ISLAMABAD -  The government faced embarrassment in Senate on Thursday as the joint opposition with the help of at least two government-allied parties rejected the Companies Ordinance, 2016 with a majority vote.

The opposition through a resolution disapproved the Companies Ordinance 2016 with 50 votes polled in favour and 18 votes in opposition while two government allies - the Pakhtunkhwa Milli Awami Party (PkMAP) and the National Party (NP) also voted against the ordinance.

Some FATA lawmakers and independent lawmaker Mohsin Leghari sitting on the treasury benches also voted in favour of the resolution. As many as 40 lawmakers had signed the resolution to table it for the specially requisitioned session to disapprove the ordinance.

The National Assembly had already passed the ordinance that gives sweeping powers to the Security and Exchange Commission of Pakistan (SECP) for oversight of the accounts of companies registered with it and the government claims that the law would be helpful in stopping money-laundering.

Soon after PPP Senator Salim Mandviwala moved the resolution, Law Minister Zahid Hamid opposed it stating that the opposition was setting a new precedent of rejecting ordinances as the constitution had empowered the government to do so. The minister’s remarks led to a debate in the house. However, the opposition said that the government bypassed the parliament by introducing the law through an ordinance instead of a regular bill and this practice should be discouraged. The senators said that the ordinance was designed to change the entire economic and legal structure, meant for the companies.

Salim Mandviwala said that the style of the government to promulgate ordinances was not right and a law should be introduced through a bill, “Had the government adopted the proper way, we would have supported it,” he said. He pointed out that after the ordinance was tabled in the National Assembly as a bill, the SECP issued 7,7000 notices to different companies.

PPP Senator Farhatullah Babar said that the ordinance was meant to curtail jurisdiction of courts and already a trend was set with regards to the National Command and Authority Bill. “I would oppose it even if this had been presented in the Senate as a bill,” he said.

MQM Senator Tahir Mashhadi termed the ordinance a dictatorial step of the government while PPP Senator Sherry Rehman said the government was making basic amendments in the legal and regulatory framework for specific purposes. 

PPP Senator Taj Haider said that the constitution also provided a check for disapproval of an ordinance. He talked about its adverse impact on foreign investment and industry in Pakistan in its present shape.

The leader of the Opposition in Senate Aitzaz Ahsan said that the ordinance consisted of 1,224 pages, including annexures and such a huge ordinance could not be accepted.           

PkMAP Senator Sardar Muhammad Azam said that the ordinance was a move to whiten the black money by denying the Parliament of its fundamental right of legislation.

Zahid Hamid defended the ordinance and said that there was no limit of size while promulgating the ordinances. He agreed that wholesale changes were being made to revise the 32-year-old law and added that a lengthy process of consultation was held in this regard. He claimed that the law would a new impetus to the national economy. And it offered incentives to small and medium companies.

He urged that the ordinance should be referred to the house committee for further deliberations. He claimed the initiative was also a bid to bring significant improvement in doing business in Pakistan.

“Some people in the real estate business are opposing it who are afraid of provisions of disclosure (of wealth) in the law and getting under profit in the property business,” he said adding that otherwise, the law had the blessing of business community. The house also discussed a motion asking for the formation of a Parliamentary Committee on National Security. The lawmaker taking part in the discussion urged the government for the formation of the committee to oversee the implementation of the National Action Plan and all other operations being carried out by the army and the other law enforcement agencies to eradicate the menace of terrorism.