By Keith Richard D. Mariano, Reporter
Posted on July 13, 2016 [ bworldonline.com
]
THE GOVERNMENT is looking to issue the
amended implementing rules and regulations (IRR) for the Real Estate Investment
Trusts (REIT), particularly adjusting the tax structure and minimum public
float requirement.
“We set three months to finish our
review and study of that IRR and probably for six months, it’s over and we have
a new one issued,” Securities and Exchange Commission (SEC) Chairperson
Teresita J. Herbosa said during the BusinessWorld Economic Forum in Taguig City
on Tuesday.
The corporate regulator will revisit the
provision concerning the minimum public free float or the portion of common
shares public investors must hold in the trust required to list on the
Philippine Stock Exchange.
“That’s the one that pertains to the
SEC, just the minimum public float. The law provides for I think at least 33%
and in the current IRR it was set at 40% to about (67%) in three years,” Ms.
Herbosa said.
The existing IRR requires REITs to have
a minimum 40% public float for the first two years of their listing. By the
third year, public investors should have already owned 67% of the trust’s
outstanding shares.
“Maybe the other issues would concern
not the SEC but the BIR (Bureau of Internal Revenue) on the tax matters,” Ms.
Herbosa noted.
In the same forum, Finance Secretary
Carlos G. Dominguez announced the Department of Finance, which supervises the
BIR, will discuss the revision of the IRR, particularly the easing of the tax
provisions, in depth starting Wednesday evening.
The existing IRR imposes a levy on the
transfer of the real assets of property developers to the REIT and 12% tax on
the additional income generated by the trust, among others.
Republic Act No. 9856 or The REIT Act
lapsed into law in December 2009. No major property developer, however, has yet
to launch such a trust, given the stringent tax and public float requirements.
“As Secretary Dominguez said, starting
[Wednesday] evening, they are already going to discuss at length this REIT
re-launch and we’re hopeful that the private sector will be genuinely
interested in availing of this law in order to raise funds and list on the
stock exchange,” Ms. Herbosa said.
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