The first step towards incorporation of a company is to seek the “availability of name for the proposed company from the concerned registrar of companies. in terms of section 37 of the Companies Ordinance, 1984. Although, it sounds simple enough, but there are certain prohibitions and restrictions, the applicants have to look into while choosing a name for a company. Before applying for name reservation below to make sure that the proposed name complies with the following conditions on the website of SECP.
It is neither identical or nor closely resemble with the name of any existing company
It is not be inappropriate and deceptive
It doesn’t contain any prohibited word.
The application for name reservations can be filed under following three modes which are characterized on the basis of fee charged and processing time:
The application shall be submitted with normal fee on any working day for processing
The applicant shall apply for company name reservation either online or offline.
Post receiving the name availability certificate from SECP , the applicants have to file an application for incorporation. The fees associated with the process can be paid using the relevant bank form at designated branches of The Muslim Commercial Bank(MCB) in Pakistan.
Post payment of the fee, SECP then requires the applicant to submit the following documents
Memorandum of Association explains your business sector of the company e.g. Institution, Travel agency, Trading or manufacturing, Supply or chain of stores. To put simply, MOA tells about the relationship of your company with the outside world.
Articles of Association lets know about the day-to-day proceedings within the company i.e. what role CEO and directors would play, business concerned meetings and the appointments of employees, in short- how the company will run.
Any three or more persons associated for lawful purpose may, by subscribing their names to the Memorandum of Association and complying with the requirements of the Companies Ordinance form a public company and any two or more persons so associated may, in like manner, form a private company. If only one member forms a private company, it is called a single member private company.
Applicant may apply for the incorporation of the company either offline or online. Further, the application may be submitted with normal fee or through Fast Track Registration Services (FTRS) for urgent processing in 4 hours.
Foreign subscribers/directors/shareholders are required to submit the following undertaking for company incorporation and subsequent filing of returns. Undertaking is on the website of SECP.
|#||EVENT||TIME FRAME||RETURNS TO BE FILED WITH REGISTRAR|
|1||Appointment of first chief executive.||Within 15 days from the date of incorporation of the company.||
Form 29 within 14 days from the date of appointment of chief executive.
Public companies are also required to file Form 28 within 14 days from the date of appointment of chief executive.
|2||Appointment of first auditor.||Within 60 days from the date of incorporation of the company.||Form 29 within 14 days from the date of appointment of auditor.|
|3||Appointment of company secretary by a listed and single member company (SMC).||Within 14 days of incorporation of SMC and from the date of listing for listed companies.||Form 29 within 14 days from the date of appointment of company secretary.|
|4||Appointment of Legal Advisor||Every Company having paid up capital of Rs. 5 lakh and above shall appoint a legal advisor||Form 29 as and when company’s paid up capital reaches Rs. 5 lakh or above.|
Holding of Annual General Meeting (AGM) for
First AGM is required to be held within 18 months from the date of incorporation of the company and thereafter in each calendar year within 4 months from the close of the annual accounts and not more than 15 months after the holding of its last preceding annual general meeting
First election of directors is to be held in the first AGM and thereafter every three years.
If AGM is held by the company
|6||Appointment of subsequent chief executive.||Within 14 days from the date of election of directors or the office of chief executive falling vacant.||
Form 29 within 14 days from the date of appointment of subsequent chief executive.
Public companies are also required to file Form 28 within 14 days from the appointment of subsequent chief executive.
|7||Change in registered address.|
|8||Commencement of Business.||Public companies shall commence their business after obtaining certificate of commencement of business.||
|9||Statutory meeting by a public company having share capital.||Within three to six months from the date at which the company is entitled to commence business.||Five copies of Statutory report on Form 25 certified in the prescribed manner, at least 21 days before the date of Statutory Meeting.|
|10||Increase in authorized capital.||
|11||Further allotment of shares.||
|12||Return of Beneficial ownership and any change therein.||Form 31 within 30 days of occupying the position and Form 32 within 15 days of any change.|
The signature is granted by National Institutional Facilitation Technologies (NIFT) and can be obtained by using the electronic services of the SECP. After the certificate of incorporation is issued, the company representatives may be required to present a company seal, depending on the where the business will be head quartered or started. Some states also require a corporation to have a corporate seal, which is also sometimes referred as company seal.
To register for Income tax, the company will have to to apply for a National Tax Number (NTN) at the tax facilitation of the Regional Tax Office (RTO) of the Federal Board of Revenue (FBR). The requirements for this application include
Sales tax, like the income tax can be registered for, by applying for a Sales Tax Number (STN) at the tax facilitation centre of the Regional Tax Office (RTO) of the Federal Board of Revenue (FBR). For the professional tax, provided it applies, the company will have to register with Exercise and Taxation (ET) Department of the District.
Depending on the location of the business, the company will need to register with
Under the Employees Old Age Benefits Institution (EOBI), insured employees are entitled to a pension, upon retirement, invalidity in the case of disability, old-age grant and survivor’s pension. Every industry or a commercial establishment with five or more employees has to be registered with the Federal Employees Old age Benefits Institution (EOBI).
To safeguard the labor standard of the workers, all companies are required to registration with the District Chief Inspector of the labor department in each district. For registration, employer must submit the application form A accompanied with the relevant bank form.
Once these requirements are met and vetted by SECP, the company is then ready to become an independent operating body in Pakistan and will be treated as such.