ISLAMABAD - A parliamentary committee on Thursday approved the Companies Bill, 2017, which would facilitate the country’s corporate sector by providing simplified procedures for ease of starting and doing business and protection of investors.

The Senate Standing Committee on Finance and Revenue with Senator Saleem Mandviwalla in the chair approved the Companies Bill, 2017, after proposing certain changes. The Bill, which is meant to replace the Companies Ordinance, 1984, was passed by the National Assembly on February 6, 2017.

The Bill along with the amendments will soon be placed before the Senate. Though the National Assembly has already passed the bill, it will go back to the lower house of parliament once again for final voting due to changes proposed by the Senate panel. The more than 500-clause bill, the Companies Bill, 2017, is meant to consolidate the law and encourage corporatisation in the country based on best international practices.

The Senate committee convened nine sessions to discuss the Bill clause by clause and proposed certain changes after detailed deliberations. The proposed changes aim to empower women, enhance rights of disabled people and ensure ease of doing business.

The major changes proposed by the committee include provisions for mandatory presence of a woman member on the boards of companies to be notified by the SECP. The procedures regarding signing of statutory returns and making changes in the memorandum of association of the company have been simplified. The provision for winding up companies by the courts has been rationalised. Further, any major change in the shareholding of the company shall be reported to the SECP in an expeditious manner.

The mechanism has been introduced to enable companies to indemnify their officers through insurance cover. The SECP has been empowered to increase the limit of paid-up capital beyond ten million rupees for mandatory filing of audited financial statements by the private company. Every public interest company, which has 50 or more employees, will be required to hire two percent disabled individuals.

The Bill contains provisions for simplifying the procedure for incorporation of companies, enabling maximum use of technology, encouraging paperless environment at all levels and relaxations to small and medium enterprises.

The law will facilitate the growth of economy in general and the corporate sector in particular by providing simplified procedures for ease of starting and doing business, greater protection of investors and corporatisation in the country. The committee recommended that all transactions be made by the directors of companies through banking channel in order to encourage the documentation of economy.

Senator Saleem Mandviwalla said the Committee had a threadbare discussion on Companies Ordinance 2017 and deliberated it clause wise. He further said that concerns of business community had been addressed. The committee has tried its level best to incorporate maximum proposals from the business community. The committee made 39 amendments to the Ordinance, he added.

The committee did a public hearing to seek proposals from the business community. During the proceedings, the Pakistan Business Council, Overseas Chamber of Commerce, FPCCI, real estate sector, ICAP, ICMA, All Pakistan Chambers of Commerce and Industry and the business community submitted their proposals. 

Mandviwalla said the bill would help ensure ease of doing business in Pakistan and help the business community. Committee member, Senator Kamil Ali Agha said that it would restore investors’ confidence and promote the corporate sector of the country.

Meanwhile, the SECP chairman thanked the Senate, National Assembly and members of the standing committees for sparing their time and adding value to the bill. He said the corporate law had been revamped to bring it on a par with the international standards after 33 years. He expressed the hope that this bill would prove a game changer for the Pakistani economy.