Key Developments on Stock Transaction Tax for Emperador Inc. Shares Traded on SGX-ST

Overview

Emperador Inc. (“EMI”) has issued an important update regarding the collection and payment of the Stock Transaction Tax (STT) on its shares traded on the Singapore Exchange Securities Trading Limited (SGX-ST). This update has direct implications for shareholders and market participants, as compliance with Philippine tax regulations is crucial for continued trading in EMI shares on SGX-ST.

Key Points in the Report

• Reduced STT Rate: Beginning 1 July 2025, the STT applicable to the sale of EMI shares traded on SGX-ST will be 0.1% of the gross selling price, reduced from the previous rate of 0.6%. This change follows the passage of Republic Act No. 122141, also known as the Capital Markets Efficiency Promotion Act (CMEPA).
• STT Collection and Remittance: The STT is a final tax, payable by the seller of the shares. It is collected and withheld by the seller’s Singapore broker at the date of settlement.
• Remittance Mechanism: Singapore brokers may remit the collected STT to the Philippines Bureau of Internal Revenue (BIR) either via BDO Securities Corporation (BDO)—appointed as the receiving and remitting agent by EMI—or through other channels such as their affiliated Philippine brokers.
• Brokers Onboarded for STT Remittance: A comprehensive list of major Singapore brokers has been onboarded with BDO as the Receiving Agent, including:
  • CGS-CIMB Securities (Singapore) Pte. Ltd.
  • Citigroup Global Markets Singapore Securities Ptd. Ltd.
  • CLSA Singapore Pte Ltd
  • Daiwa Capital Markets Singapore Limited
  • DBS Vickers Securities (Singapore) Pte Ltd (currently not offering EMI shares to retail clients)
  • iFAST Financial Pte Ltd
  • Instinet Singapore Services Ptd. Ltd.
  • JP Morgan Securities Singapore Private Limited
  • KGI Securities (Singapore) Pte. Ltd.
  • Lim & Tan Securities Pte Ltd
  • Macquarie Capital Securities (Singapore) Pte. Limited
  • Maybank Securities Pte. Ltd
  • OCBC Securities Pte Ltd
  • Philip Securities Pte Ltd
  • Tiger Brokers (Singapore) Pte Ltd
  • UBS Securities Pte Ltd
  • UOB Kay Hian Private Limited
• Contingency for Termination of Remittance Arrangement: If a Singapore broker ceases to use BDO as the Receiving Agent for STT remittance, or if BDO no longer acts as the agent, the broker must provide alternative STT payment methods to remain compliant with regulations. Failure to do so may result in shareholders being unable to trade EMI shares on the SGX-ST.

Important Considerations for Shareholders

• Legal Compliance: Failure by shareholders or their Singapore brokers to pay or remit the STT could result in breaches of Philippine law and/or contractual obligations.
• Potential Trading Disruption: If a broker is unable to provide an alternative STT payment method after terminating the arrangement with the Receiving Agent, shareholders trading through that broker may be unable to trade EMI shares on SGX-ST until compliance is restored.
• Additional Fees: Shareholders are advised to consult their brokers regarding any additional fees or charges that may apply in respect of STT payment.
• Share Price Sensitivity: The reduction in STT from 0.6% to 0.1% (effective July 2025) is a significant development that may enhance the trading liquidity and attractiveness of EMI shares on SGX-ST, potentially impacting share price positively. However, operational risks, such as disruptions in STT remittance arrangements, could negatively affect trading volumes and investor confidence.

Actionable Steps for Investors

1. Review the list of brokers to ensure your broker is authorized to collect and remit STT.
2. Monitor for any announcements regarding changes in the receiving and remitting agent or STT remittance procedures.
3. Consult your broker and tax adviser about the implications of STT on your trading activities and overall tax obligations.
4. Stay informed about any changes to the regulatory framework that may affect trading in EMI shares on SGX-ST.

Further Information

For more details, investors may refer to Emperador’s official website and EMI’s introductory document dated 20 June 2022. However, these are for informational purposes only and should not be construed as investment advice.

Disclaimer

This article is intended for informational purposes only and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Investors are strongly advised to seek independent professional advice regarding the tax, legal, and financial implications of trading EMI shares on SGX-ST. The information herein is based on official disclosures as of the date of this article and may be subject to change.

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