"The foreign bank branch may open up to five (5) sub-branches as may be approved by the
REPUBLIC ACT NO. 10641
AN ACT ALLOWING THE FULL ENTRY OF FOREIGN BANKS IN THE
PHILIPPINES, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 7721
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
Section 1. Section 2 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 2. Modes of Entry. The Monetary Board may authorize foreign banks to operate in the
Philippine banking system through any one of the following" modes of entry: (i) by acquiring,
purchasing or owning up to one hundred percent (100%) of the voting stock of an existing
bank; (ii) by investing in up to one hundred percent (100%) of the voting stockof a new
banking subsidiary incorporated under the laws of the Philippines; or (iii) by establishing
branches with full banking authority."
Section 2. Section 3 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 3. Guidelines for Approval. In approving entry applications of foreign banks, the
Monetary Board shall: (i) ensure geographic representation and complementation; (ii) consider
strategic trade and investment relationships between the Philippines and the country of
incorporation of the foreign bank; (iii) study the demonstrated capacity, global reputation for
financial innovations and stability in a competitive environment of the applicant; (iv) see to it
that reciprocity rights are enjoyed by Philippine banks in the applicants country; and (v)
consider willingness to fully share their technology.
"Only established, reputable and financially sound foreign banks shall be allowed entry in
accordance with Section 2 of this Act. The foreign bank applicant must be widely-owned and
publicly-listed in its country of origin, unless the foreign bank applicant is owned and
controlled by the government of its country of origin.
"In the exercise of this authority, the Monetary Board shall adopt such measures as may be
necessary to ensure that the control of at least sixty percent(60%) of the resources or assets of
the entire banking system is held by domestic banks which are majority-owned by Filipinos."
Section 3. Section 4 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 4. Capital Requirements. (i) For Locally Incorporated Subsidiaries The minimum
capital required for locally incorporated subsidiaries of foreign banks shall be equal to that
prescribed by the Monetary Board for domestic banks of the same category.
"(ii) For Foreign Bank Branches Foreign banks that shall be authorized to establish
branches pursuant to Section 2(hi) of this Act shah permanently assign capital of an amount
not less than the minimum capital required for domestic banks of the same category. The
permanently assigned capital shall be inwardly remitted and converted into Philippine
currency.
Monetary Board. Locally incorporated subsidiaries of foreign banks pursuant to Section 2(h)
of this Act shall have the same branching privileges as domestic banks of the same category."
Section 4. Section 6 of Republic Act No. 7721 is hereby repealed.
Section 5. Section 8 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 8. Equal Treatment. Foreign banks authorized to operate under Section 2 of this Act,
shall perform the same functions, enjoy the same privileges, and be subject to the same
limitations imposed upon a Philippine bank of the same category. The single borrowers limit
of a foreign bank branch shall be aligned with that of a domestic bank.
"The foreign banks shall guarantee the observance of the rights of their employees under the
Constitution.
"Any right, privilege or incentive granted to foreign banks or their subsidiaries or affiliates
under this Act, shall be equally enjoyed by and extended under the same conditions to
Philippine banks."
Section 6. A new provision in Section 9 is hereby inserted in the same Act, in lieu of the
original provisions of Section 9 repealed by Section 11 of Republic Act No. 10000. Section 9
shall now read as follows:
"SEC. 9. Participation in Foreclosure Proceedings.Foreign banks which are authorized to
do banking business in the Philippines through any of the modes of entry under Section 2
hereof shall be allowed to bid and take part in foreclosure sales of real property mortgaged to
them, as well as to avail of enforcement and other proceedings, and accordingly take
possession of the mortgaged property, for a period not exceeding five (5) years from actual
possession: Provided, That in no event shall title to the property be transferred to such foreign
bank. In case said bank is the winning bidder, it shall, during the said five (5)-year period,
transfer its rights to a qualified Philippine national, without prejudice to a borrowers rights
under applicable laws. Should the bank fail to transfer such property within the five (5)-year
period, it shall be penalized one half (1/2) of one percent (1%) per annum of the price at which
the property was foreclosed until it is able to transfer the property to a qualified Philippine
national."
Section 7. Transitory Provisions. Foreign banks which are already authorized to do banking
