The President approved the Companies Ordinance 2016 on 11 November 2016, which replaces the Companies Ordinance 1984.

The main points of the new company’s ordinance are set out below:

–Registration and operations of companies in Pakistan have been eased up for the owners under the ordinance.–It encourages the use of modern electronic means of communication to ensure maximum participation of members in a company’s decision-making process.

–It provides protection to independent and non-executive directors to encourage inclusion in the Board, as well as provisions for the manner of selection and maintenance of databases of independent directors.

–It addresses issues relating to the protection of minority shareholders’ interests and creditors.

–It introduces provisions for registration of values, a dispute resolution mechanism through a “mediation and conciliation” panel, passing of members’ resolutions through circulation, as well as simplified provisions for expeditious mergers and acquisitions.

–It emphasises maximum disclosures by Pakistanis to the local regulatory authorities in respect of investment in foreign companies.

–It provides facilitation and regulation of public sector enterprises.

–To ensure adequate measures against fraud, money laundering and terrorist financing, it empowers the SECP to investigate and conduct the joint investigation.

–Foreign companies operating in Pakistan are obliged to provide complete information on their directors, officers and/or beneficial owners.

–It includes provisions for Shariah certifications of companies and requirements for real estate companies for providing enhanced protection to the investor.

–It provides relief and incentives to the corporate sector, particularly small and medium-sized companies, to give immediate impetus to the economy and stimulate economic growth. This would reduce the cost of incorporating and doing business, enabling Pakistan’s corporate sector to be competitive in the international markets.