The Securities and Exchange Commission does not proactively flag public officials who remain listed in private corporations even when such roles may raise constitutional conflict-of-interest questions, an agency official told the Senate impeachment court Monday.
During interpellation by presiding officer Francis Escudero, SEC Company Registration and Monitoring Department Director Gerardo del Rosario said the commission has no mechanism or directive requiring it to identify officials who may be prohibited from holding corporate positions or participating in business.
“Wala pong direktiba sa amin… na kinakailangan naming iulat ‘yung mga opisyal na hindi dapat magmay-ari, maging participant ng isang kompanya,” Del Rosario said September 21.
(“We have no directive requiring us to report officials who should not own or participate in a company.”)
Asked whether the SEC had investigated such corporate involvement as possible constitutional violations, Del Rosario said the agency’s regulatory mandate is focused on violations of securities and corporate laws.
The exchange came after Del Rosario confirmed that SEC records continued to list Vice President Sara Duterte as a director and shareholder of Davao-based Metro City Chow Foods Corp. after she assumed the vice presidency in 2022.
Records presented during the trial showed Duterte remained on the company’s board from 2022 to 2025 and retained a 20% stake.
Article VII, Section 13 of the Constitution prohibits the president and vice president, among other senior executive officials, from holding another office or employment or directly or indirectly participating in any business during their tenure. It also requires them to strictly avoid conflicts of interest.
The extent to which Duterte’s corporate position and shareholding violated those restrictions is among the issues House prosecutors are seeking to establish under Article II of the impeachment case.
Senator-judge Raffy Tulfo questioned why Duterte had remained involved in the corporation despite her and her husband, lawyer Manases Carpio, having legal backgrounds.
“Wala man lang ni isa sa kanila nakapag-advice sa kanya na, ‘VP, kailangan mong mag-divest kasi bawal ‘yan,'” Tulfo said.
(“Not one of them was able to advise her, ‘VP, you need to divest because that is prohibited.'”)
No dividends does not necessarily mean losses
The impeachment court also examined the finances of companies in which Duterte held business interests.
Documents presented by prosecutors showed that some companies had not declared dividends, which Del Rosario said should not automatically be interpreted to mean that they were losing money.
“Hindi naman po ibig sabihin kung walang diniklarang dibidendo ay nalulugi,” Del Rosario said.
(“The absence of declared dividends does not necessarily mean a company is losing money.”)
He explained that a corporation may choose to retain earnings for other purposes instead of distributing them to shareholders.
Del Rosario acknowledged, however, that financial statements showing negative or zero earnings could establish that a company recorded a loss for a particular year.
Records presented by the prosecution showed Metro City Chow Foods posting net losses beginning in 2020. Its 2024 audited financial statement showed about P35.1 million in revenue but a net loss of P309,860.
The company also did not declare dividends in earlier years when it had unrestricted retained earnings, according to records presented during the trial.
Monday’s proceedings formed part of the prosecution’s presentation under Article II of the impeachment complaint against Duterte.
The article covers allegations that Duterte accumulated wealth disproportionate to her lawful income, failed to truthfully disclose assets in her Statements of Assets, Liabilities and Net Worth from 2022 to 2024, and failed to divest from or continued to participate in private business interests while serving as vice president.