business in the Philippines through any of the modes of entry under Section 2 hereof may
apply to change their original mode of entry.
Foreign banks operating through branches in the Philippines upon the effectivity of this Act
shall retain their original privilege upon entry to establish a limited number of sub-branches.
However, the previous restriction on the locations of such additional branches is hereby lifted.
The existing Philippine branches of foreign banks shall comply within one (1) year from the
effectivity of this Act with the minimum capital requirements as prescribed under Section 4(ii)
of this Act, unless otherwise extended by the Monetary Board.
Section 8. Section 12 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 12. Applicability of Other Banking Laws. The provisions of Republic Act No. 7653,
otherwise known as the New Central Bank Act and the provisions of Republic Act No. 8791,
otherwise known as The General Banking Law of 2000, insofar as they are applicable and not
in conflict with any provision of this Act, shall apply to banks authorized pursuant to this
Act."
Section 9. Section 13 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 13. Rule-Making Powers of the Monetary Board of the Bangko Sentral ng Pilipinas and
Compliance Reports. The Monetary Board is hereby authorized to issue such rules and
regulations as may be needed to implement "the provisions of this Act. On or before May 30
of each year, the Monetary Board shall file a written report to Congress and its respective
Banks Committees, on the developments in the implementation of this Act. The implementing
rules and regulations of this Act shall be published in at least two (2) newspapers of general
circulation."
1wphi1
Section 10. Repealing Clause. All laws, decrees, executive orders, proclamations, rules and
regulations and other issuances or parts thereof insofar as they are inconsistent with the
provisions of this Act are hereby repealed or modified accordingly.
Section 11. Effectivity. This Act shall take effect fifteen (15) days after its publication in
the Official Gazette or in at least two (2) national newspapers of general circulation.
Approved,
(Sgd.) FELICIANO BELMONTE JR. (Sgd.) FRANKLIN M. DRILON
Speaker of the House President of the Senate
House of Representatives
This Act which is a consolidation of Senate Bill No. 2159 and House Bill No. 3984 was
finally passed by the Senate and the House of Representatives on June 11, 2014 and June 10,
2014, respectively.
(Sgd.) MARILYN B. BARUA-YAP (Sgd.) OSCAR G. YABES
Secretary General Secretary of the Senate
House of Representatives
Approved: JUL 15 2014
REPUBLIC ACT No. 3765
AN ACT TO REQUIRE THE DISCLOSURE OF FINANCE CHARGES IN
CONNECTION WITH EXTENSIONS OF CREDIT.
Section 1. This Act shall be known as the "Truth in Lending Act."
Section 2. Declaration of Policy. It is hereby declared to be the policy of the State to protect
its citizens from a lack of awareness of the true cost of credit to the user by assuring a full
disclosure of such cost with a view of preventing the uninformed use of credit to the detriment
of the national economy.
Section 3. As used in this Act, the term
(1) "Board" means the Monetary Board of the Central Bank of the Philippines.
(2) "Credit" means any loan, mortgage, deed of trust, advance, or discount; any
conditional sales contract; any contract to sell, or sale or contract of sale of property
or services, either for present or future delivery, under which part or all of the price
is payable subsequent to the making of such sale or contract; any rental-purchase
contract; any contract or arrangement for the hire, bailment, or leasing of property;
any option, demand, lien, pledge, or other claim against, or for the delivery of,
property or money; any purchase, or other acquisition of, or any credit upon the
security of, any obligation of claim arising out of any of the foregoing; and any
transaction or series of transactions having a similar purpose or effect.
(3) "Finance charge" includes interest, fees, service charges, discounts, and such
other charges incident to the extension of credit as the Board may be regulation
prescribe.
(4) "Creditor" means any person engaged in the business of extending credit
(including any person who as a regular business practice make loans or sells or rents
property or services on a time, credit, or installment basis, either as principal or as
agent) who requires as an incident to the extension of credit, the payment of a
finance charge.
(5) "Person" means any individual, corporation, partnership, association, or other
organized group of persons, or the legal successor or representative of the foregoing,
and includes the Philippine Government or any agency thereof, or any other
government, or of any of its political subdivisions, or any agency of the foregoing.
Section 4. Any creditor shall furnish to each person to whom credit is extended, prior to the
consummation of the transaction, a clear statement in writing setting forth, to the extent
applicable and in accordance with rules and regulations prescribed by the Board, the following
information:

