RULE IX : COMPLIANCE REQUIREMENTS

Section 1. Maintenance of Prescribed Minimum Capital. - The foreign investor shall be required to maintain in the Philippines the full amount of the prescribed minimum capital, unless the foreign investor has notified the SEC and the DTI of its intention to repatriate its capital and cease operations in the Philippines.

The SEC shall establish mechanisms to monitor the actual use in Philippine operation of the inwardly remitted minimum capital requirement.

Failure to maintain the full amount of the prescribed minimum capital prior to notification of the SEC and the DTI, shall subject the foreign investor to penalties or restrictions on any future trading activities/business in the Philippines.
Sec. 2. Public Offering of Shares of Stock. – All registered retail enterprises under Categories B and C in which foreign ownership exceeds eighty percent (80%) of equity shall offer a minimum of thirty percent (30%) of their equity to the public through any stock exchange in the Philippines within eight (8) years from their start of operations. (Section 7)

Affected registered retailers shall then be required to list their shares at any stock exchange duly formed and organized under Philippine laws.

Compliance with this requirement shall be supervised and monitored by the SEC.

Sec. 3. - Promotion of Locally Manufactured Products. – For ten (10) years after the effectivity of this Act, at any given time, at least thirty percent (30%) of the aggregate cost of the stock inventory situated in the Philippines of foreign retailers falling under Categories B and C and ten percent (10%) for Category D shall be made in the Philippines.

All registered foreign retailers shall be required to maintain books of accounts showing the inventory situated in the Philippines and its origin at all times and these books may be examined at any time, by the duly authorized representative of the Department of Trade and Industry.

Furthermore, these registered foreign retailers shall be required to submit quarterly statements under oath certifying the ratio of their local and imported inventory.

Sec. 4. Visitorial Powers. – In the public interest and/or for the enforcement of any applicable law, rules and regulations, the DTI/BOI, SEC or any government office having jurisdiction on the matter may, through any of its duly authorized representatives, conduct necessary examination of records, inventory and books of accounts of the registered foreign retail enterprise in the Philippines, make pertinent inquiries from its officials and take such action as may be necessary for the proper exercise of its authority.

Sec. 5. Implementing Agency. – The monitoring and regulation of foreign sole proprietorships, partnerships, associations, or corporations allowed to engage in retail trade shall be the responsibility of the DTI. This shall include resolution of conflicts, through mediation.

Sec. 6. Withdrawal/Closure of Retail Establishments. - Applications for withdrawal or closure of retail establishments shall be filed with the Securities and Exchange Commission for corporations/partnerships/associations or the DTI, through its Regional or Provincial Offices with respect to sole proprietorships.

The DTI shall be notified by the concerned agency of actions taken on requests for withdrawal or closure of foreign retail establishments.

Sec. 7. Penalties. - Any person who shall be found guilty of violation of any provision of this Act, or its implementing rules and regulations, or other terms and conditions of its registration, shall be punished by imprisonment of not less than six (6) years and one (1) day but not more that eight (8) years, and a fine of not less than One million pesos (P1,000,000.00) but not more than Twenty million pesos (P20,000,000.00).

In the case of associations, partnerships or corporations, the penalty shall be imposed upon its partners, president, directors, manager and other officers responsible for the violation. If the offender is not a citizen of the Philippines, he shall be deported immediately after service of sentence. If the Filipino offender is a public officer of employee, he shall, in addition to the penalty prescribed herein, suffer dismissal and permanent disqualification from public office.