Regulatory Reforms Proposed for Pakistan’s Companies Act

A high-powered subcommittee focusing on regulatory changes has suggested substantial revisions to the Companies Act 2017. The goal is to align Pakistan’s corporate regulations with leading international standards.

These proposals came under discussion during a meeting on Monday, presided over by Haroon Akhtar Khan, the Special Assistant to the Prime Minister on Industries and Production.

The assembly included Scott Jacobs, along with representatives from the Board of Investment (BOI), the Securities and Exchange Commission of Pakistan (SECP), and the State Bank of Pakistan (SBP).

According to sources, the SECP and BOI collaboratively introduced a series of recommendations intended to modernise the existing legislation.

Key suggestions involve eliminating the lower and upper thresholds for the number of shareholders in private and publically traded firms, enabling greater variety in corporate structures and removing unnecessary rules.

Haroon Akhtar stressed the urgency of drafting the agreed-upon recommendations. He cautioned that excessive regulations, slow processes, and obstacles to ease of doing business posed significant challenges for companies operating within the nation.

He also pointed out that various clauses within the current legal framework are antiquated and impede innovation in contemporary corporate arrangements.