Practice question
Participants in an agricultural program each independently decide what to plant, hire labor, buy inputs, sell the harvest and bear the results of their own operations. The organizer only supplies a separately priced training manual. On the stipulated facts, any expected farm profit comes primarily from each participant’s work, not organizer management or pooled operations. Which investment-contract element is not established?
- Profits primarily from the efforts of others
- The existence of any human activity
- The possibility of paying money for a manual
- The existence of agricultural products
- The possibility of keeping records
Legal references
- RA8799 Securities Regulation Code: https://lawphil.net/statutes/repacts/ra2000/ra_8799_2000.html Sections3.1,9–10.
- Power Homes Unlimited v. SEC, GR164182, February26 2008 MAIN: https://lawphil.net/judjuris/juri2008/feb2008/gr_164182_2008.html MAIN flexible investment-contract test.
- SEC v. Prosperity.Com, GR164197, January25 2012 MAIN: https://lawphil.net/judjuris/juri2012/jan2012/gr_164197_2012.html MAIN test and role of persuasive foreign authorities.
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