Ordinance abolishes provision for serving notices on companies

The newly-promulgated Companies Ordinance 2016 has abolished the provision for serving notices on the companies through advertisement in newspaper to facilitate the corporate sector. Sources said if a member has no address in Pakistan, it will be mandatory to serve the notice on the address outside Pakistan given by the member. The provision of service to the members by courier and electronic means has been added in the new ordinance. The provision relating to service of notice through advertisement in newspaper has been abolished to facilitate the corporate sector.
Moreover, the courier service and electronic means added in the mode of service as well as the enabling provision empowering the Commission to prescribe any other manner have been added in the Companies Ordinance 2016. According to section 55 (Service of notice on a member) of the new Ordinance: (1) A document or information may be served on a member at his registered address or, if he has no registered address in Pakistan, to the address supplied by him to the company for the giving of notices to him against an acknowledgement or by post or courier service or through electronic means or in any other manner as may be specified.
(2) Where a notice is sent by post, service of the notice shall be deemed to be affected by properly addressing, prepaying and posting a letter containing the notice and, unless the contrary is proved, to have been affected at the time at which the letter will be delivered in the ordinary course of post.
(3) A notice may be given by the company to the joint-holders of a share by giving the notice to the joint-holder named first in the register in respect of the share.
(4) A notice may be given by the company to the person entitled to a share in consequence of the death or insolvency of a member in the manner provided under sub-section (1) addressed to them by name, or by the title or representatives of the deceased, or assignees of the insolvent, or by any like description, at the address, supplied for the purpose by the person claiming to be so entitled, it added.
The relevant section of the old Companies Ordinance 1984 said: Section 50 (Service of notice on members, etc).- (1) A notice may be given by a company to any member either personally or by sending it by post to him to his registered address or, if he has no registered address in Pakistan to the address, if any, within Pakistan supplied by him to the company for the giving of notices to him.
(2) Where a notice is sent by post, service of the notice shall be deemed to be affected by properly addressing, prepaying and posting a letter containing the notice and, unless the contrary is proved, to have been affected at the time at which the letter would be delivered in the ordinary course of post. (3) If a member has no registered address in Pakistan, and has not supplied to the company an address within Pakistan for the giving of notices to him, a notice addressed to him or to the shareholder generally and advertised in a newspaper circulating in the province or the part of Pakistan not forming part of a province in which the registered office of the company is situated shall be deemed to be duly given to him on the day on which the advertisement appears: Provided that in the case of a listed company such notice shall in addition to its being published as aforesaid be also published at least in one issue each of a daily newspaper in English language and a daily newspaper in a Urdu language having circulation in the province in which the stock exchange on which the company is listed is situated. (4) A notice may be given by the company to the joint-holders of a share by giving the notice to the joint-holder named first in the register in respect of the share, section added.