THE Bureau of the Treasury (BTr) has postponed to January 5, 2015 the implementation of the non-restricted trading of government securities between tax-exempt and non-tax exempt entities.
In a memorandum issued on November 20, National Treasurer Rosalia de Leon moved the target live date for the implementation of the nonrestricted trading to January 5, 2015, from the previous date of November 24.
“In recognition of the market community’s request to complete activities toward market education, systems preparedness, addressing operational concerns and other preparatory activities for a smooth transition to nonrestricted trading and settlement environment, the target live date for the implementation of the subject initiative is moved to January 5, 2015,” the memorandum said.
De Leon said that the processing of documentary requirements for dealers in securities and other market participants in connection with the nonrestricted trading will also continue up to December 15.
Under the nonrestricted trading between tax-exempt and non-tax exempt entities, government securities may already be traded across tax categories.
The BTr said that this would benefit tax-exempt institutions by allowing them access to price discovery strategies enjoyed by the active taxable sector of the market.
The non-restricted trading requires the BTr to use a system approved by the Bureau of Internal Revenue (BIR) to track the tax liabilities on the transactions between tax-exempt and non-tax exempt buyers and sellers of government securities.
De Leon said that government agencies that are engaged in preparatory activities for the non-restricted trading starting on January 5, 2015 should finish these activities, such as market education and systems preparedness, by December 15, 2014.