Practice question
Participants contribute money to a common enterprise. A manager alone selects and operates income-producing assets, and participants expect a share of the resulting profits primarily from that manager's work. What classification best fits these facts?
- An investment contract
- An ordinary purchase solely for personal consumption
- A contract excluded because it is not called a share of stock
- A transaction excluded because the enterprise uses physical assets
- A transaction excluded whenever participants receive written contracts
Legal references
- RA8799, Securities Regulation Code, Section3.1: https://lawphil.net/statutes/repacts/ra2000/ra_8799_2000.html
- Power Homes Unlimited v. SEC, GR164182, February26 2008, main decision: https://lawphil.net/judjuris/juri2008/feb2008/gr_164182_2008.html
- SEC v. Prosperity.Com, GR164197, January25 2012, main decision: https://lawphil.net/judjuris/juri2012/jan2012/gr_164197_2012.html
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