Companies Bill a game changer: incorporation of cos to be doubled due to liberalised policy: SECP

Declaring new Companies Bill 2016 as game changer for entire corporate sector, chairman Securities and Exchange Commission of Pakistan (SECP) Zafar Hijazi expressed optimism that next year incorporation of companies would be doubled due to liberalized policy, facilitation and simplification for companies under the new law.
Talking to media here on Thursday, he termed approval of draft Companies Bill 2016 by federal cabinet as historic. The biggest law of the corporate sector has been approved which is a marvellous achievement of SECP. It took us 37 years to make a new companies law in 1984. In line with the global changes and practices, the SECP has drafted the Companies Bill 2016 inline with the best international practices.
The level of facilitation is so high under draft Companies Bill 2016 which would double the number of incorporation of companies next year. The new law would play key role in documentation of economy, ease of doing business and increase in number of companies.
Hijazi said that Insurance Act is the last law which needs to be revamped and hopefully its final draft will be completed in next thirty days.
He said that the incorporation process has been simplified under the new law. A survey conducted by the SECP revealed that the consultants/lawyers are charging fee ranging from Rs10,000 to Rs1.5 lakh for incorporation of companies with the SECP. The commission is charging fee of Rs10,000 for company's incorporation but consultants are charging huge fee for this purpose. The new companies' law would facilitate new companies to get incorporation certificate within one day.
According to him, after taking over as chairman SECP, he presented a detailed review of the legal framework available for capital market, corporate sector and insurance sector to the Finance Minister.
He said that revision of whole legal framework of the companies bill, that too in a short while is the need of the hour and it should meet the standards of today and that will not be possible without the help and support of the government on this, the finance minister assured the SECP of all possible support of the government.
The chairman SECP said that the current legal framework for the capital market and the corporate sector in Pakistan has been updated according to the needs of today and is in accordance with the developed countries standards.
He said that before this, basic acts like Securities and Exchange (amendment) Act, 2016, Securities Act, 2015 and Futures Market Act, 2016 have already been approved and implemented. He said the Companies Bill will also be approved by parliament soon.
Hijazi said that the Companies Act is the base for a prudent corporate sector and SECP officials had been working day and night on its modernisation. He said that Companies Act was implemented in 1913 and it took us 37 years to bring necessary amendments to it.
Irtiza Hussain, chairman Corporate Law Authority strived to achieve this milestone and eventually implemented it in 1984 as Companies Ordinance, 1984. After this 21 years later in 2005 rapid changes occurred in the corporate sector due to which large scale changes were required to be made in the Companies Law and the then Chairman, SECP, Dr Tariq Hassan under the supervision of former Justice Ajmal Mian formed Companies Law Reforms Commission which included Law Experts, Chartered Accountants and Businessmen who presented a conceptual overview but unfortunately no further steps were taken in this regard.
Hijazi said that 4 months after assuming the responsibilities of Chairman, SECP, he personally looked into the work done on the Companies Law and formed a committee which consisted of highly professional personnel of the SECP and personal requests were made to famed chartered accountant, Mr. Ibrahim Saadat and expert lawyer Dr Pervaiz Hassan to do the job.
This committee completed the draft of Companies Law till December, 2015 and then in January and February 2016, seminars were conducted in Lahore, Faisalabad, Multan, Karachi, Islamabad, Peshawar and Quetta which were attended by chartered accountants, lawyers and professionals from the corporate sector. After listening to the stakeholders the committee presented another draft of the Companies Bill to the Commission. SECP held a seminar in Islamabad and the Finance Minister was invited to chair the event. The seminar was held on March, 26 2016 in Marriot Islamabad and well known lawyers Dr Tariq Hassan, Asad Ali Shah, Chartered Accountants and other professionals gave their critical review regarding the bill.
Finance Minister praised SECP's efforts of consultation with public and the stakeholders. Given the importance of this law more consultation sessions were held on the advice of the Finance Minister so on April, 7 2016 with the co-ordination of IFC and World Bank a session was held in Lahore, on 13th April 2016 with the co-ordination of Institute of Chartered Accountant of Pakistan a seminar was conducted, on May, 12 2016 a detailed meeting with Institute of Cost and Management Accountants of Pakistan took place on the 30th of May 2016 a seminar was held in co-ordination with Institute of Chartered Accountant of Pakistan in Islamabad and another seminar with the help of IFC, World Bank and CIPE was conducted in Islamabad on 2nd June 2016. After these consultative meetings, sessions and seminars SECP held a final seminar on the 5th of September 2016 in Karachi for which once again the Finance Minister was invited to chair the event. In this seminar the draft was finalised after detailed review of the law. In this lengthy process along with Ibrahim Saadat and Dr Pervaiz Hassan, Masood Naqvi, Dr Tariq Hassan, Muhammad Hayat Jasra, Abdul Rehman Qureshi, Hafiz Muhammad Yousaf, Kashif Mateen Ansari, Hameed Chaudhry, Rashid Anwar, Nazeer Ahmad Shaheen, Qamar-ul-Islam, Dr Khalid Ranjha and Rafiq Rajwana, now is governor Punjab provided expert opinions to SECP on Draft Company's law on which the SECP is very thankful.
Finance Minister Ishaq Dar has made significant contributions in completing the draft of Companies Bill. I am grateful to him that he personally attended two seminars organized by the SECP on the Companies Law draft and also gave comprehensive feedback and suggestions on various sections of the draft law during the three detailed sessions held in the Ministry of Finance for reviewing the bill. He said that he is also thankful to the members of Standing Committees of Finance of the National Assembly and the Senate of Pakistan who provided great support in getting the SECP related laws approved by the Parliament.
Zafar Hijazi also said the SECP will finalise the Draft of the new insurance law by the end of current year. He said that the SECP officials proved that they are capable to fulfil the requirements and needs of the modern times. He thanked Allah that the SECP is playing its due role in national economic development. He appreciated all the SECP officers and staff in achieving this milestone, he added.