February 18, 2010

SSS CIRCULAR NO. 04-10

TO : All Employers and Employees

SUBJECT : Implementing Rules and Regulations of the Social Security

Condonation Law of 2009

Pursuant to Section 5 of Republic Act (R.A.) No. 9903, An Act Granting the Social
Security System (SSS) a One-Time Authority to Condone Penalties on Unremitted or
Delinquent Contributions by Employers, also known as the "Social Security Condonation
Law of 2009," the Social Security Commission (SSC), under its Resolution No. 110-s.
2010, dated 10 February 2010, hereby issues the rules and regulations for the effective
implementation of the said Act.
SECTION 1. De nition of Terms. — Unless the context of a certain provision
of this Circular clearly indicates otherwise, the term:
(a) "Program" refers to the Condonation Program as provided for under R.A.
No. 9903.
(b) "Employer" refers to any person subject to compulsory coverage under
Section 9 (a) of R.A. No. 1161, as amended.
(c) "Contributions" refers to the amount to be paid to the SSS by and on
behalf of the members in accordance with Section 18 of R.A. No. 1161, as
amended.
(d) "Accrued penalty" refers to the unpaid three percent (3%) penalty
imposed upon any delayed remittance of contribution in accordance with
Section 22 (a) of R.A. No. 1161, as amended.
SECTION 2. Who May Avail of the Program. — Any employer who is
delinquent or has not remitted all contributions due and payable to the SSS may avail of
the Program, including the following:
(a) Those not yet registered with the SSS;
(b) Those with pending or approved proposal under the Installment Payment
Scheme of the SSS (Circular No. 9-P) pursuant to SSC Resolution No. 380
dated 10 June 2002;
(c) Those with pending or approved application under the Program for
Acceptance of Properties Offered Through Dacion En Pago of the SSS
(Circular No. 6-P) pursuant to SSC Resolution No. 29 dated 16 January
2002; DCIAST

(d) Those with cases pending before the SSC, Courts or O ce of the
Prosecutor involving collection of contributions and/or penalties;
(e) Those against whom judgment had been rendered involving collection of
contributions and/or penalties but have not complied with the judgment,
and;
(f) Those who, before the effectivity of the Act, have settled all contributions
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 but with accrued penalty.
SECTION 3. Unregistered Employers. — To qualify, an unregistered employer
shall rst register with the SSS Branch having jurisdiction over its place of business or
household address and remit its contribution delinquency in full or submit an
installment proposal under this Circular;
SECTION 4. Employers with Pending or Approved Proposals Under the
Installment Payment Scheme Program. — To avail of the Program, an employer with
pending or approved proposal to pay its delinquencies in installment shall remit its
contribution delinquency in full or submit an installment proposal under this Circular.
Upon remittance of the contribution delinquency in full or submission of an
installment proposal under this Circular, a pending or approved installment proposal
shall be considered withdrawn. The submission of an installment proposal under this
Circular shall have the effect of terminating an approved installment proposal, and the
remaining post-dated checks received by SSS if any, shall be returned to the employer
upon issuance by the latter of the post-dated checks required under this Circular.
SECTION 5. Employers with Pending or Approved Application Under the
Program for Acceptance of Properties Offered Through Dacion En Pago. — To avail of
the Program, an employer with pending or approved application for dacion en pago
shall remit the contribution delinquency in full or submit an installment proposal under
this Circular.
Upon remittance of the contribution delinquency in full or submission of an
installment proposal by an employer under this Circular, a pending dacion en pago
application shall be considered withdrawn. Further, the submission of an installment
proposal by an employer under this Circular shall have the effect of annulling an
approved dacion en pago application if the title to the property is not yet transferred to
the SSS.
SECTION 6. Employers with Pending Cases. — All cases pending before the
SSC, Courts or O ce of the Prosecutor involving collection of contributions and/or
penalties shall be withdrawn upon approval of proposal without prejudice to the re ling
of the same in the event the employer fails to remit in full the required delinquent
contributions or defaults in the payment of any installment under the Program.
SECTION 7. Penalties Covered Under the Program. — This Circular shall apply
only to accrued penalties on delinquent contributions due on or before February 1,
2010. TADaES

