Multan Metro Bus project: Alleged Chinese firm doesn’t exist in Pakistan, says SECP

LAHORE: The Securities and Exchange Commission of Pakistan (SECP), in a statement on Wednesday, strongly refuted the allegations being made by a section of the media that the officials of the commission are involved in delaying tactics for halting the investigations of the China Securities Regulatory Commission (CSRC).

In response to numerous reports and wide coverage of the subject, the Securities and Exchange Commission of Pakistan (SECP) shared the facts available with it related to the investigations of the China Securities Regulatory Commission (CRSC) into the affairs of Yabaite Technology Co. Ltd/Jiangsu Yabaite Technology Co. Ltd, a company listed on the Shenzhen Stock Exchange in China.

The SECP said that no team of CSRC ever visited Pakistan for an investigation or taking statements from certain individuals in Pakistan.

The SECP further rejected the contention being reported by a certain segment of the media that the Pakistani regulator is somehow using delaying tactics in provision of assistance/cooperation to CSRC. Being a member of the International Organization of Securities Commissions, the SECP fulfilled all its responsibility and cooperated with the CSRC for which the latter thanked the former many times. 

The SECP further stated that once the CSRC establishes that Yabaite committed a violation of the Chinese security laws, it will share a report of its findings with the SECP. So far the investigation by the Chinese authorities into the affairs of Yabaite is underway. The SECP cannot initiate any inquiry on its own in Pakistan and once the report is furnished by the Chinese regulator, the SECP will look into the violation of laws administered by it. 

The SECP clarified that no such company by the name of Capital Engineering & Construction Company was registered with it. It also inspected the office of the company for which the address was shared by the Chinese regulator but no office existed on that address.
The CSRC requested SECP for provision of such information as tender documents, contract, agreement and information relating to Multan Metro Bus Project. SECP is empowered by SECP Act 1997 to share such information with international regulators subject to confidentiality as per the International Organization of Securities Commission.

The SECP, after seeking authorization to share certain portions of CSRC request, gathered information from concerned authorities/companies such as Punjab Government, Pakistan Engineering Council, State Bank of Pakistan, Federal Board of Revenue, Yabaite Pakistan, Habib Rafique and Metracon Pakistan. SECP thanked all concerned for fully cooperating with regard to provision of the requested information.

The SECP stated that Yabaite China produced two letters before CSRC in July 2017 as proof of their involvement in the Multan Bus Metro Project. These letters were allegedly written by Punjab Chief Minister, Senator Kalsoom Parveen and Senator Mushahid Hussain Syed duly attested by Pakistan Foreign Office.

The SECP said that CSRC requested SECP for authenticity/validity of the letters. Henceforth SECP communicated with Chief Secretary Punjab, Senator Kalsoom Parveen, Senator Mushahid Hussain and Secretary, Ministry of Foreign Affairs regarding the authenticity of the letters. All denied having written/signed such letters and termed them as forgery. The findings of SECP in this regard were shared with CSRC.

CSRC informed the SECP on Wednesday (August 30) that the inquiry is still ongoing and they may not share any information with SECP before final decision is reached and made public and considering the confidentiality and independent nature of CSRC investigation process, they may not share investigation report at any stage.

CSRC further confirmed to the SECP that “during the investigation period of this case, the CSRC enforcement staff has neither inquired nor attempted to inquire officials from Pakistan or any Pakistani citizen. If they want to obtain information from Pakistani citizens in the future, they would request for this procedure to be conducted by SECP as assistance under IOSCOMMOU.

The CSRC confirmed that “based on CSRC’s existing investigation findings, they do not have any evidence showing that Yabaite has any business transactions with claimed Pakistani citizens or natural person.”

“Based on the above confirmations received today, SECP has sent letters to the Punjab Government, and FIA along with information/documents pertaining to SECP to hold independent investigation into the matter to ensure complete transparency and thorough independent investigation from Pakistan’ standpoint,” the SECP stated.

Available information from CSRC will be shared with the Punjab Government and FIA after seeking permission from the Chinese Regulator, the SECP added.