December 21, 2006 THE 2006 RULES OF PROCEDURE OF THE SECURITIES AND EXCHANGE COMMISSION Pursuant to the Securities

Regulation Code (R.A. 8799), Corporation Code of the Philippines (B.P. 68), Presidential ecree !o. 9"#$A, as a%ended, and other related la&s, and in the interest of a 'ust, speed( and ine)pensi*e resolution of disputes and co%plaints o*er &hich the S+C has 'urisdiction, the Co%%ission here,( pro%ulgates the follo&ing rules of procedure to go*ern actions and proceedings ,efore it. -+Sc. RULE I /eneral Pro*isions S+C0.1! 2$2. 0itle. 3 0hese Rules shall ,e 4no&n as the 50he #""6 Rules of Procedure of the Securities and +)change Co%%ission5. S+C0.1! 2$#. shall %ean7 a. efinitions. 3 6or purposes of these Rules, the follo&ing ter%s

Co%%ission 3 the Securities and +)change Co%%ission (S+C).

,. 0he Code, 0he SRC 3 the Securities Regulation Code or Repu,lic Act (R.A.) 8799. c. Co%%issioner 3 the Chairperson or an( of the Co%%issioners.

d. Co%%ission +n Banc 3 the Co%%issioners appointed pursuant to the Securities Regulation Code acting as a collegial ,od(8 it is the highest go*erning ,od( of the Co%%ission. ScaA+0 e. 1perating epart%ent 3 refers to the Co%pan( Registration and 9onitoring epart%ent (CR9 ), Co%pliance and +nforce%ent epart%ent (C+ ), Corporation 6inance epart%ent (C6 ), 9ar4et Regulation epart%ent (9R ), !on$0raditional Securities and .nstru%ents epart%ent (!0 ), and +)tension 1ffices (+1s). f. -earing Panel or 1fficer 3 an( officer, ,od( or panel dul( designated or created through the pertinent office order ,( the irector (or 1fficer$in$Charge) of an 1perating epart%ent, or ,( the Co%%ission pursuant to these Rules or ,( Resolution of the +n Banc, to hear and decide a case or co%plaint. At least one %e%,er of the hearing panel shall ,e a %e%,er of the Philippine Bar. c-C.+A g. 1rder 3 an( directi*e, other than a ecision of a -earing Panel or 1fficer.

h. ecision 3 %eans the &hole or an( part of the final disposition issued ,( a -earing Panel or 1fficer, 1perating epart%ent or the Co%%ission +n Banc pertaining to an( %atter &ithin its 'urisdiction. i. Corporation 3 also refers to a partnership, association or an( other entit( registered or licensed ,( the Co%%ission. '. 1ffice of the /eneral Accountant (1/A) 3 the office that ad*ises, assists and pro*ides technical support to the Co%%ission and S+C 1perating epart%ents on issues relating to accounting and auditing. 4. 1ffice of the /eneral Counsel (1/C) 3 the office that ad*ises and assists the Co%%ission and its irectors on legal issues that %a( ,e ,rought ,efore the%, and it %a( ,e assigned such other functions as %a( ,e delegated ,( the Co%%ission +n Banc. S+C0.1! 2$:. Construction. 3 0hese rules shall ,e li,erall( construed in order to pro%ote pu,lic interest and assist the parties in o,taining a 'ust, pro%pt, e)peditious, and ine)pensi*e resolution, settle%ent, and;or disposition of all actions ,rought ,efore the Co%%ission and to carr( out the o,'ecti*es of the la&s it is %andated to i%ple%ent. aA-.S+ 0he follo&ing rules shall ,e used in the interpretation of certain &ords and phrases found in these Rules7 (a) 5Action5 shall include an( case, co%plaint or petition filed ,( a part( ,efore the Co%%ission8 (,) 5Co%plaint5 or 5co%plainant5 shall ha*e the sa%e %eaning as 5petition5 or 5petitioner5, respecti*el(8 (c) <nless other&ise specified, the duties and responsi,ilities of a irector of an 1perating epart%ent as pro*ided for in these Rules shall li4e&ise de*ol*e upon the 1fficer$in$Charge of the said depart%ent8 +C0S a (d) 0he &ords 5he5 and 5his5 shall ,e construed as a collecti*e reference to persons and not %eant to gi*e preferential treat%ent to the %ale gender. S+C0.1! 2$=. !ature of Proceedings. 3 Su,'ect to the re>uire%ents of due process, the proceedings ,efore the Co%%ission shall ,e su%%ar( in nature and the technical rules of e*idence used in the regular courts shall, &hene*er practica,le, ,e suppletor( to these Rules. S+C0.1! 2$?. @enue of -earings. 3 As a general rule, all actions ,rought under these Rules shall ,e co%%enced and heard at the principal office of the Co%%ission in 9etro 9anila. .n cases &here it in*ol*es a corporation, the principal office of &hich is located in a place &here the Co%%ission has an e)tension office, the action or co%plaint

