ISLAMABAD-The Securities and Exchange Commission of Pakistan (SECP) registered 2,220 new companies in July 2023, a 25 percent increase from the previous year.
The total capitalization for these companies was Rs. 3.3 billion. The total number of registered companies in the country rose to 197,828. About 57% of Pakistan’s companies are private limited companies, 41% single-member companies, and 2% not-for-profit associations, trade organizations, and LLPs. 99.7% are registered online, and three foreign companies have established business in Pakistan. 86 foreign applicants have registered from overseas.
The information technology sector took the lead with incorporation of 316 companies , trading with 309, services with 260, real estate development & construction with 252, food & beverages with 96, tourism with 91, education with 90, corporate agricultural farming with 70, ecommerce with 64, textile with 57, marketing & advertisement with 48, transport with 45, engineering with 42, healthcare with 41, pharmaceutical 36, mining & quarrying with 35, power generation with 30, lodging with 28, communications with 26, chemical with 24, cosmetics & toiletries 21, auto & allied and broadcasting & telecasting with 20 each, paper & board with 19, cables & electrical goods with 12, and 168 companies were registered in other sectors.
Foreign investment has been reported in 42 new companies, having foreign investors from Afghanistan, Canada, China, Djibouti, Germany, Hong Kong, Iran, Italy, Kuwait, Norway, Saudi Arabia, Singapore, Spain, Sweden, Turkey, UAE, UK, US and Vietnam. Major chunk of investment was received from China with 16 companies, Singapore and UAE with 3 each, Afghanistan, Iran, US and Vietnam with 02 each, and in 12 companies from other countries.  SECP’s WhatsApp facility handles name availability and incorporation queries, with 1,305 responses and a 96% satisfaction rate in the month.
SECP imposes maximum term limits on CEOs and directors of CMII
The Securities and Exchange Commission of Pakistan (SECP), in order to promote best governance practices and maintain focus on core operations, has introduced maximum terms limits for the Chief Executive Officers and Independent Directors to serve in the Capital Market Infrastructure Institutions (CMIIs) i.e. PSX, NCCPL, CDC and PMEX.
SECP has introduced tenure limits upon CEO of a CMII to a maximum of three terms with the third term to be allowed only in case of exceptional performance and subject to a competitive selection process. Moreover, the tenure limits for independent directors have been capped at maximum three terms across all CMIIs. Further, no individual shall serve as independent director on the board of the same CMII for more than two terms.
CMIIs perform important public policy functions including the infrastructure, services and regulations. It is expected that these reforms will encourage greater participation by professionals in the governance of the CMIIs and promote a culture of independence, accountability and objective decision making.
Earlier, Chairman SECP, Akif Saeed during his meetings with the boards of directors of CMIIs last week, stressed upon the need for CMIIs to follow the highest standards of corporate governance while discussing other reforms aimed at product development, risk management, debt market development and enhanced cybersecurity. Commissioner SECP, Abdul Rehman Warraich stressed upon the need of appropriate distribution of responsibility between BOD and management, a transparent and equitable compensation structure, proper succession planning and ensuring boards’ independence.
The limits have been imposed by approving amendments to licensing regulations of CMIIs. The notifications of approved amendments are available on SECP’s website.