Drastic drop in new registrations – Biz Leaders Tackle SEC Registration Blues

Jun 8, 2018

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It’s ironic how just when the Senate approved the law on Ease of Doing Business businessmen all over the country are getting entangled in the defective Company Registration System (CRS) of the Securities and Exchange Commission.

“When we were doing manual processing of applications for new corporations locally, the applicants usually got their approved registration papers within three days,” Jesher Radaza, administrative officer of the SEC Region 10 office in Cagayan de Oro City told participants of the June 5 1st Quarter Regional Economic Situationer in Northern Mindanao hosted June 5 by the National Economic and Development Authority Region 10 office (NEDA-10).

 

“Now with applications done online with the CRS, it takes at least three weeks for the papers to be processed,” he added.

 

A local entrepreneur who requested not to be identified shared a similar sentiment.

 

“Lately, I registered a new corporation online and it took almost two months for the registration to come out,” he said. “I thought I was the only one complaining.”

 

The glitch in the CRS online registration system has been blamed for the drastic drop in the number of new firms registered in Northern Mindanao.

 

The number of stock corporations registered with SEC Region 10 office for the first quarter of 2018 declined 63% from 137 in 2017 to only 51 in 2018. Paid up capital likewise declined 54% from P135.51-million (M) in 2017 to only P62,69-M in 2017.

 

The number of new partnerships registered for the first quarter of 2018 likewise declined 39% from 26 in 2017 to only 16 in 2018. Paid up capital also dropped 59% from P147-M in 2017 to only P65.55-M in 2018.

 

Business organizations led by the Cagayan de Oro Chamber of Commerce and Industry Foundation, Inc. (Oro Chamber) had a Business Leaders’ meeting last June 7 to address this constraint. 

 

A formal letter  addressed to  SEC Chairman Emilio Aquino,  will be filed jointly by Oro Chamber, COCI, MOFCI and Promote NORMIN Foundation, emphasizing that the processing of new applications are better done at the local level.

 

The SEC launched the CRS last November 24, 2017 to expedite the online registration of new corporations 24/7. With just a valid email address, applicants can create an online CRS account and start filing registrations and complete the entire registration process online.

 

This CRS was ostensibly designed to cut registration time and red tape with applicants only required to visit the SEC office to pick up their approved registrations and submit required documents.

SEC Cagayan de Oro office (SEC photo)

 

However, the SEC claims the CRS was hacked repeatedly resulting in the delay of the processing and release of approved registrations. Although the system hurdled the Department of Information and Technology’s (DICT) vulnerability test, the hackings have slowed down the system and could have resulted in the loss of some submitted data of the applicants.

 

Earlier this year, Senator Nancy Binay asked SEC officials to consider reverting to manual registration while bugs in the CRS were ironed out.

 

An inquiry by the Senate committee on banks, financial institutions and currencies found SEC’s company registration and monitoring department admitted that the commission still has a backlog of 5,378 new applications as of February this year.

 

However, despite pressure from the Senate and the business sector to revert to manual processing while issues with the CRS are addressed, The SEC is adamant it would not return to the old system now considered obsolete.

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