(Sgd.) BENIGNO S. AQUINO III (1) the cash price or delivered price of the property or service to be acquired;
President of the Philippines
(2) the amounts, if any, to be credited as down payment and/or trade-in;
 (3) the difference between the amounts set forth under clauses (1) and (2);
(4) the charges, individually itemized, which are paid or to be paid by such person in
connection with the transaction but which are not incident to the extension of credit;
(5) the total amount to be financed;
(6) the finance charge expressed in terms of pesos and centavos; and
(7) the percentage that the finance bears to the total amount to be financed expressed
as a simple annual rate on the outstanding unpaid balance of the obligation.
Section 5. The Board shall prescribe such rules and regulations as may be necessary or proper
in carrying out the provisions of this Act. Any rule or regulation prescribed hereunder may
contain such classifications and differentiations as in the judgment of the Board are necessary
or proper to effectuate the purposes of this Act or to prevent circumvention or evasion, or to
facilitate the enforcement of this Act, or any rule or regulation issued thereunder.
Section 6. (a) Any creditor who in connection with any credit transaction fails to disclose to
any person any information in violation of this Act or any regulation issued thereunder shall
be liable to such person in the amount of P100 or in an amount equal to twice the finance
charged required by such creditor in connection with such transaction, whichever is the
greater, except that such liability shall not exceed P2,000 on any credit transaction. Action to
recover such penalty may be brought by such person within one year from the date of the
occurrence of the violation, in any court of competent jurisdiction. In any action under this
subsection in which any person is entitled to a recovery, the creditor shall be liable for
reasonable attorney's fees and court costs as determined by the court.
(b) Except as specified in subsection (a) of this section, nothing contained in this Act
or any regulation contained in this Act or any regulation thereunder shall affect the
validity or enforceability of any contract or transactions.
(c) Any person who willfully violates any provision of this Act or any regulation
issued thereunder shall be fined by not less than P1,00 or more than P5,000 or
imprisonment for not less than 6 months, nor more than one year or both.
(d) No punishment or penalty provided by this Act shall apply to the Philippine
Government or any agency or any political subdivision thereof.
(e) A final judgment hereafter rendered in any criminal proceeding under this Act to
the effect that a defendant has willfully violated this Act shall be prima facie
evidence against such defendant in an action or proceeding brought by any other
party against such defendant under this Act as to all matters respecting which said
judgment would be an estoppel as between the parties thereto.
Section 7. This Act shall become effective upon approval.
Approved: June 22, 1963
Republic Act No. 9194 March 7, 2003
AN ACT AMENDING REPUBLIC ACT NO. 9160, OTHERWISE KNOWN AS THE
"ANTI-MONEY LAUNDERING ACT OF 2001"
Be it enacted by the Senate and House of Representative of the Philippines in Congress
assembled:
SECTION 1. Section 3, paragraph (b) of Republic Act No. 9160 is hereby amended as
follows:
"(b) 'Covered transaction' is a transaction in cash or other equivalent monetary
instrument involving a total amount in excess of Five hundred thousand pesos (PhP
500,000.00) within one (1) banking day.
SECTION 2. Section 3 of the same Act is further amended by inserting between paragraphs
(b) and (c) a new paragraph designated as (b-1) to read as follows:
"(b-1) 'Suspicious transaction' are transactions with covered institutions, regardless
of the amounts involved, where any of the following circumstances exist:
1. there is no underlying legal or trade obligation, purpose or economic justification;
2. the client is not properly identified;
3. the amount involved is not commensurate with the business or financial capacity
of the client;
4. taking into account all known circumstances, it may be perceived that the client's
transaction is structured in order to avoid being the subject of reporting requirements
under the Act;