%a( ,e filed in the said e)tension office, pro*ided that unless specified in the ne)t follo&ing section or &hen the Co%%ission en ,anc orders other&ise, the hearing of the action shall ,e held at the principal office of the Co%%ission in 9etro 9anila. #upsec"7 S+C0.1! 2$6. Aurisdiction of 1perating epart%ents, +)tension 1ffices and Special 1ffices o*er cases filed ,efore the Co%%ission. 3 0he 1perating epart%ents, +)tension 1ffices and Special 1ffices shall ta4e 'urisdiction o*er cases in accordance &ith their respecti*e core functions. S+C0.1! 2$7. Assign%ent of Cases. 3 All actions filed &ith the Co%%ission shall ,e assigned to a hearing panel or officer dul( designated ,( the irector or 1fficer in Charge of the 1perational epart%ent &hich has 'urisdiction o*er the%, as the case %a( ,e, unless other&ise deter%ined ,( the Co%%ission +n Banc. +ScA-0 RULE II Parties S+C0.1! #$2. Bho %a( ,e Parties. 3 1nl( natural or 'uridical persons or entities authoriCed ,( la& or a part( in interest acting through an attorne($in$fact, &here applica,le, %a( ,e parties to an( action ,efore the Co%%ission. S+C0.1! #$#. Parties in .nterest. 3 All actions filed &ith the Co%%ission %ust ,e pursued and defended in the na%e of the real part( in interest. All persons &ho ha*e an interest in the su,'ect of an action and in o,taining the relief de%anded shall ,e 'oined as co%plainants. All persons &ho clai% an interest in the contro*ers(, or the su,'ect thereof &hich is ad*erse to that of the co%plainant, or is necessar( for a co%plete resolution or settle%ent of the action shall ,e 'oined as respondents. +SA-ca S+C0.1! #$:. .nter*ention. 3 A natural or 'uridical person %a(, at an( stage of the proceedings, ,e per%itted ,( the -earing Panel or 1fficer to inter*ene in an action or co%plaint if he has a legal interest therein or &hen he is so situated as to ,e ad*ersel( affected ,( the decision of the Co%%ission. 0he said part( %a( file a %otion to inter*ene or oppose the su,'ect action ,efore the -earing Panel or 1fficer stating therein the reason for his inter*ention or opposition. 0he %otion should contain all the rele*ant supporting docu%ents and, if allo&ed, shall ,e treated as a co%plaint$in$inter*ention. 0he -earing Panel or 1fficer %a( re>uire the original parties to the action to ans&er or co%%ent on the inter*ention as the case %a( &arrant or re>uire the% to su,%it their argu%ents against it in their position papers or %e%oranda prior to the su,%ission of the action for resolution. -ScA+C An ans&er to the inter*ention, &hen re>uired ,( the -earing Panel or 1fficer, should ,e filed &ithin fi*e (?) da(s fro% receipt of the corresponding order.

RULE III Co%%ence%ent of Action S+C0.1! :$2. Co%%ence%ent of Actions. 3 An action filed under these Rules shall ,e co%%enced ,( filing a *erified co%plaint &ith supporting docu%ents &ith the 1perating epart%ent that has 'urisdiction o*er the su,'ect %atter. S+C0.1! :$#. efinition of Action. 3 An action refers to the right of a part( to a*ail of the procedures pro*ided in these Rules to protect his interests and to e)pect a resolution ,ased on the facts of the case and applica,le la&s. S+C0.1! :$:. Pleadings Allo&ed. 3 0he onl( pleadings that %a( ,e filed in an( action are the co%plaint, ans&er, repl( and re'oinder, if necessar(, and %otions in inter*ention. -.0Cc S+C0.1! :$=. @erification. 3 0he co%plaint and ans&er shall ,e *erified ,( an affida*it that states that the affiant has read the co%plaint or ans&er and that the allegations therein are true and correct of his o&n personal 4no&ledge and;or ,ased on authentic records. A *erification ,ased on 5infor%ation and ,elief,5 or &hich lac4s the proper for% of *erification, shall ,e considered as i%proper and %a( cause the su%%ar( dis%issal of the co%plaint or the e)punging of the ans&er. S+C0.1! :$?. !on$6oru% Shopping. 3 0he co%plainant shall certif( under oath that7 (a) he has not co%%enced an( action or filed an( co%plaint in*ol*ing the sa%e su,'ect %atter or issues in an( court, tri,unal or agenc( and, to the ,est of his 4no&ledge, no such other action is pending therein8 (,) if there is such other pending action, a co%plete state%ent of its present status8 and (c) if he should thereafter learn that the sa%e or si%ilar action has ,een filed or is pending, he shall report that fact &ithin fi*e (?) da(s fro% such 4no&ledge to the 1perating epart%ent concerned. 6ailure to co%pl( &ith an( of the foregoing re>uire%ents shall result in the dis%issal &ithout pre'udice of the co%plaint. 0he su,%ission of a false certification or non$ co%pliance &ith an( of the underta4ings enu%erated in the preceding paragraph shall constitute indirect conte%pt of the Co%%ission and %a( gi*e rise to the i%position of ad%inistrati*e and cri%inal sanctions. .f the acts of the part( or his counsel constitute &illful foru% shopping, the sa%e shall ,e considered a 'ustifia,le ground for the su%%ar( dis%issal &ith pre'udice of the action and constitute direct conte%pt of the Co%%ission &ith the attendant ad%inistrati*e and cri%inal conse>uences. a-SA.0 S+C0.1! :$6. Prohi,ited Pleadings. 3 0he follo&ing pleadings or an( su,%ission that is filed or %ade under a si%ilar guise or title shall not ,e allo&ed7 a) ,) 9otion to is%iss 9otion for a Bill of Particulars

c) 9otion for !e& trial, Reconsideration of Audg%ent or 1rder, or Reopening of 0rial8 Ac-a0+ S.C Aa d) Petition for relief fro% 'udg%ent8

e) 9otion for e)tension of ti%e to file pleadings, affida*its, or an( other su,%ission of si%ilar intent8 f) g) h) 9otion to declare a part( in default8 9otion for postpone%ent and an( other %otions of si%ilar intent8 and 9otion for lea*e to a%end pleadings.

