ISLAMABAD: Given the stress caused on businesses and the resulting challenges, the Securities and Exchange Commission of Pakistan (SECP) organised a Webinar on Corporate Rehabilitation Act, 2018 (CRA) and the Corporate Restructuring Companies Act, 2016 (CRC Act) to create awareness about corporate insolvency laws, a statement said on Thursday.
Honorable Justice Jawad Hassan, Commercial & Constitutional Judge of Lahore High Court was the chief guest. These laws provide a structured process for distressed companies to attempt their revival through corporate or financial restructuring plans and provide a well-defined mechanism for resolution of non-performing loans.
Justice Hassan supported the concept "A company alive is better than a company dead", introduced by the chairman of the SECP.
“Now when the laws are in place, we need to introduce the policies and create awareness regarding these laws so that the sick companies may be rehabilitated,” Justice Hassan said.
He added that the present government and the SECP had full support of judiciary in order to ensure that laws related to restructuring and rehabilitation of companies be implemented properly instead of winding up every other company.
Addressing the webinar, the Chairman SECP, Aamir Khan emphasised the importance of an efficient mechanism for resolving insolvency to reduce failure rate among businesses and preserve jobs. He further stated that resolving insolvency must be a priority and these laws had improved Pakistan’s position on World Bank’s doing business index. Khan stressed that real success depended on their effective implementation help surviving businesses from the adverse impact of the pandemic. Khan also highlighted the issue of non-performing loans of financial institutions, amounting to Rs853 billion as of Sept, 2020, that can be resolved through corporate restructuring companies.