The National Assembly Wednesday passed three bills "The Anti-Money Laundering (Amendment) Bill, 2015, The Companies (Amendment) Bill, 2015 and The Stock Exchanges (Corporati-zation, Demutualization and Integration) (Amendment) Bill, 2015.
Federal Minster for Finance Mohammad Ishaq Dar moved these three Bills in the lower house of Parliament for their passage. The House passed the Bills with majority. The main purpose of "The Anti-Money Laundering (Amendment) Bill, 2015, already passed by the Senate, is to further improve and strengthen the existing law (Anti-Money Laundering Act 2010). This legislation would help the government to ensure that the proceeds of crimes and property involved in money laundering are detected, investigated and prosecuted effectively.
According to clause-2 of the Bill, amendment of section 2 of Anti-Money Laundering Act, 2010, after clause (r), the new clause shall be inserted namely: - "Property involved in money laundering means proceeds of crime, property derived or obtained directly or indirectly form the offence of money laundering and property used or intended to be used in commission of the offence of money laundering, a predicate offence or a foreign serious offence."
According to another amendment of section 6 in the Act, the clause (g) shall be substituted, namely "(g) to submit to the General Committee and the National Executive Committee the report including an annual report containing an overall analysis of the Suspicious Transaction Reports and Currency Transaction Reports (CTRs), statistics concerning the investigation and prosecutions conducted in relation to the offences of money laundering and financing of terrorism in Pakistan and recommendations on counter-measures to combat money laundering and financing of terrorism, Financial Monitoring Unit (FMU) may call periodic reports from the investigating and prosecuting agencies in such a manner as may be specified by FMU.
The Companies (Amendment) Bill, 2015 seeks to provide for the listed companies to either cancel the repurchased shares or retain them as treasury shares.
According to objectives of the Bill, "listed companies, which feel that their shares are undervalued on the stock market, may buy back/repurchase their shares which may improve the earning per share of such companies and bring stability in the market price of such shares."
According to sub-clauses (2) and (3) of clause -2 of the Bill, " (2)The shares purchased by the company may, in accordance with the provisions of this section and the regulations, either be cancelled or held as treasury shares.
(3) The shares held by the company as treasury shares shall, as long as they are so held, in addition to any other conditions as may be prescribed, be subject to the following conditions, namely:-
(a) The voting rights of these shares shall remain suspended; and
(b) No cash dividend shall be paid and no other distribution. whether in cash or otherwise of the company's assets, including any distribution of assets to members on a winding up shall be made to the company in respect of these shares:
Provided that nothing in this sub-section shall prevent
(i) an allotment of shares as fully paid bonus shares in respect of the treasury shares; and (ii) the payment of any amount payable on the redemption of the treasury shares, if they are redeemable."
The clause-4 of the bill describes as "The board of directors shall recommend purchase of the shares to the members. The decision of the board of directors shall clearly specify the number of shares proposed to be purchased, purpose of the purchase ie cancellation or holding the shares as treasury shares, the purchase price, period within, which the purchase shall be made, source of funds, justification for the purchase and effect on the financial position of the company."
According to objective of "The Stock Exchanges (Amendment) Bill, 2015", with the passing of Stock Exchange (Corporation, Demutualization and Integration) Act, 2012, in March 2012, the timelines period in the amended sections have become ineffective. In order to make these sections meaningful, it is essential to substitute the respective dates suitably.
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