Should one ,e filed, said prohi,ited pleadings or su,%issions shall ,e auto%aticall( e)punged fro% the records of the case. !ot&ithstanding su,$paragraph 5g5 a,o*e, the -earing Panel or 1fficer %a(, for a co%pelling and *alid reason, reset a hearing or conference not later than ten (2") ,usiness da(s thereafter. S+C0.1! :$7. ut( of the irector of the 1perating epart%ent. 3 0he irector shall, fro% an initial e)a%ination of the allegations or a*er%ents in the co%plaint and such e*idence that %a( ,e attached to it, dis%issed the co%plaint if he finds that it is insufficient in for% and su,stance. 1ther&ise, he shall refer it to a -earing Panel or 1fficer for in*estigation or e)a%ination. .f the co%plaint has a *alid and legal ,asis, he shall issue the appropriate su%%ons to the parties concerned. All orders e%anating fro% an 1perating epart%ent under this section shall ,e under the signature of its irector or 1fficer$in$Charge, as the case %a( ,e. -S .aC S+C0.1! :$8. 6or% of Pleadings. 3 All pleadings filed shall ,e &ritten, printed or t(ped on ,ond paper in +nglish or Pilipino. +ach pleading shall contain a caption stating the na%e of the Co%%ission, the 1perating epart%ent that has 'urisdiction o*er the action, the title of the case, the case nu%,er, if an(, and a description of the pleading. 0he original and three (:) signed copies of the pleading shall ,e filed &ith the Co%%ission. All respondents shall ,e furnished &ith copies of the pleadings, e)cept the co%plaint &hich shall ,e furnished ,( the Co%%ission to the respondent as an attach%ent to the su%%ons. +)cept for the initiator( pleading, there shall ,e filed as %an( additional signed copies of the said pleadings as there %a( ,e respondents. a-0+.A

!o pleading shall ,e accepted ,( the Co%%ission unless it confor%s to the for%al re>uire%ents pro*ided for in these Rules. S+C0.1! :$9. @erified Co%plaint. 3 0he co%plaint shall contain the follo&ing infor%ation7 (a) the na%es and residences of the parties8 (,) a concise state%ent of the ulti%ate facts constituting the co%plainantDs cause(s) of action8 (c) a ,rief state%ent of the right(s) sought to ,e enforced8 (d) the la&, rule or regulation on &hich the co%plaint is ,ased8 (e) a su%%ar( of the co%plainantDs clai%s8 (f) a state%ent of the issues to ,e resol*ed8 (g) the affida*its of &itnesses, copies of docu%entar( and other pieces of e*idence8 and (h) the relief(s) sought. 0his rule not&ithstanding, the Co%%ission %a(, %otu proprio, accept and ta4e cogniCance of a co%plaint filed under a different for% in the interest of pu,lic ser*ice and social 'ustice, or to protect the in*esting pu,lic. S+C0.1! :$2". Capacit(. 3 0he facts sho&ing the capacit( of a part( to sue or ,e sued, or the authorit( of a part( to sue or ,e sued in a representati*e capacit(, or the legal e)istence of an organiCed association of persons that is %ade a part( to an action %ust ,e a*erred. A part( desiring to raise an issue on the legal e)istence of an( part( or the capacit( of an( part( to sue or ,e sued in a representati*e capacit( shall do so ,( specific denial and shall ,e supported ,( e*idence that is &ithin his 4no&ledge. 6ailure to co%pl( &ith this re>uire%ent shall ,e dee%ed a &ai*er of the right to >uestion the capacit( or authorit( of a part( to sue or ,e sued. 0.A+ac S+C0.1! :$22. Ans&er. 3 Bithin fifteen (2?) da(s fro% the ser*ice of su%%ons, the respondent shall file his ans&er to the co%plaint and ser*e a cop( thereof to the co%plainant. 0he ans&er shall contain the affida*its of &itnesses and copies of docu%entar( e*idence, if an(. S+C0.1! :$2#. +ffect of 6ailure to Ans&er. 3 .f the respondent fails to ans&er the co%plaint &ithin the a,o*estated period, he shall ,e considered as in default. 0he -earing Panel or 1fficer shall, %otu proprio, proceed to render 'udg%ent granting the co%plainant such relief as the co%plaint %a( &arrant, unless the -earing Panel or 1fficer deter%ines that the co%plainant should ,e re>uired to su,%it e) parte additional e*idence. S+C0.1! :$2:. Repl( and Re'oinder. 3 Bithin ten (2") da(s fro% the ser*ice of the ans&er, the co%plainant %a( re,ut an( ne& %atter raised in the ans&er ,( &a( of a repl(. A re'oinder to the repl( %a( ,e su,%itted ,( the respondent &ithin fi*e (?) da(s fro% receipt of the repl(. 0he repl( and re'oinder shall li4e&ise contain the affida*its of &itnesses and supporting docu%entar( e*idence, if an(. 0he -earing Panel or 1fficer %a( disallo& the filing of a repl( and re'oinder if in its;his opinion the sa%e are not necessar( under the circu%stances. -0 cC+

S+C0.1! :$2=. Affida*its, ocu%ents and 1ther +*idence. 3 0he affida*its of the partiesD respecti*e &itnesses, docu%ents, and other supporting e*idence shall ,e attached to the appropriate pleading. Supporting affida*its shall ,e %ade on personal 4no&ledge, shall set forth such facts as &ill ,e ad%issi,le in e*idence, and shall sho& affir%ati*el( that the affiant is co%petent to testif( on the %atters stated therein. S+C0.1! :$2?. oc4et 6ee. 3 A doc4et fee shall ,e assessed ,( the 1perating epart%ent concerned for an( pleading filed under these Rules in accordance &ith the Schedule of 6ees that shall for% part of these Rules, and &hich fee shall ,e paid upon the filing of the su,'ect pleading. 0+Sc. S+C0.1! :$26. Proof of Ser*ice. 3 Proof of ser*ice shall consist of a &ritten ad%ission of the part( ser*ed, or the official return of the ser*er, or the affida*it of the part( ser*ing, containing a full state%ent of the date, place and %anner of ser*ice. .f the ser*ice is ,( ordinar( %ail, proof thereof shall consist of an affida*it of the person &ho undertoo4 the %ailing of facts sho&ing co%pliance &ith section 7, Rule 2: of the Rules of Court. .f ser*ice is %ade ,( registered %ail, proof shall ,e %ade ,( such affida*it and the registr( receipt issued ,( the %ailing office. 0he registr( return card shall ,e filed i%%ediatel( upon its receipt ,( the sender, or in lieu thereof the unclai%ed letter together &ith the certified or s&orn cop( of the notice gi*en ,( the post%aster to the addressee. .f the ser*ice is ,( facsi%ile or ,( an( other electronic %eans in accordance &ith e)isting la&s, proof of ser*ice shall ,e %ade in &riting ,( the designated ser*er setting forth the %anner, place and date of ser*ice, or a &ritten ad%ission of the part( ser*ed. +aC A0 RULE IV Su%%ons S+C0.1! =$2. Su%%ons. 3 <pon the filing of the co%plaint and pa(%ent of filing fees, and deter%ination ,( the irector of the 1perating epart%entDs 'urisdiction o*er it and its sufficienc( in for% and su,stance, the proper su%%ons to the respondent shall ,e issued ,( the irector not later than ten (2") da(s fro% the date of filing of the co%plaint. S+C0.1! =$#. Contents. 3 0he su%%ons shall ,e directed to the respondent under the seal of the Co%%ission and shall contain7 a. ,. 0he na%es of the parties to the action8 An order to the respondent to ans&er &ithin the ti%e fi)ed ,( these Rules8 and

