THE Securities and Exchange Commission (SEC) en banc has denied a NOW Corp. appeal and upheld a ruling imposing P1 million in fines each against the firm and its chairman, Mel Velarde, for allegedly providing misleading information to the investing public in 2021.
The SEC ruling, promulgated on Dec. 16, 2025 but released only on Monday, found the appeal “bereft of merit.” The ruling upheld two earlier orders of the regulator’s Enforcement and Investor Protection Department (EIPD) and ordered NOW and Velarde to pay the penalties.
The SEC also directed the EIPD to investigate the potential liability of other members of NOW’s board “to determine if they could be held accountable in their personal capacities,” emphasizing that the fines were “without prejudice to any subsequent findings of liability against said directors.”
The decision was issued by commissioners Javey Paul Francisco, Karlos Bello, Mcjill Bryant Fernandez and Rogelio Quevedo.
The case stems from a November 2021 disclosure issued by the company following a report that the government, through the National Telecommunications Commission (NTC), was seeking resolution of Now Telecom’s alleged P2.6 billion in unpaid fees.
In responding to a Philippine Stock Exchange (PSE) query regarding the report, NOW had said that it was “not a party to the Supreme Court case” and that it had “no knowledge of the specific details surrounding the alleged motion,” invoking the sub judice rule.
The SEC rejected that defense, calling it “a semantic evasion and collapses upon scrutiny” that was “untenable and completely misleading.”
While “literally true in a narrow sense,” the SEC said, the company’s statement was “nonetheless delusive and calculated to be misunderstood.”
“Certainly, the public was not concerned with the procedural filing of the NTC motion, but was concerned with the alleged P2.6 billion liability,” the commission said.
It emphasized that disclosure duties under the Securities Regulation Code (SRC) were “not a mere checklist” and that the substance of the disclosure was “paramount” rather than the form.
The commission described the reported P2.6-billion claim “undeniably a material fact” as Now Telecom accounts for 97.82 percent of NOW’s total assets.
The SEC deemed the November 2021 filing as “a classic material omission” and “a textbook example of a half-truth, not a pure omission,” noting that the company’s reliance on the sub judice rule was “clearly misplaced.”
NOW, through counsel, said it intended to appeal the ruling before the Court of Appeals, maintaining that it did not make an inaccurate prior disclosure.
The company emphasized that the SEC decision had no impact on its financial condition or business operations.
The SEC also clarified that Velarde’s personal liability relates to statutory responsibilities of corporate officers, and termed his claim of ignorance as “incomprehensible” given a “multi-decade, multi-billion-peso dispute threatening their primary asset.”
“When Mr. Velarde, acting for NOW Corp., made or caused the making of a misleading statement, he personally violated Section 24.1(d) of the SRC,” the commission said.
NOW shares on Monday dropped P0.03, or 4.41 percent, to close at P0.65 each amid a 0.65-percent decline for the benchmark Philippine Stock Exchange index.
