The Philippines Securities and Exchange Commission (SEC) has made plans to make sure people who invest their money are protected. They have created some rules that companies must follow to keep customers safe. These rules will cover all types of financial products and services, including digital products like cryptocurrencies.
The Philippines SEC has recently released a draft of Implementing Rules and Regulations (IRR) for public comment for the Financial Products and Services Consumer Protection Act (FCPA), which includes provisions for digital products and cryptocurrencies. The new law aims to strengthen the country’s financial regulators by providing them with rule-making, market monitoring, surveillance, inspection, and enforcement powers, with the goal of protecting the interests of financial consumers.
The SEC has also made plans to help people understand what they’re investing in. Companies will need to explain their financial products in a way that is easy for people to understand. They will also have to give customers time to think about what they’re doing before making a final decision. To simplify this, the rules will also make sure that people who give advice about investing in cryptocurrencies and other financial products have licenses and follow the rules. This way, everyone can feel confident that the advice they are getting is coming from someone who knows what they are talking about.
The guidelines outline that the SEC may conduct enforcement actions, including restrictions on excessive or unreasonable interests, fees, or charges collected by financial service providers. The SEC will also have the power to impose fines, penalties, and disgorgement, issue cease and desist orders, and suspend the operation of financial service providers.
Philippines SEC Consumer Protection
In addition, the SEC will require financial service providers to integrate a Consumer Protection Risk Management System into their enterprise-wide risk management processes and to establish a Financial Consumer Protection Assistance Mechanism for financial consumers. The draft rules will also require financial service providers to continuously evaluate their financial products or services to meet the needs and capacities of both their markets and clients. To promote clients’ full understanding of financial products, the SEC may require financial service providers to implement a clear cooling-off policy.
The SEC is also taking steps to regulate persons engaged in the business of or acting as investment advisers, requiring them to register with the Commission within 90 days of the release of the rules. The Philippines SEC will issue a separate memorandum circular on the regulation of investment advisers.