The MIC is mandated to act as the sole vehicle for the purpose of mobilizing and utilizing the MIF for investments in transactions in order to generate optimal returns on investments (ROIs), while contributing to the overall goal of reinvigorating job creation and accelerating poverty reduction by sustaining the economy’s high growth trajectory, while ensuring sustainable development.
The Maharlika Investment Corporation shall have an authorized capital stock of 500 billion pesos (approximately 8.9 billion dollars), the 375 billion pesos of which shall constitute common shares available for the subscription of the National Government, its agencies or instrumentalities, GOCCs or Government Financial Institutions (GFIs). The remaining 125 billion pesos in capital shall correspond to the preferred shares available for the subscription of the National Government, its agencies or instrumentalities, GOCCs or GFIs, and reputable private financial institutions and corporations.
Of the 375 billion pesos capital which correspond to the common shares, 125 billion pesos (or about 2.2 billion dollars) shall be initially subscribed by the National Government, and the two Government Financial Institutions (GFIs), the Land Bank of the Philippines and the Development Bank of the Philippines. The National Government shall contribute 50 billion pesos, while the Land Bank of the Philippines and the Development Bank of the Philippines shall contribute 50 billion pesos and 25 billion pesos, respectively. The contributions from the two founding GFIs shall be fully paid upon the incorporation of the MIC.
The 50 billion pesos contribution of the National Government to the initial capitalization shall be sourced from the following:
To increase the capitalization of the MIC, the Board of Directors of the MIC, upon recommendation of the Advisory Body, may request Congress for legislation to increase the capitalization of the MIC.
Yes. The MIC may issue all kinds of bonds, debentures, and securities. However, these cannot be guaranteed by the Philippine government.
As provided in Sec. 11 of the IRR, disbursements of the MIC for its administrative and operational expenses shall not exceed two percent (2%) of the funds managed. Furthermore, this ceiling shall decrease as the size of the Fund increases based on industry practice.
The MIF will initially be sourced from the capitalization of the MIC, as provided for in R.A. No. 11954. Other GFIs and GOCCs may invest into the MIF as well, subject to their respective investment and risk management strategies, and approval of their respective boards. However, government agencies and GOCCs providing for the social security and public health insurance of government employees, private sector workers and employees, and other sectors and subsectors, as specified in R.A, No. 11954 shall be absolutely prohibited from investing in the MIF
Additional investments may likewise be sourced from investments of reputable private and State-owned financial institutions and corporations, subject to the decisions of the Board of the MIC.
The following objectives of the MIF are provided in Sec. 13 of the IRR:
The following allowable investment are provided in Sec. 14 of the IRR:
There shall be nine (9) members of the Board of Directors composed as follows:
In case of a merger, consolidation, abolition, or dissolution of any of the founding GFIs, the seat in the Board of the absorbed, dissolved, or abolished GFI shall be filled by one of the next highest-ranking officers authorized by the Board of the GFI, which assumed the rights of the absorbed, dissolved, or abolished GFI.
Sec. 33 of the IRR provides that the Advisory Body shall solicit nominations and/or applications for vacancies in the PCEO, and Regular and Independent Director seats from the public and private sectors.
From the qualified nominees and applicants, the Advisory Body shall submit its list of nominees to the Office of the President not later than thirty (30) days from such vacancy.
The PCEO of the MIC, and the Regular and Independent Directors of the MIC shall be appointed by the President of the Philippines upon recommendation of the Advisory Body.
Sec. 39 of the Implementing Rules and Regulations (IRR) of the Maharlika Investment Fund Act of 2023 provides that:
“The PCEO shall direct and supervise the operations and internal administration of the MIC, and shall be charged with the risk management, financial performance, human resources, accounting and legal affairs of the MIC. The PCEO shall have the following powers and duties:
As provided in Sec. 39 of the IRR, the PCEO must have the following:
Sec. 39 of the IRR provides that the PCEO shall be appointed by the President of the Philippines, as recommended by the Advisory Body, for a term of three (3) years, without prejudice to reappointment.
As provided in Sec. 22 of the IRR,
“Regular Directors must possess the following qualifications:
- Citizen of the Philippines;
- Investment in financial assets; and
- Management of investments in the global and local markets.”
