A Comprehensive guide to register a company in Pakistan 2024

A company is a registered limited liability business. It is registered with a state authority which might be Registrar of joint stock companies or Magistrate of corporations or Securities Commission etc. However, the authorities vary from country to country.  

Such a business structure has many names like LLC, Corporation, Pty Ltd, Private Limited, Listed entity, Pvt Ltd, Public limited company and many others. All these businesses have common features of limited liability, perpetual succession and a separate legal personality. 

In this blog I am going to discuss – how a company can be registered in Pakistan.

Lets begin 

A Bird’s eye view of Corporate Sector of Pakistan

The Securities and Exchange Commission of Pakistan (SECP) regulates the capital market (stock exchange and its participants) including the corporate sector of the country.

Sole proprietors, partnerships, family owned private companies, local brands, multinationals, listed entities, conventional banks, Islamic banks, micro finance institutions, public sector organizations (state owned), SBP, SECP, FBR and chamber(s) of commerce comprise the economic ecosystem.

However, family owned businesses, partnerships, sole proprietors (retailers and wholesalers in city markets) and private limited companies dominate the business ecosystem in terms of revenue. Mostly, they form part of the undocumented economy of the country.

The exchange commission registers following entities:

• Single member company
• Private company
• Public company (Listed and unlisted)
• Limited Liability Partnership (LLP)
• Section 42 which includes NGOs, charities, welfare organizations
• Foreign company (its branch office)
• Non banking finance companies (NBFCs)
• Trade organizations (TOs)
• Insurance companies
• Modaraba(s)
• Mutual funds
• Securities brokers, clearing houses, stock exchange, shares registrars, depository companies

The process of registration of above entities from list no 1 item to list item no 6 is almost the same regardless of the type. SECP registers such companies under the Companies Act 2017. However, the legal requirements and the technicalities vary for the individual companies. My blog will cover registration of only these companies.

I will discuss the process of registration of a company in Pakistan in detail. However, you have a choice to read this blog which summarizes the whole process.

Before I start, I want to explain a little bit of confusion – in Pakistan people often mix up sole proprietorship with a company which is registered with SECP and it has certain privileges like limited liability, separate legal person etc. A sole trader can not enjoy such benefits. 

Let’s begin

Create your account on SECP eZfile (LEAP portal)

LEAP eZfile is an online portal of SECP. You need to create your account while you must have:

• Your Computerized National Identity Card (CNIC or National ID card) or passport for foreign nationals or NICOP for overseas (or dual national) Pakistanis
• Pakistani SIM mobile number
• Email ID

After you have entered all required information such as name, your father’s name, address, email, CNIC / passport / NICOP and mobile number, desired password, SECP sends codes on email and mobile number. Just enter the codes in the respective boxes. Now your account is created.

For foreign nationals, the account creation process is the same except SECP sends code on their email address. Email code verification is enough for their accounts creation. Their passports must be valid.

Security clearance of foreign nationals from the Ministry of Interior (MOI) is mandatory. The Registrar of Companies registers the company having such them as shareholder or director, as the case may be, and forwards the case to MOI. if Ministry does not clear such persons, then the company has to remove them as shareholder / director.

For overseas Pakistani nationals and dual nationals, their valid NICOP(s) are required. For them, email code verification is enough. However, for the overseas Pakistanis there is no requirement of security clearance.

Remember: you need to create eZfile accounts of all the directors and shareholders of the proposed company in the same way. Your passport or ID card number becomes your login ID.

Opt the required company type

Once you have created accounts on eZfile, you need to decide which structure will suit you best. On the basis of structure, documentation requirements vary.

If you are sole proprietor and want to avail benefits of a corporate structure, a single member company is for you. 

Two or more than two partners are willing to get benefits of limited liability but with the essence of a partnership business, a limited liability partnership is going to help them.

Two or more than two partners are willing to avail a complete package of a company like its limited liability, perpetual succession, borrowing powers etc. A private limited company is here for them. 

Public company setup works best when its founders are going to get finance from the public at large. This finance can only be obtained from the stock exchange. The finance is usually equity and in the form of shares.  

Section 42 companies are welfare organizations having privileges of a company such as limited liability, perpetual succession, borrowing powers etc. As per SECP practices and Companies Act 2017, these companies are guaranteed limited not having share capital. Each of its founders are required by the law to undertake at least 200,000 rupees as start-up donation.  

In Pakistan, foreign companies have two options – one to become a holding company (while purchasing more than 50% of shareholding) of a locally registered company and last to get their branch office registered. 

Prepare required documents / information

Good you have successfully created your account on LEAP eZfile and you have opted for the company type. Now, SECP requires following information from you:

• CNIC(s) / passport(s) / NICOP(s) of all the directors and shareholders including CEO
• Full name, father’s name, residential address(es), mobile number and email address of the above persons
• Proposed (ratio of) shareholding (not for LLP and Section 42)
• Authorized share capital (not for LLP and Section 42)
• Paid up share capital (not for LLP and Section 42)
• Company name, address, registered office address, principal line of business (main business objects), email, website, telephone

For Single member company (SMC), the following additional documents / information are required:

1. CNIC / NICOP / Passport of nominee (next of kin)
2. Full name, relationship with director, mobile number, email and residential address of next of kin 

Here, I have covered in detail the registration of sole proprietors as a company.

