Realizing the laws applying to financial technology firms are thoroughly outdated, the Securities and Exchange Commission said it had sought the help of the University of the Philippines Law Center for its rules to catch up with the quickly evolving industry.
What will come out from the collaboration would improve the formulation of policies that could better address the regulation of financial technology in the country.
SEC and the UPLC signed a memorandum of understanding for the conduct of joint research projects, capacity building and policy analysis, and resource and information sharing concerning fintech.
Under the partnership, the UPLC will provide aid in the creation of a legal and regulatory framework to initially address issues surrounding cryptocurrencies, before focusing on other fintech products and their corresponding regulation, according to SMC.
For its part, the commission will provide resources to help support activities that may be conducted by the UPLC regarding cryptocurrencies and fintech activities.
It will likewise recognize the state university as an official partner in the commission’s initiatives in the field.
The SEC and UPLC aim to further understand the evolving regulatory landscape surrounding fintech, for the formulation of new policies that may be applied in the Philippines
Outdated laws
“At present, we at the SEC have been making use of laws and regulations tailored for traditional securities. Although these principles were laid down in the 1930s, they are considerably effective against cryptocurrency scams that are just run-off-the-mill Ponzi schemes,” SEC chairperson Emilio B. Aquino said.
“However, we strive to serve the Filipino the best way possible — that is why we are motivated to issue rules addressing cryptocurrencies and blockchain technology, specifically for the issuance of digital assets and the regulation of digital asset exchanges.”
UP College of Law Dean Edgardo Carlo Vistan II hailed the deal as timely “especially as (key government agencies) navigate new paradigms and tackle complex challenges in these times characterized by accelerated change.”
“We commend the SEC for being proactive in addressing these challenges brought about by new technologies that enable more efficient ways of transacting business. Acting, especially, in defense of the investing public without hampering growth,” Vistan acknowledged.
The SEC has been pursuing several initiatives to address emerging technologies in the financial sector.
In 2021, the Commission established the PhiliFintech Innovation Office in order to understand and better regulate the use of fintech in the Philippines. The new office is intended to serve as the first point of contact for fintech companies applying for registration, or existing fintech companies that have been operating or are introducing new fintech products, in navigating the Commission’s regulatory landscape.