THE SECURITIES and Exchange Commission (SEC) En Banc has denied the appeal of NOW Corp., upholding an earlier P1-million fine for a securities law violation related to market disclosure.
In a regulatory filing on Monday, NOW Corp. said the SEC En Banc had issued a resolution denying its petition to reverse the regulator’s order over its disclosure, which the commission found to be misleading in relation to the alleged liability of the company’s affiliate to the government.
NOW Corp. said it intends to appeal the SEC En Banc’s decision before the Court of Appeals, adding that it is contesting the commission’s ruling.
“The foregoing incident has no impact on the financial condition and business operations of the Company since the Company intends to further appeal the decision to the appropriate appellate court,” the company said.
The issue stemmed from NOW Corp.’s regulatory filing in 2021 following a report that the government, through the National Telecommunications Commission (NTC), was seeking resolution of NOW Telecom Co., Inc.’s alleged P2.6-billion unpaid fees.
“The Securities and Exchange Commission En Banc has denied the appeal of NOW Corp. and its chairman, Mel V. Velarde, and affirmed P1-million fines each for violating securities law over a market disclosure the regulator found misleading,” the SEC said.
The company had earlier told the stock exchange that it was not a party to the Supreme Court case and had invoked the sub judice rule. NOW Corp. said it had “no knowledge of the specific details surrounding the alleged motion.”
The commission rejected NOW Corp.’s defense, saying the company’s disclosure was untenable and misleading.
“The Commission ruled that the appeal was ‘bereft of merit,’ upholding two earlier orders of its Enforcement and Investor Protection Department (EIPD) and ordering NOW Corp. and Velarde to pay the penalties,” the SEC said in a statement.
The SEC also directed the EIPD to investigate any possible liability of NOW Corp.’s other board directors to determine whether they may be held accountable in their personal capacities.
The commission noted that although the statement might have been narrowly true, it was “nonetheless delusive and calculated to be misunderstood.”
“Certainly, the public was not concerned with the procedural filing of the NTC Motion; but was concerned with the alleged P 2.6-billion liability,” it said. — Ashley Erika O. Jose