MANILA, Philippines — The Securities and Exchange Commission (SEC) is preparing to tighten oversight and disclosure requirements for private companies handling large-scale government projects.
The move comes after a group of 11 major fixed-income investors raised alarms over a lack of transparency in infrastructure spending, specifically regarding multibillion-peso flood control projects that have recently been at the center of a national graft investigation.
In late March 2026, a coalition of fund managers wrote to the SEC and the National Treasury, urging regulators to act. Their demands included:
- Use-of-Proceeds Disclosure: Requiring companies to provide detailed reports on exactly how government funds and project-related financing are being spent.
- Coordinated Oversight: Better synchronization between the SEC, the Treasury, and auditing bodies to track public funds flowing into private contractors.
- Institutional Independence: Strengthening the independence of regulatory bodies to ensure anti-corruption measures are not politically compromised.
SEC Chair Francis Lim revealed that the commission is considering a significant regulatory shift by reclassifying companies with substantial government contracts as “corporations vested with public interest.”
| Current Status | Proposed “Vested Interest” Status |
| Minimal reporting for non-listed firms. | Mandatory Corporate Governance committees. |
| Disclosure limited to basic financial statements. | Mandatory Audit committees. |
| Internal spending is private. | Periodic reporting on use of government funds (similar to IPO standards). |
SEC Commissioner Rogelio Quevedo highlighted a critical regulatory loophole: firms with very little capital winning massive state contracts.
- The “Flood Control” Problem: Quevedo noted instances where companies with only ₱1 million in capitalization were awarded government contracts worth billions.
- Sustainability Financing: The SEC is particularly concerned about the use of sustainability-linked financing for these projects, which requires even more rigorous auditing to ensure environmental and social goals are met.
The proposed reforms aim to expand the definition of “public interest” beyond just publicly listed companies or banks. By broadening this scope, the SEC can impose stricter governance and reporting standards on any private entity that manages significant public funds or large infrastructure assets.
“We welcome feedback and remain committed to upholding market integrity and investor confidence,” Chair Lim stated. The commission is currently crafting the specific criteria for this new classification, with an eye toward implementation later this year.