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Company Registration in Pakistan

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Company Registration in Pakistan

Wouldn’t you just love it if you could increase your stream of income? Having new paths of profit inflow? This can be possible through solid INVESTMENTS.  But where to invest and how to invest is the main question.

Registering and operating a company in Pakistan has countless benefits like:

  • A rapidly growing economy,
  • Less competition,
  • Over 220m population, mostly young,
  • Access to talented new employees

How to Register a Company in Pakistan?

Company setup in Pakistan is fairly a straightforward and easy procedure. Following types of companies are allowed in Pakistan:

  • Free Zone Company (EPZ)
  • Limited Liability Company (LLC)
  • Limited Liability Partnership (LLP)
  • Public Limited Company (joint-stock company)
  • Representative offices,

The most common type of company incorporated is LLC.

Alternatives to Company Formation

a) Branch Office

A branch office is the most suitable option to have a Pakistan presence without the need for a company registration. The time for branch registration could be seven weeks and the permit can be valid for 1 to 5 years upon Board of Investment approval.

 b) Liaison Office

This can help you promote products in Pakistan with a 100% foreign-owned liaison office. Apart from this, liaison office can be used to:

  • Technical advice,
  • Technical assistance,
  • Export promotion,
  • Joint collaboration etc.

However none of the above can engage in any kind of trading or commercial activities.

10 EASY STEPS FOR COMPANY FORMATION IN PAKISTAN

  1. Getting the name approved by the Securities and Exchange Commission or SECP (the name should be unique, appropriate and not the one that is prohibited. The name can be reserved for a period of 90 days),
  2. Application or company registration fees payment through any designated bank (it can be paid offline through deposit receipt or online),
  3. Opening a bank account for your company,
  4. Preparing a company memorandum and article of association with all relevant signatures,
  5. Declaration of compliance completion,
  6. Submitting a list of company promoters with all the relevant documents to Securities and Exchange Commission (SECP) of Pakistan,
  7. Obtaining certificate of incorporation,
  8. Obtaining a digital signature (DSC) from the National Institutional Facilitation Technologies (NIFT),
  9. Registration for sales, income and professional taxes from the Federal Board of Revenue’s Regional tax Office.
  10. Depending upon your location in Pakistan, getting registered with labour department and social security institution

Minimum Requirements for Company Formation in Pakistan

For your company formation in Pakistan, you must know all the relevant company and subsidiary laws of Pakistan. The laws will differ depending upon the physical location and entity type. Minimum requirements for different types of legal entities in Pakistan are:

1) Single Member Company

  • Only one shareholder is required,
  • Minimum capital requirement of PKR. 100,000,
  • Four weeks incorporation time,
  • Registered address to be in Pakistan.

2) Partnerships:

  • The minimum number of partners must be two,
  • The liability of each partner must be unlimited,
  • Minimum capital requirement of PKR. 100,000,
  • Partnership deed on PKR.1,000 stamp paper,
  • Written rent agreement for office in a commercial area,

3) Private Limited Company:

  • Minimum number of shareholders must be two,
  • Minimum capital requirement of PKR. 100,000,
  • Six weeks incorporation time,
  • Approval from the Board of Investment (BOI),
  • Registered address to be in Pakistan,
  • Public listed companies must also get themselves listed on the stock exchange.

4) Public Limited Company (Listed or Unlisted):

  • Allowed to offer shares to the general public,
  • Six weeks incorporation time,
  • Minimum capital requirement:

LISTED: PKR 200,000  

UNLISTED: PKR. 100,000

  • Minimum number of shareholders:

LISTED: 7 

UNLISTED: 3

5) General Conditions:

  • The directors and shareholders will be required to get NTN number registration from the local tax authorities.
  • Further, for every LLC with Share capital of more than $5,000 is required to have a legal advisor.