Penalties on contributions falling due thereafter shall not be covered by the

Program but shall be paid as prescribed by law.
SECTION 8. Contributions Paid Before the Effectivity of the Act. — For reason
of equity, the accrued penalties of the following employers shall likewise be condoned
or waived:
(a) Those who settled in full all their arrears in contributions before the
effectivity of the Act; and
(b) Those who partially settled their arrears in contribution before the
effectivity of the Act and pay the balance in full or in installment under the
Program.
SECTION 9. Period of the Program. — An employer may avail of the Program
within six (6) months from effectivity of the Act.
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 SECTION 10. Modes of Availing the Program. — An employer may:
(a) Remit within the period of the Program the full amount of the delinquent
contributions through any SSS Branch with tellering facility or authorized
collection agents of the SSS e.g., banks, payment centers; or
(b) Submit a proposal (Annex "A") within the period of the Program to pay the
delinquent contributions in installment to the SSS Branch having
jurisdiction over its place of business or household address. The proposal
shall contain an undertaking that should the settlement of contributions
through installment result in additional bene ts for contingencies that
have occurred prior to the date of settlement or shall occur within the
installment period, the employer shall pay the SSS damages in accordance
with the provisions of Section 24 of R.A. 1161, as amended.
In every case, the employer shall submit the corresponding Collection List/s
together with the proof/s of full remittance of its contribution delinquency or its
proposal to pay such delinquency in installment.
SECTION 11. Installment Proposal. — The Head of the SSS Branch to which
the installment proposal was submitted shall give due course to approve and grant the
same, subject to the following requirements:
(a) Upon submission of the proposal, the employer shall remit a
downpayment of not less than ve percent (5%) of its total contribution
delinquency;
(b) Together with the proposal, the employer shall submit a duly notarized
document (Annex "B") promising to pay the balance of the delinquency in
equal monthly installments within a period not exceeding forty-eight (48)
months, the rst monthly installment of which shall fall due within thirty
(30) days after date of approval of the proposal; and
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(c) The installment payments shall bear an interest of three percent (3%) per
annum based on the Amortization Factors for the Payment of Balance of
Delinquent Contributions under Installment Proposal issued by the SSS
(Annex "C").
If the employer is an association, partnership, corporation or any other institution,
any of its present managing head, director or partner shall sign the proposal and the
promissory note in his o cial capacity, attaching therewith a Secretary's Certi cate in
case of a corporation.
In case said employer has already been dissolved, any of its former managing
head, director or partner shall sign the proposal and the promissory note.
Upon approval of the proposal, the employer shall issue, within ve (5) working
days from receipt of Notice of Approval (Annex "D"), the corresponding post-dated
checks payable to the SSS to cover all monthly installments, and cause the replacement
thereof within reasonable period whenever necessary as in the case of change of its
authorized check signatory or closure of bank account.
The employer shall also remit its current contributions and member loan
amortization every month as they fall due.
SECTION 12. Right to Bene ts of Employees. — Should the settlement of
contributions through full payment or installment result in additional bene ts for
contingencies that have occurred prior to the date of settlement or shall occur within
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 the installment period, the employer shall pay the SSS damages in accordance with the
provisions of Section 24 of R.A. 1161, as amended.
SECTION 13. Restoration of Loan Privileges. — Upon remittance in full of the
delinquent contribution or approval of the installment proposal of the employer, the
short-term loan privileges of its employees shall be restored: Provided, that the said
employees comply with other requirements of their loan applications, provided further,
that said privileges shall again be suspended in the event of violation of any of the
terms and conditions set hereof.
SECTION 14. Grounds for Termination of Approved Installment Proposal. —
Any of the following omissions or acts by the employer shall be a ground for
termination of the approved installment proposal:
(a) Failure to issue the required post-dated checks;
(b) Failure to remit current contributions and member loan amortization;
(c) Default in the payment of any installment under the approved proposal; TIDcEH

(d) Refusal to pay the damages as provided for under Section 24 of R.A.
1161, as amended; or
(e) Violation of any of the terms and condition of the approved installment
proposal.
Upon termination of the approved installment proposal, the penalties are
deemed reimposed from the time the contributions rst became due, to accrue until
the delinquent account is paid in full.
SECTION 15. When are Penalties Condoned. — The penalty provided under
Section 22 (a) of R.A. No. 1161, as amended, shall be condoned by virtue of R.A. No.
9903 when and until all the delinquent contributions are remitted by the employer to the
SSS.
SECTION 16. Other Delinquency Payment Programs. — The accrued penalty
of an employer who opts to settle its contribution delinquency under a different
program outside the coverage of R.A. No. 9903 and/or its Implementing Rules and
Regulations (IRR), shall not be condoned or waived.
SECTION 17. Repealing Clause. — All other Circulars, rules and regulations,
and other issuances or parts thereof which are inconsistent with the provisions of this
Circular are hereby repealed or modified accordingly.
SECTION 18. Effectivity. — This Circular shall take effect immediately.
Please be guided accordingly.
(SGD.) SEC. ROMULO L. NERI
President and CEO

Approved by:
(SGD.) THELMO Y. CUNANAN
Chairman
Social Security Commission

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