With reference to news in a section of the press, the Securities and Exchange Commission of Pakistan (SECP) on Wednesday clarified that the increase in the fee structure will not discourage the corporate sector, or undermine the corporatization and documentation efforts of the government.
The SECP has not revised the fee structure relating to filing of statutory returns by smaller companies and of the services availed by the corporate sector on a regular basis, including filing of annual returns, obtaining certified true copies as well as inspection of documents filed with the registrar concerned.
The Sixth Schedule to the Companies Ordinance has been revised to encourage online submission of documents as well as to cover the rising regulatory costs primarily incurred in cases requiring deeper examination of complex, non-recurring, and event-based statutory returns as well as those requiring thorough analysis in specialised cases.
This revision will not affect the smaller private limited companies, constituting over 80 percent of the total corporate sector. Normally, such companies file two annual returns and annual filing cost comes to Rs 1,000 in case of online submission and Rs 2,000 in case of manual submission (now increased to Rs 2,500), which is unbearable for a corporate entity.
If the effect of filing cost in respect of event-based returns is also included under the revised fee structure, hypothetically over a five-year period, the average cost for statutory filings in respect of a medium-sized private company under online and offline modes would be Rs 2,800 and Rs 6,000 respectively. Similarly, for large private, public unlisted and listed companies, it would be Rs 9,000 and Rs 19,750, respectively, at the maximum. Therefore, the aforesaid annual cost of filing is negligible.
It is further clarified that the increase in fee has been made and new heads have been introduced in respect of notifying one-off statutory events, ie, filing of prospectus/statement in lieu of prospectus, conversion in status of companies, processing mergers cases (17 merger cases were processed during the last financial year), etc, or in respect of non-periodic statutory events like filing of special resolution, return of allotments, etc, or in respect of specialised cases, including licensing of companies under section 42 of the Companies Ordinance, 1984, etc. Additional time and efforts are consumed and costs are incurred for an in-depth examination of the aforesaid returns/statutory information and for thoroughly analysing specialised and non-periodic cases at the SECP.
The increase in fee structure for physical submission of documents has been made to encourage transition to online service delivery through eServices, which offers multiple benefits to the companies by ensuring prompt disposal of cases, delimiting territorial jurisdiction for filing of returns, curtailing visits of the end users to the Company Registration Offices, and avoiding the cost of hiring the services of corporate consultants for meeting their statutory requirements.-PR
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