For Limited Liability Partnership (LLP), the following additional documents / information are required:

1. Initial capital of LLP
2. Ratio of sharing of profit and loss of LLP
3. Attested copy of duly executed LLP agreement, witnessed and notarized.
4. Consent of designated partner.

The initial equity of LLP is not divided into shares. Instead, it is the amount which is contributed by the partners. LLP has the privilege of limited liability. Here, I have covered in detail the registration of LLP in Pakistan.

For Section 42 organization, SECP requires the following additional compliances:

1. Its proposed objects must be from the approved ones. 
2. There must be at least 3 founding members.
3. Members must have adequate experience.
4. Startup donation is 200,000 Rupees. 

There is a long list of additional compliances for Section 42 companies. I can not cover it here. It would make this blog too lengthy.  Therefore, I have covered in detail the licensing of Section 42 companies.

For foreign company, SECP requires certified and English or Urdu translated copies of the following documents:

1. Certificate of incorporation / registration
2. Constitution like its Memorandum, Article, Deed or any other instrument of formation
3. Board Resolution / NOC

The Pakistan Embassy located in the respective foreign country will certify the documents. Regulator(s) of foreign companies will issue and certify the company documents under its official seal.

SECP has some special requirements for registering foreign companies. Therefore, I have covered this topic in detail in my other blog.

Before you start, you should know about the Memorandum and Articles of your proposed business. Both these documents are constitutional documents of a company. You will find their formats at the SECP official website. Don’t worry eZfile will generate them for you on starting the registration application.

Reserve your desired name

Once you have created an account and gathered required documents / information, check the availability of the name of your proposed business. Criteria for acceptable names that they are:

• Unique
• Appropriate
• Not identical of already registered company or LLP
• Not same as the name of already registered company or LLP
• Not a prohibited by corporate law
• Not designed to exploit the sovereignty of Pakistan
• Not designed to exploit the religious sentiments of people

The portal asks for three names and significance of your proposed name. Suggest three names. Write the reason for using the proposed name in “significance”.

When you apply for a name, the portal gives you the following options of companies. Carefully select the one you need:

1. Single Member company
2. Private Limited company
3. Public Limited company
4. Section 42 company
5. Limited liability partnership
6. Trade organization

Remember: when you are applying for the name reservation, you must carefully select the type of company (LLP, Private, Public, Section 42 and Single member).

Also remember: eZfile gives two options for company registration – separate and combined. In the separate process, name is allowed first, then the process of registration starts after the name reservation. For the combined process, name reservation is part of registration.

Complete online registration application

Next step to complete online application. Just enter following information in the respective areas / tables / boxes of the form then click submit.

1. CNIC number, full name, father’s name, residential address(es), mobile number and email address of all the directors and shareholders including CEO.
2. Authorized share capital
3. Face value of shares and number of shares taken by the directors. The form will auto calculate total paid up capital.
4. Company name, address, registered office address, principal line of business (main business objects), email, website, telephone

Remember: you have an option to register with EOBI and social security institute when you are registering your company. Therefore, SECP asks to enter your information two times – one for the company and other for the 3rd parties. 

Digitally sign the application

When you create an account on LEAP portal, it sends you PIN via SMS and email. This PIN is your digital signature. Before submission, enter the provided secret PIN of 4 digits then verify the process. Repeat these digital signatures for all the directors one by one.

Remember: save your PIN. If you have forgotten it, you can retrieve it by requesting on LEAP in the update profile menu.

Submit your process

Once the registration application is signed with the PIN(s), it becomes enabled for the submission. On submitting it, portal will generate payment challan which can be paid online via:

• Easypaisa
• Jazz Cash
• Credit Card
• Debit Card
• Any digital banking application 
• Link 1 challan

Remember: Carefully cross check the particulars before submitting the application. Once you have submitted, to amend it will take 2 to 4 hours for updating information. After the payment of challan, you can not update anything in the provided particulars until SECP reverts back the process,

Get the company registered

The Registrar (SECP officer) will manually check the application before his final approval. For any discrepancy, he reverts back the application. He also sends an email for his approval and objection. 

SECP will issue digital copies

Lastly, you will receive an email for the confirmation of your company registration. The email will contain:

• Digital Certificate of Incorporation
• Acknowledgment of filing of registration application
• Digital copies of company documents like Memorandum, Articles and incorporation application if you mark it during applying for registration.

SECP issues following digital copies if you check mark option of issuance of digital copies;

1. Memorandum of Association
2. Articles of Association
3. Certificate of incorporation 
4. Application of incorporation

Final Thoughts

That’s the whole process of registration. SECP already has published a user guide for it. You can register your company yourself. However, it will consume your time. To save your time and effort, we are here to help you. 

Talk to us and feel relaxed. Your company will be registered with SECP without your headache. 

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