, shares of stockin a real estate development corporationand real estate based projects which shallnot exceed 25% of networth of theinvesting company, leasehold rights andimprovements, fixed assets inclusive ofappraisal surplus, foreclosed properties andprepayments.d. COMMISSION shall mean theSecurities and Exchange Commission.e. CREDIT shall mean any loan,mortgage, deed of trust, advance ordiscount, any conditional sales contract, anycontract to sell, or sale or contract of sale ofproperty or service, either for present orfuture delivery, under which, part or all ofthe price is payable subsequent to themaking of such sale or contract, anyrental-purchase contract, any option,demand, lien, pledge, or other claimagainst, or for the delivery of, propertyor money, any purchase, or otheracquisition of or any credit upon thesecurity of any obligation or claim arisingout of the foregoing; and any transactionshaving a similar purpose or effect.Manual of Regulations for Non-Bank Financial InstitutionsQ RegulationsAppendix Q-19 - Page 1