c. A notice that if the respondent fails to file its ans&er &ithin the prescri,ed period, a 'udg%ent ,( default %a( ,e rendered in fa*or of the co%plainant and the relief(s) applied for %a( ,e granted. S+C0.1! =$:. Alias Su%%ons. 3 .f the su%%ons is returned unser*ed on an( or all of the respondents or is lost, the irector at the instance of the co%plainant, %a( issue one (2) alias su%%ons in the sa%e for% as the original su%%ons. S.0+S+C0.1! =$=. B( Bho% Su%%ons 9a( Be Ser*ed. 3 0he su%%ons %a( ,e ser*ed ,( the designated ser*er of the Co%%ission. S+C0.1! =$?. Return of Su%%ons. 3 Bhen the ser*ice has ,een co%pleted, the designated ser*er shall return the su%%ons, together &ith the proof of ser*ice, to the originating 1perating epart%ent. S+C0.1! =$6. Personal Ser*ice of Su%%ons. 3 0he su%%ons shall ,e ser*ed ,( handing a cop( thereof to the respondent in person or, if he refuses to recei*e it, ,( tendering it to hi%. .f the respondent is a corporation, partnership or association, ser*ice shall ,e %ade on its president, %anaging partner, general %anager, corporate secretar(, treasurer, or in$house counsel. S+C0.1! =$7. Su,stituted Ser*ice. 3 .f, for 'ustifia,le reasons, the respondent cannot ,e ser*ed personall( &ith the su%%ons as pro*ided in the preceding section, ser*ice %a( ,e effected either (a) ,( lea*ing a cop( of the su%%ons at the respondentDs d&elling house or residence &here so%e person of suita,le age and discretion is residing, or (,) ,( lea*ing a cop( at the respondentDs principal office or regular place of ,usiness &here so%e co%petent person is in charge. 0+Aa C S+C0.1! =$8. Ser*ice <pon Pri*ate 6oreign +ntities. 3 .f the respondent is a foreign corporation doing ,usiness in the Philippines, ser*ice %a( ,e %ade on its resident agent designated in accordance &ith e)isting la& for that purpose, or, if there is no such agent, the Co%%ission shall trans%it a cop( of the su%%ons to the ho%e office of said foreign entit( ,( registered %ail, ,( facsi%ile or ,( an( other electronic %eans in accordance &ith e)isting la&s. 0he period to ans&er shall ,e thirt( (:") da(s fro% receipt of the su%%ons ,( the ho%e office, &ith the e)penses that %a( ,e incurred ,( the Co%%ission for such ser*ice paid in ad*ance ,( the parties at &hose instance the ser*ice &as %ade. S+C0.1! =$9. Ser*ice ,( Pu,lication. 3 .f the address of a respondent is un4no&n or, e*en if 4no&n, his &herea,outs cannot ,e ascertained ,( diligent in>uir(, ser*ice of su%%ons %a(, ,( lea*e of the irector of the 1perating epart%ent concerned, ,e effected on hi% ,( pu,lication of the co%plaint once in a ne&spaper of general circulation and in such places, including the Co%%issionDs &e,site (&&&.sec.go*.ph), and for such ti%e as the irector %a( order. 0he pu,lication e)penses shall ,e for the co%plainantDs account. 0.aCAc

.f the respondent does not reside or is not found in the Philippines, ser*ice %a(, ,( lea*e of the irector ,e effected out of the Philippines ,( personal ser*ice in the %anner pro*ided for in Section =$8 of these Rules8 or ,( pu,lication of the co%plaint once in a ne&spaper of general circulation in the Philippines and;or the countr( &here respondent %a( ,e found and in such places as the irector %a( order such as ,ut not li%ited to, the Co%%issionDs &e,site. A cop( of the co%plaint and the order granting such lea*e shall ,e sent ,( registered %ail to the last 4no&n address of the respondent. An( order granting such lea*e shall specif( a reasona,le ti%e &ithin &hich the respondent %ust ans&er, &hich shall not ,e less than thirt( (:") da(s fro% the date of last pu,lication, in the case of a resident &herea,outs cannot ,e ascertained8 and not less than si)t( (6") da(s fro% the date of the last pu,lication, in the case of a non$resident respondent. A-Sa0 An( application for lea*e to effect ser*ice of su%%ons ,( pu,lication shall ,e %ade ,( %otion in &riting and supported ,( an affida*it of the co%plainant or so%e person on his ,ehalf, setting forth the grounds for the application. S+C0.1! =$2". Proof of Ser*ice. 3 0he proof of ser*ice of a su%%ons shall ,e %ade in &riting ,( the designated ser*er setting forth the %anner, place and date of ser*ice. .t shall specif( the papers ser*ed &ith the su%%ons and the na%e of the person &ho recei*ed the%, and shall ,e s&orn to &hen %ade ,( a person other than the ser*er of the Co%%ission. Ser*ice ,( pu,lication on a resident respondent &hose address is un4no&n or &hose &herea,outs cannot ,e ascertained %a( ,e pro*en ,( the affida*it of the ne&spaper editor, or ,usiness;ad*ertising %anager or S+C &e,site ad%inistrator and to &hich affida*it a cop( of the pu,lication shall ,e attached. Ser*ice ,( pu,lication on a non$resident respondent %a( ,e pro*en, aside fro% the affida*it of the editor, ,usiness;ad*ertising %anager, or S+C &e,site ad%inistrator, ,( the affida*it of the ser*er stating that a cop( of the co%plaint and the order of the Co%%ission &as sent ,( registered %ail to the last 4no&n address of the respondent. C a0A. 0he respondentDs *oluntar( appearance ,efore the Co%%ission shall ,e e>ui*alent to ser*ice of su%%ons for purposes of ac>uiring 'urisdiction o*er his person, unless he %a4es an e)press reser*ation regarding on the nature of his appearance therein. RULE V Proceedings Before the -earing Panel or 1fficer S+C0.1! ?$2. Preli%inar( Conference. 3 .n an( action and upon assign%ent ,( the irector of the 1perating epart%ent concerned, the -earing Panel or 1fficer shall, in co%pliance &ith the e)isting rules on alternati*e dispute resolution, set the case for

