SECP receptive to address OICCI concerns on Companies Act 2017

KARACHI: Overseas Investors Chamber of Commerce and Industry (OICCI) has highlighted the importance of consistent, transparent and predictable long-term policies for improving the perception of foreign investors towards Pakistan’s business environment, a statement said on Friday.

OICCI highlighted these matters in a meeting held between SECP acting chairman Zafar Abdullah and a delegation of Overseas Investors Chamber of Commerce and Industry, it added.

Abdullah appreciated the initiative of OICCI in promptly highlighting genuine concerns and operational difficulties in implementing some of the provisions of the newly-introduced Companies Act 2017.

The meeting held at SECP office, Karachi was also attended by SECP commissioner Tahir Mahmood where OICCI team led by the secretary general M Abdul Aleem appreciated the proactive engagement of the SECP leadership with the key stakeholders and presented the top 10 concerns of the OICCI members, emanating from the newly-introduced Companies Act 2017, which affects the foreign investors.

The key issues discussed during the meeting, included extensive scope of related party transactions under section 208; section 452 relating to the companies’ global register of beneficial ownership, which is considered by OICCI as discriminatory and highly negative for attracting large investors; section 244, wherein all unclaimed dividend / shares after three years are to be deposited with the government as highly unfair with the shareholders and is not in line with the practice in developing economies in the region.

OICCI also presented its concern on Section 155 and 166 (number of directorships / selection of independent directors), section 172 (disqualification orders), section 180 (liabilities of directors and officers) and section 153 (ineligibility of certain persons to become directors).

The SECP acting chairman and Tahir Mahmood expressed their full support for addressing the genuine concerns taken up by OICCI and assured that a couple of issues, which are within the jurisdiction of the SECP, will be resolved under the law very soon, whereas other matters will also be addressed, if agreed by the regulators, through legislative process.

In the meantime, some obvious practical difficulties of the business entities to comply with the provisions of the Companies Act 2017 would be facilitated by deferring the timelines for compliance. Commenting on the meeting, M Abdul Aleem said, “The SECP has always given due consideration to foreign investors concerns communicated by OICCI and the meeting today was one more example of the SECP’s endeavour to give full support to the government’s effort to boost FDI in the country.”

OICCI is the largest chamber of commerce in terms of economic contributions in Pakistan. Nearly 200 OICCI members contribute about a third of the country’s total tax collections, invested $2.2 billion, last year in new investments and employ around one million people with a significantly larger contribution to the socioeconomic development of the community through their substantive CSR initiatives.