Foreign companies doing business in Pakistan are required to submit additional documentation with the Securities and Exchange Commission of Pakistan (SECP) under the new Companies Regulations, 2022.
The latter explained the documentation requirements for the new foreign companies intended to be incorporated in Pakistan and has circulated the draft of the Companies Regulations, 2022 to the stakeholders for comments.
It will obtain prior security clearance under the policy approved by the government concerning foreign funding, donation, foreign promoters, foreign directors, and foreign chief executive officers of the applicant seeking a license under these regulations. The company, after the grant of a license, will obtain prior security clearance through an application made to the commission in case it intends to receive foreign funding, donation, induct foreign members, or appoint a foreign director or chief executive officer.
The application for the registration of the documents of a foreign company will be accompanied by a certified copy of the charter/statute/memorandum and the articles of association or instrument defining the constitution of the foreign company, Board Resolution regarding the appointment of the principal officer, as well of the person authorized to accept on behalf of the company service of process/any notice/document, consent of the Principal Officer, and persons authorized to accept on behalf of the company service of process/any notice/document, valid approval letter from the board of investment or any other document as notified by the SECP.
In case the subscriber is a foreign company or a foreign body corporate, the registrar will require additional information, including but not limited to the profile of the foreign company or foreign body corporate; details of its directors, their nationality, and country of origin; a copy of its charter, statute or memorandum, and articles; a copy of the certificate of incorporation, board resolution by the foreign company for the appointment of a nominee, and the authorization to acquire shares in the proposed company; an undertaking on the specified format as per Annexure-S duly attested by the notary public, etc., the SECP said.
In case a foreign company changes its name in the country of origin, it may apply to the registrar to change its registered name, subject to compliance with the requirements of section 12 read with section 442 of the Act as far as applicable and these regulations. The application for a change of name of a foreign company will be accompanied by a name availability letter, a letter from the board of investment, a copy of the certificate of change of name, or any other document containing the new name of the company issued by the public authority in the country of origin, a copy of the memorandum of association/ statute/ instrument duly certified as per these regulations, an affidavit duly signed by the person who signed this application, duly verified and attested by oath commissioner, and any other document deemed necessary, the SECP said.
Every foreign company that establishes a place of business in Pakistan will deliver the information and documents as mentioned in section 435 of the Act to the registrar as per Form-2. The application for the registration of the documents of a foreign company will be accompanied by a certified copy of the charter/ statute/ memorandum, and the articles of association or instrument defining the constitution of the foreign company, Board Resolution regarding the appointment of the principal officer, as well of the person authorized to accept on behalf of the company service of process/any notice/ document, the consent of the Principal Officer and persons authorized to accept on behalf of the company service of process/ any notice/ document, valid approval letter from board of investment or any other document as notified by the commission.
The new regulations revealed that on the registration of the memorandum of association of a company, the registrar will issue a certificate of incorporation under his signatures or authenticated by his official seal, as per Annexure-C, which will be conclusive evidence that the requirements of the Companies Act as to registration have been complied with and that the company is duly incorporated.
The new regulations stated that a foreign company will, at least 30 days before it intends to cease to have any place of business in Pakistan, notify the registrar on Form-6 along with a copy of the advertisement as published in two newspapers (one in Urdu and one in the English language), and a letter from Board of Investment regarding the closure of Business. A copy of any charter/ statute/ memorandum/ articles or other instruments constituting or defining the constitution of a foreign company is required to be filed with the registrar under clause (a) of sub-section (1) of section 435 and section 436, and any other document required to be filed under Part XII of the Act and these regulations excluding copies of financial statements to be filed under section 437 of the Act, will be duly certified to be a true copy by – (i) the public officer in the country where the company is incorporated to whose custody the original is committed, or (ii) a Notary public of the country where the company is incorporated; or (iii) an affidavit of an authorized officer of the company duly authorized in the country where the company is incorporated.
The signature and seal of the official referred to in clause (i) or the certificate of the Notary Public referred to in clause (ii) of sub-regulation (1) shall be authenticated by a Pakistan diplomatic consular or consulate officer. The affidavit of the officer of the company referred to in clause (iii) of sub-regulation (1) will be signed before a Pakistan diplomatic consular or consulate officer and the document regarding his authorization by the company for making such an affidavit will be accompanied therewith and will, likewise, be authenticated by a Pakistan diplomatic consular or consulate officer.
In the case of a member of a foreign company holding at least 25 percent of the shares, voting rights, or controlling interest in the foreign company on behalf of some other person, additional particulars of ultimate beneficial owners will be obtained, maintained, and duly updated by the foreign company.
In the case of indirect shareholding or control, certain particulars of legal persons or legal arrangements through whom shareholding, interest, or control is exercised in the chain of ownership or control will be required.