conference &ithin ten (2") da(s after the last pleading allo&ed under Section :$2: is filed or upon e)piration of the period &ithin &hich to file the repl( or re'oinder %entioned therein. 0he parties and;or their counsels, the latter &ith the re>uisite special po&er$of$ attorne( in the a,sence of his client, shall ,e directed to appear ,efore the -earing Panel or 1fficer on the date set in the notice to consider the follo&ing actions7 a. 0he possi,ilit( of an a%ica,le settle%ent &hich includes referral to %ediation and other for%s of Alternati*e ispute Resolution (A R)8 c-a .A ,. c. 0he si%plification of the issues8 and Such other %atters that %a( aid in the 'ust and speed( disposition of the case.

0he -earing Panel or 1fficer shall ter%inate the conference stage if after t&o (#) conferences, the parties fail to settle their differences. S+C0.1! ?$#. A%ica,le Settle%ent. 3 uring the conference, the -earing Panel or 1fficer shall ensure that the parties e)haust all a*aila,le %eans to arri*e at a fair and reasona,le settle%ent of the case. 0he parties, &ith or &ithout the assistance of counsel, shall su,%it during the conference specific proposals or counter$proposals to arri*e at an a%ica,le settle%ent of the case. S -ac0 A%ica,le settle%ent shall ,e encourage at an( stage of the proceedings, pro*ided it is not pre'udicial to the pu,lic interest or third parties, or contrar( to la&, rules or regulations of the Co%%ission, or against good %orals or pu,lic polic(. 0he a%ica,le settle%ent shall ,e reduced into &riting, dul( signed ,( the parties and;or their counsels, and shall ,e the ,asis of the appropriate 1rder or ecision of the -earing Panel or 1fficer. S+C0.1! ?$:. 6ailure to Appear at the Conference. 3 0he failure of the co%plainant to appear at the conference shall result in the dis%issal of the co%plaint, unless it in*ol*es pu,lic interest &here,( the -earing Panel or 1fficer %a(, %otu proprio, reset the case for conference &ithin fi*e (?) da(s fro% receipt of proof of ser*ice of ne& su%%ons. 0he respondent &ho appears in the a,sence of the co%plainant shall ,e entitled to 'udg%ent ,ased on the facts alleged and relief(s) pra(ed for in the ans&er. .f the sole respondent fails to appear, the co%plainant shall ,e entitled to 'udg%ent in accordance &ith the i%%ediatel( preceding paragraph. -o&e*er, this rule shall not appl( if one or %ore respondents &ho ha*e ,een sued under a co%%on cause of action and &ho ha*e pleaded a co%%on defense appear at the conference. C A+-S !o other conferences, other than the circu%stance %entioned in the first paragraph of this section, shall ,e called in the e*ent an( of the parties to the action is a,sent or fails to attend the first conference called for this purpose, e)cept for *alid reasons as deter%ined ,( the -earing Panel or 1fficer.

S+C0.1! ?$=. Conference 1rder. 3 After the conference, the -earing Panel or 1fficer shall issue an 1rder stating the action ta4en during the conference, the stipulations %ade ,( the parties on an( of the %atters considered, and the e*idence the parties ha*e agreed upon. RULE VI ecision S+C0.1! 6$2. ecision. 3 0he -earing Panel or 1fficer shall decide the co%plaint &ithin thirt( (:") da(s fro% its su,%ission for resolution. 0he ecision shall contain a clear state%ent of the facts pro*en or ad%itted ,( the parties and the la& on &hich the resolution is ,ased. 0he ecision shall ,e signed ,( the irector of the 1perating epart%ent concerned and ,e ser*ed on the parties not later than ten (2") da(s after its pro%ulgation. C-c+0A S+C0.1! 6$#. 6inalit( of ecision. 3 0he ecision of the -earing Panel or 1fficer, in the a,sence of a ti%el( appeal, shall ,eco%e final and e)ecutor( upon entr( in the Boo4 of +ntr( of Audg%ent. S+C0.1! 6$:. Clarificator( Conference. 3 !ot&ithstanding the i%%ediatel( preceding section, at an( ti%e after the case has ,een su,%itted for resolution, the hearing panel;officer %a(, in his discretion, re>uire a further clarificator( e)a%ination of docu%ents, or su,%ission of additional docu%entation to ascertain factual issues pertinent and necessar( to the resolution;decision of the case. !othing herein shall ,e construed to e)tend the period for decision stated in Sec. 6$2 a,o*e. RULE VII Conte%pt S+C0.1! 7$2. irect Conte%pt. 3 0he Co%%ission or the -earing Panel or an( authoriCed officer %a( su%%aril( pass 'udg%ent on acts of direct conte%pt co%%itted in the presence of, or so near, the Chair%an or an( Co%%issioner or -earing Panel or 1fficer as to o,struct or interrupt the proceedings, including disrespect to&ards the -earing Panel or 1fficer, offensi*e acts to&ards others, and other contu%acious acts. 0hose found to ,e in direct conte%pt shall ,e punished in accordance &ith the penalties prescri,ed ,( the Rules of Court. 0he -earing Panel or 1fficer %a(, through the 1/C, re>uest the la& enforce%ent agencies of the localit( &here the hearing or in*estigation is ,eing conducted to assist in the e)ercise of this disciplinar( authorit(. -0A.c S+C0.1! 7$#. .ndirect Conte%pt. 3 0he Co%%ission or the -earing Panel or 1fficer %a(, after o,ser*ance of due process, cite or punish an( person for indirect conte%pt on an( of the grounds prescri,ed under the Re*ised Rules of Court. RULE VIII

