A meeting of the Senate Standing Committee on Finance, Revenue and Economic Affairs was held to further discuss The Limited Liability Partnership (Amendment) Bill 2020 and The Companies (Amendment) Bill 2020.
The committee was briefed by Senator Musadik Masood Malik, convener of the Sub-Committee constituted on Monday, about the deliberations and briefing by the SECP as to the meanings of the terms direct and indirect control, ultimate beneficial owner and others mentioned in both acts.
The sub-committee was told that any person who directly through himself/herself or indirectly through his spouse, children or any company maintain 25% ownership of a company is termed as the ultimate beneficial owner of the company and the obligation of maintaining his name in the register falls with the company itself otherwise penalties can be imposed.
Similarly, any person who has value shares or has power over the appointment of board of directors (among other instruments) is considered to be exercising control over the company directly or indirectly.
The sub-committee was also given an undertaking by SECP that although the threshold of 25% is not mentioned in the law, it will be specified in the regulations made by SECP. Similarly, an undertaking was given that the terms of ‘five years’ for maintaining records for companies in case of dissolution will be followed and won’t be changed. The Limited Liability Partnership (Amendment) Bill could not be discussed because of limited time.
The standing committee that met with Senator Farooq Hamid Naek in the chair deliberated further on the bill and observed that while The Companies (Amendment) Bill mentions these definitions in the relevant section, The Limited Liability Partnership (Amendment) Bill does not have them. Similarly, members also discussed the efficacy of undertakings in comparison to actual amendments that can be brought and made part of the bill.
A vote was held to make a decision on whether amendments seeking further clarity into the definitions and specifying the percentage of ownership should be added to the bill or not. 4 members voted in favor of the amendments while 3 voted against them. Consequently, it was decided that amendments shall be brought in House.
The meeting was attended by Senator Sherry Rehman, Musadik Malik, Dilawar Khan, Zeeshan Khanzada, Imamuddin Shauqeen, Mohsin Aziz, Additional Secretary from the ministry, Director-General FATF Pakistan, Chairman SECP, Legal Advisor SECP.