ISLAMABAD - Following its drive against non-governmental organisations (NGOs) failing to comply with the corporate laws, the Securities and Exchange Commission of Pakistan (SECP) has initiated action against 23 international NGOs to cancel their registration.
The 23 INGOs have failed to file their audited accounts despite several notices and are, therefore, presumed to be dormant. The SECP’s exercise to scrutinise the working and accounts of local NGOs has been extended to INGOs. In this regard, show-cause notices were issued to all INGOs that had not filed annual accounts and other overdue returns with the relevant registrars.
“Based on response of the INGOs regarding these notices and the record already available with the SECP, the state of compliance of the INGOs has remained unsatisfactory. Out of the total 33 INGOs registered with the SECP as foreign companies, 23 were found delinquent. Now, the SECP has approved action in terms of Section 439 of the 1984 Companies Ordinance to delete the names of these INGOs from the register of companies. The list of defaulting INGOs has already been shared with the Economic Affairs Division and the Ministry of Interior for information and necessary action,” said the statement issued by SECP.
Earlier, the SECP had revoked the licences of 208 local NGOs in two phases for not complying with the corporate laws. In the first phase, 108 were found to be in default in filing annual returns and accounts in April this year. They failed to apply for renewal of their licences within the specified time.
Therefore, the licences of these NGOs were revoked. In the second phase, the licences of 100 NGOs, which were partially compliant with filing their annual returns, but failed to apply for the renewal of licences, despite notices, were revoked.
It is worth mentioning here the government, in order to implement National Action Plan (NAP) to root out militancy and extremism, had asked the NGOs to get their licences renewed after a long debate on foreign funding for the NGOs for dubious activities, especially after the Peshawar carnage, which killed more than 140 people, mostly children and teachers.
Following the NAP, the SECP launched a comprehensive effort on January 1, 2015 against such companies, and instructions were issued to all concerned for compliance.
Of the total 643 NGOs registered under Section 42 of the Companies Ordinance 1984, 423 NGOs were required to get their licences renewed. Of these NGOs, the government has revoked the licences of 208 NGOs in last few months.
The SECP registers non-profit organisations under Section 42 of the Companies Ordinance and issues licences to them for a definite period of five years.
The NGOs were required to submit an application for the renewal of their licences along with copies of annual audited accounts, complete profiles of the chief executives and directors, statement of work, details of the amount of donations and the grants, statement from a chartered accountant that funds/grants/donations were received through banking channels and details of donors.