The Legal 500 & The In-House LawyerComparative Legal GuidePhilippines: Mergers & Acquisitions

Country Author: Franco Aristotle G. Larcina, Partner, SyCip SalazarHernandez & Gatmaitan

1. What are the key rules/laws relevant to M&A and who are the key regulatory authorities?

M&A activity is governed primarily by the Corporation Code of the Philippines (Batas Pambansa Blg. 68). In M&A transactions where any of the parties is a “public company” (i.e., a corporation with a class of equity securities listed on an exchange, or a corporation with assets in excess of Php50 Million and which has 200 or more holders each holding at least hundred 100 shares of a class of its equity securities), theSecurities Regulation Code (Republic Act No. 8799), and its Implementing Rules andRegulations, also becomes relevant (for example, the SRC sets out, among others, reporting obligations for public companies, tender offers, proxy statements and shareholder obligations to disclose ownership and transactions with respect to shares ofpublic companies). The key regulatory authority is the Securities and ExchangeCommission (SEC).

In case of high-value mergers and acquisitions, the Philippine Competition Act (Republic Act No. 10667) and its Implement Rules and Regulations may also become relevant as it provides for a merger control regime in respect of mergers and acquisitions which meet the thresholds provided under the implement rules. The Philippine Competition Commission is the regulatory body tasked with the implementation of this law.

In respect of the tax aspects of M&A activity, the principal law is the Tax Reform for Acceleration and Inclusion (Train) Law (Republic Act No. 10963).

If the M&A involves entities in regulated sectors, there may be special laws applicable to them. For example, in case of banks, the General Banking Law (Republic Act No. 8791) and the New Central Bank Act (Republic Act No. 7653); and in case of insurance companies, the Insurance Code.

2. What is the current state of the market?

M&A activity in the Philippines has been robust over the past couple of years.

3. Which market sectors have been particularly active recently?

Traditional sectors like power and energy continue to have robust M&A activities. Over the past year, we have seen increased M&A activity in financial technology, logistics, and healthcare industries.

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