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SEC Memorandum Circular No.14
Series of 2001
TO
: ALL CONCERNED
SUBJECT
: GUIDELINES ON THE COMPENSATION AND/OR FEES OF
MEMBERS OF MANCOM/ RECEIVERS AND LIQUIDATORS
In line with the policy of the Commission to provide
uniform/fair and reasonable compensation or fees for the comparable services
rendered by the duly designated members of the Management Committee (MANCOM),
rehabilitation receivers and liquidators in corporations or partnerships placed
under MANCOM, receivership or liquidation pursuant to Section 6 (d) of the
Presidential Decree No, 902-A, the SEC Rules on Corporate Recovery, the
Corporation Code of the Philippines, the Securities Regulation Code and other
related laws enforced by the Securities and Exchange Commission, the following
guidelines are hereby promulgated:
1. DETERMINATION
OF THE AMOUNT OF FEES TO BE ALLOWED MANCOM MEMBERS, RECEIVERS AND LIQUIDATORS.
The compensation or fees of the MANCOM, receivers and
liquidators shall be determined by the agreement between the parties and the
MANCOM members, receiver or liquidator. This compensation/fees shall be of an
amount which the corporation is willing and able to pay and the MANCOM members,
receiver or liquidator is willing to accept as fee or compensation for the
engagement of their/his service.
In case of failure of agreement, the Commission shall
determine the fees and/or compensation of MANCOM, receivers and liquidators in
accordance with the guidelines set herein.
In the determination of the compensation or fees to be
awarded to the MANCOM, the receiver or liquidator, the Commission shall issue an
order with proper notice to the interested parties for the conduct of hearing on
the subject compensation or fees. The hearing shall be conducted at least five
(5) days before the acceptance of the designation to the office by the intended
MANCOM members, receiver or liquidator.
2. BASIS
FOR THE AWARD OF COMPENSATION OR FEES.
The following shall be considered in the fixing of the
subject compensation or fees:
2.1 amount
of liabilities settled;
2.2 amount
of cash and other assets coming into the possession and control of MANCOM, receiver or liquidator;
2.3 practical
benefits derived from the MANCOM, receiver or liquidator's efforts;
2.4 attention,
time, labor and skill needed or expended in the discharge of duties measurable
in terms of common business standards;
2.5 complications
involved, the degree of activity, integrity and dispatch with which the work of
the MANCOM, receiver or liquidator are conducted;
2.6 difficulties
of conserving and administering the estate and the care and fidelity with those difficulties have been met
and
surmounted.
3. MANCOM,
Receiver or Liquidator's Fees
The MANCOM/ receiver, or liquidator shall be entitled to charge and receive for
their services, the fees as per guidelines attached as Appendix "A" to
be paid upon final liquidation or implementation of the rehabilitation plan of
the corporation or partnership, Should there be two (2) or more MANCOM members,
receivers or liquidators, the Commission shall order an equitable distribution
of the fees herein provided.
Partial
advances on fees shall only be allowed upon prior approval of the Commission. Such partial advances shall be deducted from
the fees to which the MANCOM, receiver or liquidator may be entitled upon final
liquidation or implementation of the rehabilitation plan of the corporation or
partnership. If a MANCOM member, receiver or liquidator's term is terminated
before the final settlement of the estate and a successor is appointed, the
Commission shall determine the amount of fees payable to such MANCOM member,
receiver or liquidator whose services have been terminated.
In
any event, the compensation or fees of the MANCOM, receiver or liquidator shall
not exceed four per centum (4%) of the liabilities of the corporation or
partnership settled. The said amount may be subject to reduction by agreement of
the concerned parties to the proceedings subject to the approval of the
Commission. In case the advances exceed the amount of fees to which the MANCOM,
receiver or liquidator would be entitled, the excess shall be returned by the
MANCOM, receiver or liquidator.
4. ALLOWABLE
EXPENSES
The MANCOM, receiver or liquidator shall be allowed such
expenses as may be necessary for the care, management, settlement and
liquidation of the corporation or partnership. The following expenses incurred
by the MANCOM, receiver or liquidator are allowable and/ may be subject of
reimbursement by the corporation or partnership upon the approval of the
Commission:
1.
Transportation expenses of out-of-town trips made in
the discharge of duties as MANCOM member, receiver or liquidator;
2.
Expenses for security services necessary in the
preservation of the assets of the corporation;
3.
Insurance premiums on insurance of corporate assets;
4.
Documentary stamp taxes, transfer taxes and
withholding taxes paid in relation to the management, rehabilitation or
liquidation of company assets;
5.
Cost of publication;
6.
Attorney's fees and litigation expenses in the
recovery of assets;
7.
Notarial fees;
8.
Other professional fees for those services necessary
for the implementation of the plan;
9.
Other actual expenses directly related to the
preservation, recovery, disposition and distribution of the assets as may be
determined and allowed by the Commission. Actual expenses shall exclude the
fixed overhead expenses of the MANCOM, receiver or liquidator including but not limited
to salaries and wages of their/his personnel, office rental, utilities bills,
office supplies and the like. In case of extraordinary actual expenses, such as
additional telephone bills, extra copies or the like, the same must be approved
by the Commission.
5. REPORTS
AND RELEASE OF FUNDS
The MANCOM, receiver or liquidator shall submit regular progress report on the
activities undertaken by him in the discharge of their/his function as such on
or before the last day of each month.
The report of the MANCOM, receiver or liquidator shall
contain the following:
5.1 just
and true accounts of his receipts and payments with proper vouchers verified under oath;
5.2 a
statement on whether the amounts paid to the claimants are partial payments or
represent a full settlement in which case represents the extinguishment of the
liability to such claimant with the necessary quitclaim documents;
5.3 liabilities
still to be determined;
5.4 sums
remaining in their/his possession;
5.5 proof
of notice given to all creditors named in the schedule filed by the debtor or
the MANCOM, receiver, or liquidator that said accounts will be heard at a time
specified in such notice the hearing of which should be set not less than two
nor more than eight weeks from the filing of such accounts or claims.
The MANCOM, receiver or liquidator may file a formal or written request with the
Commission for the initial release of funds, if any is available, to commence
the operations or effectively discharge the MANCOM/ receiver or liquidator
functions. Subsequent releases of funds shall be granted only upon appropriate
request for the release of funds together with the required progress report and
accounting or liquidation of funds has been filed with the Commission.
The
initial release of funds shall take into consideration the value of the assets
that came into the possession and control of the MANCOM, receiver or liquidator,
the applicable rate in the attached Appendix "A" and the length of
time allowed by law for the liquidation and settlement of the corporation or
partnership.
6. DENIAL
OF COMPENSATION OR FEES.
The MANCOM, receiver or liquidator may be denied his compensation or fees if he
forfeits or waives his right to compensation or fee or if the MANCOM or one of
its members, the receiver or liquidator is guilty of fraud, negligence,
misconduct, want of capacity or lack of appreciation of the obligations of the
office, misfeasance or reckless disregard of the performance of his duty.
This Memorandum Circular shall take effect immediately.
October 19, 2001
Mandaluyong City
LILIA
R. BAUTISTA
Chairperson
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