Su,poena and Su,poena uces 0ecu% S+C0.1! 8$2. Bhen .ssued. 3 .f the attendance of a &itness or the production of specified docu%ents is necessar(, an( 1perating epart%ent or an( part( can re>uest the issuance of a su,poena or su,poena duces tecu% in the course of an( in*estigation or in an( proceeding of the Co%%ission. Pro*ided, ho&e*er, that the C+ %a(, %otu proprio, issue a su,poena pursuant to an in*estigation. Cc+-a. RULE IX Production or .nspection of ocu%ents or 0hings S+C0.1! 9$2. 9otion for Production or .nspection 1rder. 3 <pon %otion of an( part( sho&ing good cause therefor, the -earing Panel or 1fficer %a( (a) order an( part( to produce and per%it the inspection and cop(ing or photographing, ,( or on ,ehalf of the re>uesting part(, of an( designated docu%ents, papers, ,oo4s, accounts, letters, photographs, o,'ects or tangi,le things, not other&ise pri*ileged, &hich constitute or contain e*idence %aterial to an( %atter in*ol*ed in the co%plaint and are in his possession, custod( or control8 or (,) order an( part( to per%it entr( into a designated place or other propert( in his possession or control for the purpose of inspecting, %easuring, sur*e(ing, or photographing the propert( or an( designated rele*ant o,'ect of operation in the pre%ises. +c0aSC 0he order shall specif( the ti%e, place and %anner of the inspection and ta4ing of copies and photographs, and %a( prescri,e other ter%s and conditions that are 'ustified ,( the circu%stances8 Pro*ided, ho&e*er, that the re>uest for production or inspection of docu%ents or things shall ,e %ade ,efore or during the conference and onl( for docu%ents and things pre*iousl( referred to in the co%plaint, ans&er or other pertinent pleadings. RULE X Cease and esist 1rder S+C0.1! 2"$2. Bho 9a( Appl(. 3 A *erified co%plaint %a( ,e filed ,( the aggrie*ed part( &ith the Co%%ission, through the C+ , for the issuance of a Cease and esist 1rder (C 1) pursuant to the pro*isions of Section 6= of the SRC. S+C0.1! 2"$#. .ssuance of a C 1. 3 0he Co%%ission, through the 1/C, after in*estigation or *erification ,( the C+ , %otu proprio, or upon *erified co%plaint, %a( issue a C 1 &ithout the necessit( of a prior hearing if in its 'udg%ent the act or practice, unless restrained, &ill operate as a fraud on in*estors or is other&ise li4el( to cause gra*e or irrepara,le in'ur( or pre'udice to the in*esting pu,lic. .+A-c

6or other cases ho&e*er, the Co%%ission +n Banc %a( issue an order for the grant of a C 1 as it %a( dee% necessar( and &arranted in accordance &ith its po&ers under e)isting la&s. 0he C 1 shall also ,e a*aila,le in the case of anon(%ous co%plaints or ,ased on infor%ation that has co%e to its attention &hich re>uires i%%ediate action to protect the interests of the pu,lic. S+C0.1! 2"$:. Eifting of C 1. 3 A part( against &ho% a C 1 &as issued %a(, &ithin a non$e)tendi,le period of fi*e (?) ,usiness da(s fro% receipt of the order, file a for%al re>uest or %otion for the lifting thereof &ith the 1/C. Said %otion or re>uest shall ,e set for hearing ,( the 1/C not later than fifteen (2?) da(s fro% its filing and the resolution thereof shall ,e %ade not later than ten (2") da(s fro% the ter%ination of the hearing. S+C0.1! 2"$=. Bho 9a( .ssue a Pro*isional Re%ed(. 3 A pro*isional re%ed( %a( ,e issued ,( the irector of the C+ on the ,asis of his e*aluation of the issue, or upon the reco%%endation of the -earing Panel or 1fficer, as the case %a( ,e. CS- 0+ 0he Co%%ission +n Banc, ho&e*er, %a( issue an order for the grant of a C 1 as it %a( dee% necessar( and &arranted in accordance &ith its po&ers under e)isting la&s. 0he C 1 shall also ,e a*aila,le in the case of anon(%ous co%plaints or ,ased on infor%ation that has co%e to its attention &hich re>uires i%%ediate action to protect the interests of the pu,lic. S+C0.1! 2"$?. 6ailure to 6ile 9otion to Eift. 3 (a) .f the respondent fails to file a %otion to lift C 1 &ithin the prescri,ed period, the irector of the C+ %a( file &ith the Co%%ission a %otion to %a4e the C 1 per%anent, attaching thereto a draft 1rder %a4ing the C 1 per%anent. 0he 1rder shall contain the follo&ing7 i. ii. a ,rief and procedural histor( of the case8 a state%ent declaring the C 1 as per%anent8

iii. a state%ent ordering the respondent to appear ,efore the Co%%ission &ithin fifteen (2?) da(s to file its Co%%ent and to sho& cause &h( the stated penalt( should not ,e i%posed. (,) 0he Co%%ission %a( conduct hearing &ithin fifteen (2?) ,usiness da(s fro% the filing of the %otion to %a4e the C 1 per%anent. After the ter%ination of the hearing, the Co%%ission shall resol*e the %otion &ithin ten (2") ,usiness da(s. CA+0cS+C0.1! 2"$6. isse%ination of the C 1. 3 <pon the issuance of a C 1, the C+ shall (a) ser*e it on the respondent;s or an( of its authoriCed representati*es8 (,) post copies of the order at the entrance of the %ain office and;or ,ranches, if an(, of the respondent;s, and (c) post it in the Co%%issionDs .nternet &e,site. 0he C 1 %a(, as deter%ined ,( the irector of the C+ and at the discretion of the Co%%ission, ,e pu,lished in ne&spapers of general circulation or other %edia outlets.