5. any circumstances relating to the transaction which is observed to deviate from
the profile of the client and/or the client's past transactions with the covered
institution;
6. the transactions is in a way related to an unlawful activity or offense under this
Act that is about to be, is being or has been committed; or
7. any transactions that is similar or analogous to any of the foregoing."
SECTION 3. Section 3(i) of the same Act is further amended to read as follows:
"(i) 'Unlawful activity' refers to any act or omission or series or combination thereof
involving or having direct relation to following:
"(1) Kidnapping for ransom under Article 267 of Act No. 3815, otherwise known as
the Revised Penal Code, as amended;
 "(2) Sections 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, and 16 of Republic Act No. 9165,
otherwise known as the Comprehensive Dangerous Act of 2002;
"(3) Section 3 paragraphs B, C, E, G, H and I of republic Act No. 3019, as amended,
otherwise known as the Anti-Graft and Corrupt Practices Act;
"(4) Plunder under Republic Act No. 7080, as amended;
"(5) Robbery and extortion under Articles 294, 295, 296, 299, 300, 301 and 302 of
the Revised Penal Code, as amended;
"(6) Jueteng and Masiao punished as illegal gambling under Presidential Decree No.
1602;
"(7) Piracy on the high seas under the Revised Penal Code, as amended and
Presidential under the Revised Penal Code, as amended and Presidential Decree No.
532;
"(8) Qualified theft under Article 310 of the Revised penal Code, as amended;
"(9) Swindling under Article 315 of the Revised Penal Code, as amended;
"(10) Smuggling under Republic Act Nos. 455 and 1937;
"(11) Violations under Republic Act No. 8792, otherwise known as the Electrinic
Commerce Act of 2000;
"(12) Hijacking and other violations under Republic Act No. 6235; destructive arson
and murder, as defined under the Revised Penal Code, as amended, including those
perpetrated by terrorists against non-combatant persons and similar targets;
"(13) Fraudulent practices and other violations under Republic Act No. 8799,
otherwise known as the Securities Regulation Code of 2000;
"(14) Felonies or offenses of a similar nature that are punishable under the penal
laws of other countries."
SECTION 4. Section 4 of the same Act is hereby amended to read as follows:
"SEC. 4. Money Laundering Offense. -- Money laundering is a crime whereby the
proceeds of an unlawful activity as herein defined are transacted, theeby making
them appear to have originated from legitimate sources. It is committed by the
following:
(a) Any person knowing that any monetary instrument or property represents,
involves, or relates to, the proceeds of any unlawful activity, transacts or attempts to
transacts said monetary instrument or property.
(b) Any person knowing that any monetary instrument or property involves the
proceeds of any unlawful activity, performs or fails to perform any act as a result of
which he falicitates the offense of money laundering referred to in paragraph (a)
above.
(c) Any person knowing that any monetary instrument or property is required under
this Act to be disclosed and filed with the Anti-Money Laundering Council
(AMLC), fails to do so."
SECTION 5. Section 7 of the same Act is hereby amended as follows:
"SEC.7. Creation of Anti-Money Laundering Council (AMLC). -- The Anti-Money
Laundering Council is hereby created and shall be composed of the Governor of the
Bangko Sentral ng Pilipinas as chairman, the Commissioner of the Insurance
Commission and the Chairman of the Securities and Exchange Commission as
member. The AMLC shall shall act unanimously in the discharge of its functions as
defined hereunder:
"(1) to require and receive covered or suspicious transaction reports from covered
institutions;
"(2) to issue orders addressed to the appropriate Supervising Authority or the
covered institutions to determine the true identity of the owner of any monetary
instrument or preperty subject of a covered transaction or suspicious transaction
report or request for assistance from a foreign State, or believed by the Council, on
the basis fo substantial evidence, to be, in whole or in part, wherever located,
representing, involving, or related to directly or indirectly, in any manner or by any
means, the proceeds of an unlawful activitity.
"(3) to institute civil forfeiture proceedings and all other remedial proceedings
