Company Setup Services in Pakistan
Are you considering to set up a Business entity in Pakistan?
What region in Pakistan to pick for company registration?
It is only possible to answer this question by having a clear vision of your goals and objectives and by understanding laws and rules of the land. Irrespective of the region you decide to operate your company within Pakistan from, the company will be registered with the Securities and Exchange Commission of Pakistan (SECP) and will be legally liable to operate according to the relevant compliance framework passed by the Commission or any other relevant regulatory body.
Once the nature and functioning of your company is determined we help you register your company with the relevant institutions.
Brief
The Securities and Exchange Commission of Pakistan (SECP) is the regulator of companies in Pakistan. The SECP is responsible for overseeing the registration and regulation of companies operating in Pakistan, including;
- Private Limited Company: This type of company is privately held and has limited liability for its owners. The company is required to have at least two shareholders and a maximum of fifty.
- Public Limited Company: This type of company is listed on a stock exchange and is publicly traded. It has a minimum of seven shareholders and is required to have a higher level of transparency and disclosure.
- Single Member Company: This type of company is owned by one person, who is also the sole director. This type of company is not required to have a minimum number of shareholders.
- Limited Liability Partnership (LLP): This type of company combines the features of a partnership and a limited liability company. The partners are not personally liable for the debts of the company and the company is considered a separate legal entity from its owners.
- Foreign Company: A foreign company is a company that is incorporated outside of Pakistan but operates in the country.
- Non-Profit Organization: This type of company is set up for the purpose of serving a social or charitable cause and does not distribute profits to its owners.
These are the main types of companies regulated by the SECP in Pakistan. The SECP is responsible for ensuring that these companies comply with the legal and regulatory requirements in the country.
Of the six types listed, small and medium companies typically register as either SMC (type 3) or Pvt Ltd LLC (type 1) while some law firms register as LLP (type 4).
We recommend that you to register as type 1 or 3 and will therefore explain them further. We shall begin with private limited companies, some of their key features are;
- Ownership: A private limited company is owned by private shareholders and is not publicly traded. There is a minimum of two shareholders and a maximum of fifty shareholders.
- Liability: The liability of the owners is limited to their invested capital in the company. This means that the owners are not personally responsible for the debts and obligations of the company.
- Management: The management of a private limited company is vested in its directors, who are appointed by the shareholders. The directors are responsible for running the day-to-day operations of the company.
- Capital: A private limited company must have a minimum paid-up capital of PKR 200,000.
- Reporting: Private limited companies are required to prepare and file financial statements with the SECP on an annual basis. They are also required to hold annual general meetings (AGMs) and provide regular reports to shareholders.
- Dissolution: A private limited company can be dissolved if the shareholders vote in favor of dissolution, or if the company is unable to meet its obligations and is declared insolvent by a court.
These are some of the key features of private limited companies in Pakistan. They provide a flexible and relatively straightforward way for entrepreneurs and investors to establish and run a business, while also limiting their personal exposure to risk.
Now moving to SMC(s), it is a type of company in Pakistan that is owned and operated by one person. Some key features of SMC(s) are;
- Ownership: A single member company is owned by one person, who is also the sole director of the company.
- Liability: The liability of the owners is limited to their invested capital in the company. This means that the owners are not personally responsible for the debts and obligations of the company.
- Management: The owner of a single member company is responsible for managing the day-to-day operations of the company.
- Capital: A single member company must have PKR 100,000 as paid up capital.
- Reporting: Single member companies are required to prepare and file financial statements with the SECP on an annual basis.
- Dissolution: A single member company can be dissolved by the owner at any time, or if the company is unable to meet its obligations and is declared insolvent by a court.
These are some of the key features of single member companies in Pakistan. This type of company is a simpler and less formal structure that is well-suited to small businesses or entrepreneurs who prefer to have complete control over their business. However, it is important to note that the owner is personally responsible for all debts and obligations of the company.