Winding up of cos: SECP lays down criteria for appointment of managers, liquidators

The Securities and Exchange Commission of Pakistan (SECP) has laid down criteria for the appointment of panel of provisional managers and official liquidators for winding up of companies.

Through an SRO 1352 (I)/2019 issued here on Wednesday, the SECP has issued Panel of Provisional Managers and Official Liquidators Regulations, 2019.

Under the Companies Act, for the purpose of the winding up of companies by the Court, the Commission shall maintain a panel of persons from whom the Court shall appoint a provisional manager or official liquidator of a company ordered to be wound up.

The Commission shall maintain a panel of provisional managers and official liquidators. The provisional manager or official liquidator, as the case may be, already appointed by the Court under the Act before coming into force of these regulations, shall be exempt from the requirement of this regulation to the extent of such case for which the appointment was made.

An individual shall be ineligible to be included in the panel, if he is not a person resident in Pakistan is of unsound mind; has applied to be adjudicated as an insolvent and his application is pending; is an un-discharged insolvent; has been convicted by a court of law for any offence provided under the any law; has been debarred from being appointed as provisional manager or liquidator under the Act by the Competent Court; is lacking fiduciary behavior and a declaration to this effect has been made by the court at any time during the preceding five years; has been declared by a court of competent jurisdiction as defaulter in repayment of loan to a financial institution; in case of a Pakistani national, is not an income tax filer with Federal Board of Revenue.

Any person may apply to the Commission to be included in the Panel on Form-A along with all supporting documents as provided in Annexure-A and verified by an affidavit. The Commission may, while considering an application under this regulation, require the applicant to furnish such additional information, clarification, or documents as it deems appropriate.

The Commission on being satisfied that the applicant meets the eligibility criteria and other requirement of these regulations and the Act shall enter the name of the applicant in the Panel.

The Commission may, after affording reasonable opportunity of hearing to the applicant refuse to include the name of applicant in the Panel if in the opinion of the Commission such applicant does not meet the eligibility criteria and other requirements prescribed in the Act and these regulations. The entry of name of the applicant shall remain on the Panel unless removed by the Commission. The Commission may, in addition to the requirements, after providing a reasonable opportunity of representation to the provisional manager or official liquidator, remove his name from the Panel if at any time he becomes ineligible in terms of regulation 5; or order of his removal is passed by the Court in terms of the provision of the Act.

Copyright Business Recorder, 2019