through the Office of th Solicitor General;
"(4) to cause the filing of complaints with the Department of Justice or the
Ombudsman for the prosecution of money laundering offenses;
"(5) to investigate suspicious transactions and covered transactions deemed
suspicious after an investigation by AMLC, money laundering activities and other
violations of this Act;
"(6) to apply before the Court of Appeals, ex parte, for the freezing of any monetary
instrument or property alleged to be the proceeds of any unlawful activity as defined
in Section 3(i) hereof;
"(7) to implement such measures as may be necessary and justified under this Act to
counteract money laundering;
"(8) to receive and take action in respect of, any request from foreign states for
assistance in their own anti-money laundering operations provided in this Act;
 "(9) to develop educational programs on the pernicious effects of money laundering,
the methods and techniques used in the money laundering, the viable means of
preventing money laundering and the effective ways of prosecuting and punishing
offenders;
"(10) to enlist the assistance of any branch, department, bureau, office, agency, or
instrumentality of the government, including government-owned and -controlled
corporations, in undertaking any and all anti-money laundering operations, which
may include the use of its personnel, facilities and resources for the more resolute
prevention, detection, and investigation of money laundering offenses and
prosecution of offenders; and
"(11) to impose administrative sanctions for the violation of laws, rules, regulations,
and orders and resolutions issued pursuant thereto."
SECTION 6. Section 9(c) of the same Act is hereby amended to read as follows:
"(c) Reporting of Covered and Suspicious Transactions. -- Covered institutions shall
report to the AMLC all covered transactions and suspicious transactions within
five(5) working days from occurrences thereof, unless the Supervising Authority
prescribes a longer period not exceeding ten (10) working days.
"Should a transaction be determined to be both a covered transaction and a
suspicious transaction, the covered institution shall be required to report the same as
a suspicious transaction.
"When reporting covered or suspicious transactions to the AMLC, covered
institutions and their officers and employees shall not be deemed to have violated
Republic Act No. 1405, as amended, Republic Act No. 6426, as amended, Republic
Act No. 8791 and other similar laws, but are prohibited from communicating,
directly or indirectly, in any manner or by an means, to any person, the fact that a
covered or suspicious transaction report was made, the contents thereof, or any other
information in relation thereto. In case of violation thereof, the concerned officer
and employee of the covered institution shall be criminally liable. However, no
administrative, criminal or civil proceedings, shall lie against any person for having
made a covered or suspicious transaction report in the regular performance of his
duties in good faith, whether or not such reporting results in any criminal
prosecution under this Act of any other law.
"When reporting covered or suspicious transactions to the AMLC, covered
instituting and their officers and employees are prohibited from communicating
directly or indirectly, in any manner or by any means, to any person or entity, the
media, the fact that a covered or suspicious transaction report was made, the
contents thereof, or any other information in relation thereto. Neither may such
reporting be published or aired in any manner or form by the mass media, electronic
mail, or other similar devices. In case of violation thereof, the concerned officer and
employee of the covered institution and media shall be held criminally liable.
SECTION 7. Section 10 of the same Act is hereby amended to read as follows:
"Sec 10. Freezing of Monetary Instrument or Property. -- The Court of Appeals,
upon application ex parte by the AMLC and after determination that probable cause
exists that any monetary instrument or property is in any way related to an unlawful
activity as defined in Section 3(i) hereof, may issue a freeze order which shall be
effective immediately. The freeze order shall be for a period of twenty (20) days
unless extended by the court.
