The Securities and Exchange Commission of Pakistan (SECP) has initiated winding up proceedings against 90 companies and 10-12 cases have been referred to the courts for completion of winding up process.
The SECP officials informed media persons at the SECP Headquarters, here on Thursday that they have gone to courts for winding up of companies under the laid down procedure. They also referred to certain listed companies which are not engaged in any activity nowadays.
Highlighting the SECP initiatives, the officials said that designated facilitation desks have been established in companies' registration offices (CROs) of Karachi, Lahore and Islamabad for facilitation of public. Instructions have been issued to all CROs to provide maximum facilitation to public in respect of incorporation of companies. Incorporation fee for small companies having authorised capital up to Rs100,000 has been substantially reduced and now a small company can be incorporated by just paying incorporation fee of Rs2,000 in case of online filing and Rs4,000 in case of offline filing. The facility of fee payment through bank transfer and credit cards has also been provided apart from payment through conventional mode. In addition, free certified copies of incorporation documents at the time of incorporation of companies and subsequent filing of statutory returns are being provided to reduce cost of doing business and facilitate business community. The CROs in Karachi, Lahore and Islamabad operate on Saturdays exclusively for providing service to business companies/corporate sector.
A number of measures proposed in the draft Companies Bill 2017, which has already been passed by the National Assembly and is presently under the consideration of the Senate, will further encourage the small businesses to adopt the corporate form of business organisation and contribute towards a healthy growth of the corporate enterprises, a primary objective of the commission.
Chairman Securities and Exchange Commission of Pakistan (SECP) Zafar Hijazi said that various reform measures are being introduced through the said bill to facilitate business start-up in the country. These include provisions for a fast-track start-up through allowing simple one-page memorandum of association, and allowing the business entities to undertake all lawful businesses in corporate form, except the prohibited/restricted businesses. Single member companies have been exempted from the requirements to hold annual general meeting as well as to appoint company secretary.
Further, such companies along with private companies having paid-up capital of not more than Rs3 million have been exempted from the requirement to file annual returns if there is no change in particulars in the last annual return filed with the registrar. Private companies with paid-up capital not exceeding Rs10 million have also been proposed to be exempted from the requirement to file financial statements. Moreover, the Companies (Appointment of Legal Advisers) (Amendment) Act, 2017, has been promulgated and the threshold of the paid-up capital for companies to appoint their legal adviser has been increased from over Rs 500,000 to over Rs 7.5 million. As a result of this reform, around 30,000 companies have been relieved of this regulatory burden, Hijazi said.
The SECP experienced a robust corporate growth in the country resulting from the wide range of reform measures during the last couple of years. The SECP registered 854 companies during February 2017, which exhibited a robust growth of 71% over the corresponding month of the last year. Overall, an impressive growth of 34% has been observed in corporate sector during the current financial year over the corresponding period of the last year. A number of other reform measures are in the offing which are likely to further elevate the corporate trajectory to a higher level, and will also assist the government in meeting its fiscal targets through enhanced documentation of the economy. The salient reform measures which are being taken to further ease doing business environment in the country include revamping of eServices and integration of corporate registry with the provincial authorities, etc. The Limited Liability Partnership Bill, 2017 has been passed by the National Assembly on February 1, 2017 and has now been introduced in the Senate.
The SECP continued its consultation with stakeholders including FPCCI, OICCI, PBC, ICAP, MAP and ICMAP to discuss their concerns and suggestions on the draft law. By and large, there was found to be broad consensus on the draft law. However, OICCI, PBC and ICAP had a few reservations on the proposed establishment of beneficial ownership registry under the company law framework, and they were of the opinion that the same shall be covered under the taxation laws of the country. During the discussions, the SECP highlighted recommendations of various international forums where efforts are being made to establish beneficial ownership registries. The ICMAP had reservations on the financial and cost audit rights, which were duly clarified during the consultation session held with them, he added.