“We therefore assume that the company or the petitioner`s system constitutes an investment contract constituting a guarantee in accordance with R.A. 8799. Therefore, before selling or selling or distributing to the public, it must be registered with the public service respondent, the SEC. As the petitioner did not register it, his offer to the public was properly presented by the public service defendant, the SEC. The LCO was correct even without fraud. As an investment contract that constitutes a guarantee under R.A. 8799, it must be registered with the public service defendant, the SEC, otherwise the SEC will not be able to protect the public who invests against fraudulent securities. Strict securities regulation is based on the principle that capital markets depend on the confidence of the public investing in the system. ” (Power Homes Unlimited Corporation vs. Securities and Exchange Commission, G.R.

No. 164182, February 26, 2008, [Puno, C.J.], referring to spent cases of SEC vs. W.Howey Co. and SEC vs. Glenn W. Turner Enterprises, Inc. et al. TEST HOWEY is the test to determine whether a transaction falls within the scope of an investment contract. It requires that a person: 4.

Be deducted above all from the efforts of others. It is a “contract, transaction or system (collectively “contract”) in which a person invests his money in a joint venture and is led to expect profits first through the efforts of others. (R.A. 8799).