S+C0.1! 2"$7. Auto%atic Eifting of the C 1. 3 (a) .n the e*ent that the %otion or re>uest to lift the C 1 is not resol*ed &ithin the prescri,ed period, the C 1 shall ,e auto%aticall( lifted. S+C0.1! 2"$8. Prohi,itions. 3 !o pleading, %otion or su,%ission in an( for% that %a( pre*ent the resolution of an application for a C 1 ,( the Co%%ission shall ,e entertained e)cept under Rule F.. herein. A C 1, &hen issued, shall not ,e the su,'ect of an appeal and no appeal fro% it &ill ,e entertained8 Pro*ided, ho&e*er, that an order ,( the irector of the 1perating epart%ent den(ing the %otion to lift a C 1 %a( ,e appealed to the Co%%ission +n Banc through the 1/C. -+a0S S+C0.1! 2"$9. Settle%ent 1ffers. 3 A settle%ent offer in accordance &ith Sec. ?? of the SRC and SRC Rule ??.2, shall ,e %ade in &riting and signed ,( the part( %a4ing the offer at an( stage of the proceedings, pro*ided, that no settle%ent offer shall ,e accepted after an 1rder shall ha*e ,eco%e final and e)ecutor(, pro*ided further, that if the respondent is a 'uridical person, the necessar( ,oard resolution shall also ,e attached to the offer. S+C0.1! 2"$2". Criteria for Settle%ent 1ffer. 3 (a) .n reco%%ending the appro*al or if the 1perating epart%entDs reco%%endation is unfa*ora,le ,ut the proposer so re>uests that the offer ,e presented to the Co%%ission +n Banc, the irector of the C+ , after consultation &ith the handling la&(er;tea%, shall prepare a %e%orandu% for the Co%%ission, ta4ing into consideration the follo&ing7 i. ii. iii. 0he gra*it( of the offense8 0aS.c

0he a%ount and ti%e spent ,( the Co%%ission8 0he chances of a fa*ora,le decision if the case &ere to go to trial8

i*. Bhether the respondent has pre*iousl( *iolated an( pro*ision of an( la& ,eing ad%inistered ,( the Co%%ission8 *. *i. *ii. *iii. 0he total i%posa,le penalt(8 0he da%age caused, if an(8 Bhether the settle%ent is in the pu,lic interest. 1ther pertinent %atters.

(,) !o settle%ent offer that is less than fifteen (2?G) percent of the total i%posa,le penalt( or da%age caused shall ,e accepted. c0CA . RULE XI

Appeals fro% ecisions or 1rders of 1perating epart%ents S+C0.1! 22$2. 1rdinar( Appeal. 3 An appeal to the Co%%ission +n Banc %a( ,e ta4en fro% a decision, order, or resolution issued ,( an 1perating epart%ent if there are >uestions of fact, of la&, or %i)ed >uestions of fact and la&. S+C0.1! 22$#. -o& Appeal is 0a4en. 3 Appeal %a( ,e ta4en ,( ser*ing upon the ad*erse part( and filing &ith the Co%%ission +n Banc &ithin fifteen (2?) da(s fro% notice of ecision, 1rder or Ruling, a !otice of Appeal and a 9e%orandu% on Appeal and pa(ing the corresponding doc4et fee therefor. Pro*ided, that no appeal shall ,e gi*en due course unless it includes a certification of non$filing of %ultiple petitions and co%plaints pro*ided for in Section :$? hereof. S+C0.1! 22$:. Perfection of Appeal. 3 0he appeal shall ,e dee%ed perfected upon the filing of the 9e%orandu% on Appeal and pa(%ent of the re>uired doc4et fee &ithin the period pro*ided for in these Rules. +cAS.C S+C0.1! 22$=. 9e%orandu% on Appeal8 6or% and Contents of Appeal. 3 0he 9e%orandu% on Appeal shall specif( the parties to the appeal8 designate the ecision, 1rder or Ruling or part thereof appealed fro%8 and shall indicate the %aterial dates to sho& that the appeal &as seasona,l( filed. 0he full na%es of all the parties to the proceedings shall ,e stated in the caption of the 9e%orandu% on Appeal and shall include the decision, order or ruling fro% &hich the appeal is ta4en, and, in chronological order, copies of an( such pleadings, petition, %otions and all interlocutor( orders as are related to the appealed decision, order or ruling and necessar( for the proper understanding of the issues in*ol*ed, together &ith such date as &ill sho& that the appeal &as perfected on ti%e. 0he 9e%orandu% on Appeal in se*en (7) copies shall contain a concise state%ent of facts and issues in*ol*ed, the errors assigned, the grounds relied upon for the appeal and the argu%ents in support thereof. S+C0.1! 22$?. Repl( 9e%orandu%. 3 0he appellee shall file se*en (7) copies of the repl( %e%orandu% &ith the Co%%ission +n Banc, furnishing copies thereof to the appellant &ithin ten (2") da(s fro% receipt of the 1rder to file repl( %e%orandu%. -+ CAS 6ailure to file the repl( %e%orandu% &ithin the prescri,ed period in the 1rder shall ,e construed as a &ai*er to file the sa%e. S+C0.1! 22$6. is%issal of Appeal for !on$Co%pliance. 3 0he appeal %a( ,e dis%issed ,( the Co%%ission +n Banc for failure to co%pl( &ith these Rules, or failure to perfect the appeal &ithin the prescri,ed period.