SECTION 8. Section 11 of the same Act is hereby amended to read as follows:
"Sec. 11. Authority to Inquire into Bank Deposits. -- Notwithstanding the provisions
of Republic Act No. 1405, as amended, Republic Act No. 6426, as amended,
Republic Act No. 8791, and other laws, the AMLC may inquire into or examine any
particular deposit or investment with any banking institution or non-bank financial
institution upon order of any competent court in cases of violation of this Act, when
it has been established that there is probable cause that the deposits or investments
are related to an unlawful activities as defined in Section 3(I) hereof or a money
laundering offense under Section 4 hereof, except that no court order shall be
required in cases involving unlawful activities defined in Sections 3(I)1, (2) and
(12).
"To ensure compliance with this Act, the Bangko Sentral ng Pilipinas (BSP) may
inquire into or examine any deposit of investment with any banking institution or
non-bank financial institution when the examination is made in the course of a
periodic or special examination, in accordance with the rules of examination of the
BSP.
SECTION 9. Section 14, paragraphs (c) and (d) of the same Act is hereby amended to read as
follows:
"(c) Malicious Reporting. Any person who, with malice, or in bad faith, reports or
files a completely unwarranted or false information relative to money laundering
transaction against any person shall be subject to a penalty to six (6) months to four
(4) years imprisonment and a fine of not less than One hundred thousand Philippine
pesos (Php100,000.00) but not more than Five hundred thousand Philippine pesos
(Php500,000.00), at the discretion of the court: Provided, That the offender is not
entitled to avail the benefits of the Probation Law.
"If the offender is a corporation, association, partnership or any juridical person, the
penalty shall be imposed upon the responsible officers, as the case may be, who
participated in, or allowed by their gross negligence, the commission of the crime. If
the offender is a juridical person, the court may suspend or revoke its license. If the
offer is an alien, he shall, in addition to the penalties herein prescribed, be deported
without further proceedings after serving the penalties herein prescribed. If the
offender is a public official or employee, he shall, in addition to the penalties
prescribed herein, suffer perpetual or temporary absolute disqualification from
office, as the case may be.
"Any public official or employee who is called upon to testify and refuses to do the
same or purposely fails to testify shall suffer the same penalties prescribed herein.
 "(d) Breach of Confidentiality. The punishment of imprisonment ranging from three
(3) to eight (8) years and a fine of not less than Five hundred thousand Philippine
pesos (Php500,000.00) but not more than One million Philippine pesos
(Php1,000,000.00) shall be imposed on a person convicted for a violation under
Section 9(c). In the case of a breach of confidentiality that is published or reported
by media, the responsible reporter, writer, president, publisher, manager and editor-
in-chief shall be liable under this Act.

SECTION 10. Section 15 of Republic Act No. 9160 is hereby deleted.

SECTION 11. Section 23 of the same Act is hereby amended to read as follows:

"SEC. 23. Effectivity. -- This Act shall take effect fifteen (15) days after its complete
publication in the Official Gazette or in at least two (2) national newspapers of
general circulation.

SECTION 12. Transitory Provision. -- Existing freeze orders issued by the AMLC shall
remain in force for a period of thirty (30) days after the effectivity of this Act, unless extended
by the Court of Appeals.

SECTION 13. Effectivity. -- This Act shall take effect fifteen (15) days after its complete
publication in the Official Gazette or in at least two (2) national newspapers of general
circulation.

Approved,

FRANKLIN DRILON JOSE DE VENECIA JR.

President of the Senate Speaker of the House of Representatives

This Act which is a consolidation of House Bill No. 5655 and Senate Bill No. 2419 was
finally passed by the House of Representatives and the Senate on March 5, 2003.

OSCAR G. YABES ROBERTO P. NAZARENO

Secretary of Senate Secretary General
House of Represenatives

Approved: March 7, 2003

GLORIA MACAPAGAL-ARROYO
President of the Philippines