The Securities and Exchange Commission (“SEC”) issued a Notice dated 11 September 2026, requesting for comments on the Proposed Amendments to SEC Memorandum Circular No. 14, Series of 2019, otherwise known as the Rules and Regulations Governing Crowdfunding (“Proposed Amendments”). Comments may be sent on or before 20 September 2026 via email to ipsd_msrd@sec.gov.ph.
The Proposed Amendments provide a significantly more detailed regulatory framework for crowdfunding, expanding on investor protection and compliance scope, narrower eligibility to become crowdfunding intermediaries, higher compliance thresholds, and increased operational rigor.
Among the notable proposed changes are as follows:
- Fundraising caps exemption from registration of securities are proposed to be increased (i) from PhP10 Million to PhP25 Million for any investor and (ii) from “more than PhP10 Million but not exceeding PhP50 Million” to “more than PhP25 Million but not exceeding PhP100 Million” for qualified investors. Further, the list of qualified investors is being expanded to include registered securities dealers; discretionary broker-managed accounts; fund managers regulated by the Bangko Sentral ng Pilipinas and the SEC, such as government or private provident and pension funds, trust corporations, unit investment trust funds; funds covered by a trust or investment management account agreement, whether discretionary or, if non-discretionary, the beneficial owners meet the qualifications on financial capacity and sophistication or conferred as a Qualified Buyer under the SRC; quasi-banks; pre-need companies; authorized collective investment schemes; entities listed in the Philippine Stock Exchange that engages professional fund managers; foreign entities that would be covered by the foregoing if established in the Philippines; and other person as the SEC may determine to be a Qualified Buyer.
- Only registered broker-dealers and registered investment houses will be eligible to act as a Crowdfunding Intermediary under the Proposed Amendments. Funding portals, previously recognized as eligible to act as an intermediary in crowdfunding transactions, and other entities (such as technology service providers that merely provide infrastructure, software, or system, communication infrastructure operators that merely enables routed orders, financial portal operators that aggregate content and provide links to financial information sites, and operators of facilities that provides information on securities that are not reasonably expected to be sold based solely on the information), will not be eligible.
- The requirement that the Lead Person must be the chief executive or any person primarily responsible for the operations and financial management has been removed from the Proposed Amendments.
- Expansion of the conflicts of interest framework, including prohibition of the crowdfunding intermediary from admitting, facilitating, hosting, or offering its crowdfunding platform to any person who owns or controls 20% of the outstanding capital stock or voting rights in the Crowdfunding Intermediary; directors, trustees, officers, partners, key management personnel, employees, or associated persons of the Crowdfunding Intermediary; parent, subsidiary, affiliate, or other similar entities of the Crowdfunding Intermediary; any entity which any of the foregoing holds 20% or more of the outstanding capital stock; or any person or entity who may reasonably give rise to an actual, potential, or apparent conflict of interest, as may be determined by the SEC.
- Crowdfunding Intermediaries will also be required to maintain and review their policies and internal controls relating to conflicts of interest, take all reasonable measures to prevent conflicts of interest, establish and manage appropriate safeguards in the event that conflicts arise, and disclose on its Crowdfunding Platform the general nature and sources of actual or potential conflicts that may arise in connection with the crowdfunding services it provides.
- Expansion of matters for review before permitting an issuer to raise funds, compared to the previous rules which simply advises a Crowdfunding Intermediary to conduct background checks, verify the business proposition, and assess the creditworthiness of the prospective issuer. Relatedly, the Proposed Amendment also prescribe a set list of matters that must be reported by issuers and disclosed to all investors, including any change to the Crowdfunding Intermediary’s company details, business model and activities, and ownership and control.
- Introduction of a formal procedure for the withdrawal of business or cancellation of registration of crowdfunding intermediaries, including the filing of a written request for withdrawal or cancellation with the SEC, the submission of a Cessation and Transition Plan, notice to investors, issuers, and other affected persons, the treatment of the ongoing offerings, the submission of a final report and certification to the SEC, and the continuing obligations of Crowdfunding Intermediaries after the withdrawal or cancellation.
A full copy of the notice and the Proposed Amendments may be accessed through this link.
For further information, please contact:
Fernand Joseph D. Miranda, Partner, Cruz Marcelo & Tenefrancia
fd.miranda@cruzmarcelo.com