S+C0.1! 22$7. Bhen Appeal ee%ed Su,%itted for ecision. 3 <pon the filing of the repl( %e%orandu% &ith the Co%%ission +n Banc, or after the e)piration of the period to file the sa%e and no such %e%orandu% has ,een filed, the appeal shall ,e dee%ed su,%itted for decision, unless the Co%%ission +n Banc %otu propio, or upon %otion and for special reason, sets the case for oral argu%ents. S+C0.1! 22$8. Re*ie& Standard. 3 6indings of fact ,( the 1perating epart%ent shall not ,e distur,ed ,( the Co%%ission +n Banc unless serious errors of fact ha*e ,een co%%itted. c-+A0. S+C0.1! 22$9. isposition of the Appeal. 3 0he Co%%ission +n Banc %a( affir%, re*erse or %odif( the ecision, 1rder or ruling appealed fro%, or direct further proceedings to ,e ta4en thereon. !o %otion for reconsideration of the ecision of the Co%%ission +n Banc shall ,e entertained. RULE XII Petition for Re*ie& on Certiorari S+C0.1! 2#$2. Petition for Re*ie& on Certiorari. 3 Bhen an( -earing 1fficer;Panel of the Co%%ission, has acted &ithout or in e)cess of its 'urisdiction, or &ith gra*e a,use of discretion and there is no appeal, nor an( plain, speed( and ade>uate re%ed( in the ordinar( course of la&, a person aggrie*ed there,( %a( file a *erified petition &ith the Co%%ission +n Banc alleging the facts &ith certaint( and pra(ing that 'udg%ent ,e rendered annulling or %odif(ing the proceedings, order or ruling of such -earing 1fficer or Panel and granting such relief as the applica,le la&s %a( re>uire. 0he Petition shall ,e acco%panied ,( a certified true cop( of the Audg%ent, 1rder or Ruling su,'ect thereof, together &ith the copies of all pleadings and docu%ents rele*ant thereto. Pro*ided that no petition for re*ie& on certiorari shall ,e gi*en due course unless it includes a certification of non$filing of %ultiple petitions and co%plaints pro*ided for in Section :$? hereof. S+C0.1! 2#$#. Bhere Petition 6iled. 3 0he petition shall ,e filed &ith the Co%%ission +n Banc in se*en (7) copies, &ithin ten (2") da(s fro% receipt of the order or ruling su,'ect of the petition, furnishing a cop( thereof to the part( interested in sustaining the order and the -earing 1fficer;Panel &ho issued the sa%e. CS-+ca S+C0.1! 2#$:. Parties Respondent. 3 Bhen the Petition filed relates to the acts or o%ission of a -earing 1fficer of the Co%%ission, the petitioner shall 'oin, as parties respondent, the person or persons interested in sustaining the order8 and it shall ,e the dut( of such person or persons to defend the >uestioned order or ruling. S+C0.1! 2#$=. 1rder to Ans&er. 3 .f the Petition is sufficient in for% and su,stance to 'ustif( such process, the Co%%ission +n Banc shall issue an order re>uiring the respondent;s to ans&er the petition &ithin ten (2") da(s fro% receipt of a cop(

thereof. Such order shall ,e ser*ed to the respondent in such %anner as the Co%%ission +n Banc %a( direct. -0A.c S+C0.1! 2#$?. +)pediting Proceedings. 3 0he Co%%ission +n Banc %a( issue an( and all orders that shall e)pedite the proceedings. S+C0.1! 2#$6. Su%%ar( Proceedings. 3 0he proceedings ,efore the Co%%ission +n Banc shall ,e su%%ar( in nature. <pon receipt of the *erified petition, the Co%%ission +n Banc %a( either dis%iss the petition if it is not sufficient in for% and su,stance or if it is filed %anifestl( for dela( or if fro% its face there is no sho&ing that in issuing the >uestioned 1rder or Ruling, the -earing 1fficer;Panel acted &ithout or in e)cess of 'urisdiction, or &ith gra*e a,use of discretion. .t %a( re>uire the part( or parties interested in sustaining the >uestioned 1rder or Ruling, to Co%%ent or Ans&er thereon &ithin ten (2") da(s fro% notice upon the filing of &hich the petition is dee%ed su,%itted for resolution, unless the Co%%ission +n Banc sets the case for oral argu%ents. S+C0.1! 2#$7. Sta( of the Action. 3 !o petition for re*ie& or certiorari shall sta( the progress of the action in the %ain case unless the Co%%ission +n Banc orders other&ise. 0he Co%%ission +n Banc %a( also issue a status >uo 1rder for the preser*ation of the rights of the parties during the pendenc( of the proceedings. SA+.0 RULE XIII +ffecti*it( S+C0.1! 2:$2. 0ransitor( Pro*isions. 3 All %atters pending resolution ,efore the Co%%ission under other rules of procedure that ha*e ,een su,%itted for resolution at the ti%e of the appro*al of these Rules shall ,e decided under the said rules. .n all other cases, these Rules shall appl(. S+C0.1! 2:$#. Repeal and Separa,ilit(. 3 All e)isting rules, regulations or orders or an( part thereof that are inconsistent &ith these Rules are here,( repealed, a%ended or %odified accordingl(. .f an( part or pro*ision of these Rules is declared unconstitutional or illegal, the other parts or pro*isions shall re%ain *alid. S+C0.1! 2:$:. +ffecti*it(. 3 0hese Rules shall ta4e effect fifteen (2?) da(s after pu,lication in t&o (#) ne&spapers of general circulation. -.a0S ate 6iled7 27 Aanuar( #""7. Adopted7 #2 ec. #""6. (S/ .) 6+ B. BAR.! Chairperson

(S/ .) 9A. A<A!.0A +. C<+01 Co%%issioner (S/ .) A+S<S +./. 9AR0.!+H Co%%issioner (S/ .) RA<E A. PAEABR.CA Co%%issioner (S/ .) 0-A +<S +. @+!0<RA!HA Co%%issioner Cop(right #""7 C 0 e c h n o l o g i e s A s i a, . n c.

#""= ":$"=$#""= S+C Rules and Regulations on Alternati*e 0rading S(ste%