Foreign Company Registration in Pakistan

Foreign Company

Every company which is formed or incorporated outside Pakistan with a place of business established in Pakistan is called a ‘Foreign Company’ and must get itself registered under the Pakistan Laws and Regulations.

A foreign company is required to submit the relevant documents to the registrar within 30 days of the place of business establishment in Pakistan.

What is a ‘Place of Business in Pakistan?’

Place of Business includes:

  • Management office,
  • Share transfer office,
  • Branch,
  • Registration office,
  • Mine,
  • Factory,
  • Agency maintain stock of merchandise on behalf of company,
  • Agency negotiating and concluding contracts,
  • Any fixed place of business.

Exceptions to Registration

  • Business dealings in Pakistan through bona fide broker,
  • Business dealings through general commission agent,
  • Company’s subsidiary that is resident in Pakistan, incorporated there and carrying on a business.

STEPS TO REGISTER A FOREIGN COMPANY IN PAKISTAN

Step 1: Company Name Availability

  • Seek the company’s proposed name availability from the registrar,
  • The name should not be inappropriate, deceptive, identical, or resembling that of another company, designed to offend religious susceptibilities of any person(s) or suggesting a connection with any Government or international organization,
  • Fee for seeking name availability: ONLINE – PKR.200;  OFFLINE – PKR.500

Step 2: Documentation

  • Time period to submit to the registrar: 30 days
  • Documents to be submitted:

> Form 38: Certified copy of memorandum and article of association, charter or statute,

> Form 39: Address of principal or registered office,

> Form 40 & 41: Particulars of directors, chief executive, secretary and registered office of the company,

> Form 42: Particulars of person(s) authorized to receive notices and services.

> Permission letter from the Board of Investment,

> Authority letter in the name of person authorized to receive notices and services,

> Challan for registration and other fees.

 

FEE PARTICULARS ONLINE (PKR) OFFLINE (PKR)
Foreign company registration 25,000 50,000
Statutory return/form filing 600 1,500

Statutory Obligations After Registration

After registration of your foreign company in Pakistan, you will be required to follow the below statutory obligations. But there is no need to worry, Pushdigits Chartered Accountants will not only help in the registration process but also assist you with all the ongoing procedures.

  1. Maintain registers of directors, officers, Pakistani members, and debenture-holders,
  2. Keep the registers open to inspection by the relevant authorities,
  3. Maintain the company’s name and incorporation country name in all the important documents (letters, notices, documents, advertisements, etc.)
  4. State in every prospectus, letter, official publication that the liability of the members is limited,
  5. File with the registrar, the following documents, within 45 days of submission to the authorities of the country of origin or 6 months from the date of the relevant accounts:
  • Form 45,
  • Annual audited accounts,
  • List of Pakistani debenture-holders and members,
  • Global audited accounts,
  1. Changes or alterations in the particulars of returns and documents submitted at the time of registration must be notified to the registrar within 30 days.

Liquidation Procedure for the Foreign Company

When your foreign company will go into liquidation in the country of its incorporation, you will be required to proceed with the following steps. In this too, Pushdigits will be your guide to an easy exit:

  1. Give a notice within 30 days to the registrar,
  2. Publish a notice in at least two daily newspapers having circulation in the place(s) of business,
  3. Furnish all returns and documents relating to liquidation to the registrar,
  4. In every notice, letter, document etc. state the fact the company is being liquidated in the country of incorporation.

Ring us up for further inquiries or queries. Pushdigits will be happy to help you through!

How Can Push Digits Help?

If your plan is to incorporate a company in Pakistan, Pushdigits can help you invest in the right way. We will assist you from the process of registration to the commencement of your business operations. Every step will be simplified for you so that you can begin commercial operations without the lengthy hustle.

The only information we will require to proceed is:

  • Shareholder’s name and addresses,
  • The total amount of share capital,
  • Copies of passport of shareholders,
  • Name proposed for the company.

That’s all you need to legally start operating in Pakistan! So what are you waiting for?