Sec. 24 of the IRR provides that the Regular Directors shall serve for a term of three (3) years.
As provided in Sec. 26 of the IRR, the Independent Directors should have “proven probity, competence, expertise and experience in finance, economics, investments, business management, or law, and are highly capable to contribute to the attainment of the objectives and purposes of the MIF.”
Moreover, Sec. 29 of the IRR provides for the additional qualifications of Regular and Independent Directors, to wit:
“Regular and Independent Directors must possess the following additional qualifications:
Under Sec. 27 of the IRR, “The Independent Directors shall be appointed by the President of the Philippines, upon the recommendation of the Advisory Body, for a term of one (1) year. The Independent Directors shall be eligible for reappointment: Provided, That the cumulative term of an Independent Director shall not exceed nine (9) years.”
Provided in Sec. 36 of the IRR are the following disqualifications of the Directors of the MIC:
“A person shall be disqualified from being a director, if within five (5) years prior to his appointment as such, the person was:
As provided in Sec. 38 of the IRR, “... the President of the Philippines may motu proprio or upon the recommendation of the Board of Directors, remove the PCEO, as well as the Regular and Independent Directors, for any of the following reasons:
Sec. 40 of the IRR provides that “The CIOO, is responsible for regular administration duties of all investment files, communicating investment strategy and policies, managing and developing a team of financial analysts and investment professionals, supervising risk management across portfolios and ensuring sound investment policies are followed.”
Sec. 40 of the IRR provides that the CIOO must have the following qualifications:
Sec. 40 of the IRR provides that the CIOO shall be appointed by the Board of Directors of the MIC.
Sec. 40 of the IRR provides that the CIOO shall be appointed for a term of three (3) years, without prejudice to reappointment.
Sec. 21 of the IRR provides that Corporate Secretary shall be responsible for the following:
Sec. 21 of the IRR provides that the Corporate Secretary should be a Filipino citizen, and a resident of the Philippines, and must possess the following qualifications:
The Advisory Body shall be composed of the following:
The MIC shall be subject to the provisions of Republic Act No. 10149, unless otherwise inconsistent with the provisions of R.A. No. 11954.
As provided in Sec. 45 of the IRR, and consistent with R.A. No. 11954, the exemptions of the MIC to the “GOCC Governance Act of 2011” include the following:
The following measures shall ensure that the credibility of the MIF will be established and maintained:
The following penalties ensure that actors with interest in the MIC who commit violations and offenses will be held accountable:
The penalties defined in the Act shall be separate and in addition to any other administrative, civil, or criminal liability under other laws.
Following the consultations of the Treasurer of the Philippines with the Founding GFIs as well as the submission of the IRR to the Office of the National Administrative Register (august 22) and the publication of the IRR in the Official Gazette on August 28th, the IRR will be promulgated on same date (August 28th).
Section 76 of the IRR provides that IRR will be effective 15 days after its complete publication in the Official Gazette or in a newspaper of general circulation.
DBP and LBP will transfer to the account of the Treasurer of the Philippines for the benefit of the MIC their contributions of P25 billion and P50 billion, respectively, within 5 days from the effectivity of the IRR. The BTr will transfer to the account of the MIC within 5 business days from receipt of the relevant MIC Board resolution. The details of the transfer from the BTr to the MIC account shall be discussed in the organizational meeting of the MIC Board.
The P50 billion NG contribution shall be deposited in the MIC designated account in accordance with the instruction of the Secretary of Finance.
Sec. 47 of the IRR provides that in order to ensure that good corporate governance is in place upon transition, the Advisory Body shall solicit nominees and applicants for PCEO, and Regular and Independent Directors in the manner provided under Sec. 33 of the IRR. The solicitation of nominees and applications, for purposes of initial appointment, may be made immediately upon the publication of the IRR, the closing date of which shall not exceed fifteen (15) days from the effectivity of the IRR.
The Advisory Body shall submit to the Office of the President the list of nominees for PCEO, Regular and Independent Directors not later than thirty (30) days from the effectivity of the IRR.
Sec. 48 of the IRR provides that upon official assumption of majority of all the members of the Board of Directors, it shall immediately convene to:
© Maharlika Fund 2023