KARACHI: While dismissing the complaints challenging Arshad Khurshid as Chairman of the All Pakistan Customs Agents Association (APCAA), the Directorate General of Trade Organisations (DGTO) has given APCAA 60 days to formally amend its bylaws to include the new definition and evidentiary standards.
In a comprehensive order issued by Regulator Bilal Khan Pasha, the office disposed of two interconnected complaints that had questioned both Khurshid’s eligibility to serve as Chairman and the validity of membership conversions for 19 APCAA members from Associate to Corporate class.
The first complaint, filed by M/s Sultan Enterprises in June 2025, alleged that Khurshid’s resignation, tendered via email in March 2025, had legally taken effect, thereby disqualifying him from Executive Committee membership and subsequent election as Chairman.
The Regulator, in its verdict, said that the resignation was never legally perfected under APCAA’s governing documents. While Article 15(v) of the association’s Articles of Association provides a general framework for resignations, Article 18 (iv) mandates a specific procedure requiring elected Executive Committee members to appear in person before the committee for confirmation.
“The mandatory procedural requirements of Article 18 (iv) were not fulfilled. The resignation was tendered, but the process was never completed,” the order said, affirming Khurshid’s continued membership and eligibility for the chairmanship.
The second complaint challenged the conversion of 19 members to Corporate class during 2023-2024, alleging that APCAA had relied on unreliable bank statements rather than authentic financial documents to verify “annual turnover”—the key criterion for Corporate membership eligibility.
In a significant regulatory intervention, the Regulator provided the first authoritative interpretation of “annual turnover” for trade organisations, defining it as “total gross receipts derived from ordinary business activities within a financial year, including gross fees for rendering services, exclusive of indirect taxes and non-operational receipts.”
Most notably, the order established a strict evidentiary hierarchy for future membership conversions. Trade organisations must now rely primarily on audited financial statements prepared in accordance with International Financial Reporting Standards (IFRS), or alternatively, complete annual income tax returns filed with the Federal Board of Revenue.
The practice of using bank statements or self-issued turnover certificates has been declared “insufficient and non-compliant” with the intent of the Trade Organisations Rules, 2013.
However, applying principles of fairness and legal certainty, the Regulator declined to retroactively invalidate the 19 conversions completed in 2023-2024, ruling they were “past and closed transactions” undertaken under prevailing practices. The new standards will apply prospectively to all future conversions.
APCAA has been given 60 days to formally amend its bylaws, incorporating the new definition and evidentiary standards. The association’s Secretary General received a formal warning for procedural lapses, including failure to maintain the organization’s website as mandated by regulations.
The Executive Committee was directed to ensure the Secretary General completes professional development courses on corporate governance and trade organization regulations within six months.
Copyright Business Recorder, 2025