PSE lauds new rules for financially distressed companies
THE PHILIPPINE STOCK EXCHANGE (PSE) welcomes the approval by the Supreme Court of the 2008 Rules of Procedure on Corporate Rehabilitation which replaces the Interim Rules of Procedure on Corporate Rehabilitation approved by the Supreme Court way back in 2000.
The new rules will take effect January 16, 2009. The new rules seek to improve and expedite the court procedures for petitions for rehabilitation or re-organizations of corporations, partnerships and associations in order to help debtors recover from financial difficulties while at the same time attempting to ensure fair treatment of creditors.
Mr. Francis Lim, PSE president and chief executive officer, expressed elation over this development. “The passage of the new rules is perfectly timed as some of our companies may encounter financial difficulties as a result of the ongoing global recession. It is therefore important that our bankruptcy system is ready to help our companies get back on their feet if they find themselves in such a situation,” Mr. Lim said.
“The new rules will be the counterpart of Chapter 11 proceedings in the United States pending passage by Congress of a more comprehensive bankruptcy law to replace our 1909 Insolvency Act,” Mr. Lim said further. Congress has been working on the Corporate Recovery and Insolvency Act or CRIA, which is one of the capital market-related laws being advocated by the PSE.