Navigating Foreign Company Registration Law in Pakistan: An In-Depth FAQ Guide
Disclaimer: The information provided here is for general guidance only and should not be considered as legal advice. For property and real estate legal advice and consulting, please contact City Laws Associates.
Definition of Foreign Company:
– Q. What is meant by a Foreign Company?
– A. A Foreign Company is one registered outside Pakistan under a law other than Pakistani law, establishing its place of business within Pakistan.
Mandatory Registration:
– Q. Is registration with the Securities & Exchange Commission of Pakistan mandatory for a foreign company?
– A. Yes, it is compulsory for a foreign company to register with the Securities & Exchange Commission of Pakistan.
Permissions for Branch/Liaison Office:
– Q. Does a foreign company need other permissions for opening and maintaining its branch/liaison office in Pakistan?
– A. Yes, a foreign company requires permission from the Board of Investment, Government of Pakistan.
Duration of Board of Investment Permission:
– Q. For how long does the Board of Investment grant permission for opening a branch/liaison office in Pakistan?
– A. Initially, the permission is granted for three to five years. After expiry, renewal/extension is required.
Name Adoption for Place of Business:
– Q. Can a foreign company adopt any name for its place of business in Pakistan?
– A. The foreign company can use the name registered in its country of origin for its principal place of business in Pakistan.
Language of Memorandum and Articles:
– Q. Will the Securities & Exchange Commission of Pakistan accept documents in a language other than English?
– A. Documents in languages other than English or Urdu require duly certified translations. Authentication by a Pakistani diplomatic consular officer is necessary.
Timeline for Document Delivery:
– Q. Within how many days must a foreign company deliver documents to the Registrar SECP?
– A. Every foreign company establishing a place of business in Pakistan must deliver requisite documents to the registrar within thirty days of establishment.
Certification Requirements:
– Q. What type of certification is needed for documents defining the constitution of a foreign company?
– A. Documents constituting the constitution must be duly certified by a public officer, Notary Public, or through an affidavit of a responsible officer, with authentication by a Pakistani diplomatic consular officer.
Notification of Changes:
– Q. Is a foreign company required to notify the registrar on changes in its documents?
– A. Yes, any change or alteration in documents must be communicated to the registrar.
Meaning of Global Accounts:
– Q. What are Global Accounts?
– A. Global Accounts refer to accounts filed by a foreign company with the authorities in its country of origin. If not required there, the company prepares and audits Global Accounts for filing under the Companies Ordinance, 1984, similar to a public company.
Statutory Obligations for Foreign Companies:
– Q. Are there statutory obligations for foreign companies?
– A. Yes, foreign companies must maintain registers, state their country of incorporation in prospectuses, display their name and country of incorporation, and comply with other obligations under the Companies Ordinance, 1984.
Exclusion from Account Delivery:
– Q. Are there exclusions for foreign companies from delivering accounts?
– A. No, all foreign companies must deliver accounts in Pakistan, and the accounts are prepared and adjusted like those of a public company.
Registration of Mortgage and Charges:
– Q. Are provisions for registration of mortgage and charges applicable to foreign companies?
– A. Yes, all provisions of the Companies Ordinance, 1984, regarding the registration of mortgage and charges apply to foreign companies.
Bookkeeping Obligations:
– Q. Do foreign companies need to keep books of account?
– A. Yes, according to section 230 of the Companies Ordinance, 1984, every foreign company must maintain proper books of account at its registered office in Pakistan.
Intimation before Closure:
– Q. Must a foreign company intimate the registrar before closing its business in Pakistan?
– A. Yes, at least thirty days before ceasing to have a place of business in Pakistan, the company must give notice to the registrar and publish it in two daily newspapers.
Liquidation Procedure:
– Q. If a foreign company undergoes liquidation in its country of origin, what procedure is followed in Pakistan?
– A. The company must notify the registrar within thirty days, publish the notice, and furnish all returns and the liquidation account within thirty days of concluding the proceedings.
Penalties for Non-Compliance:
– Q. Is there a penalty for a foreign company failing to comply with the Companies Ordinance, 1984?
– A. Yes, fines can be imposed on a foreign company and its officers or agents knowingly or willfully permitting the default.
Registration with Tax Authorities:
– Q. Are foreign companies required to register with tax authorities in Pakistan?
– A. Yes, Liaison/Branch offices are required to register with tax authorities in Pakistan.
For detailed assistance and professional consulting on Company Incorporation, Establishment of Branch/Liaison office, and various corporate matters in Pakistan, contact City Laws Associates law firm.
