Securities and Exchange Commission of Pakistan

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Final Report

Submitted By
Muhammad Anas FA16-BBA-052
Ali Muhammad FA16-BBA-069
Ifrah Ali FA16-BBA-086
Zainab Rameen FA16-BBA-081

Corporate Law
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ACKNOWLEDGEMENT

Our group have generated this report with great effort. However, it would not have been
possible without our group members internal coordination and with the kind support and
guidance of our Professor Sir Hafiz Muhammad Adnan. Our group members would like
to pay sincere regards and thanks to our professor for their efforts.

We all are very great full to our professor for their constant supervision as well as for
providing necessary information for the completion of our report.

We all are very thankful to our University, COMSATS University of Islamabad that they
provided us such a kind, professional, cooperative, hardworking and senior Professor
who helped us a lot in our project.

At the end our appreciation goes to all of our group members who showed great effort
and motivation towards completion of this project without them it was not possible to
complete this project.
 TABLE OF CONTENTS
EXECUTIVE SUMMARY…………………………………………….......................................1
PURPOSE:.....................................................................................................................................1
METHODS: ...................................................................................................................................1
CONCLUSION:........................................................................................................................................ 1
MISSION AND VISION OF SECP ..................................................................................................... 2
MISSION: ................................................................................................................................................. 2
VISION: .................................................................................................................................................... 2
INRODUCTIONTO SECP .................................................................................................................... 3
FUNCTIONS OF SECP.......................................................................................................................... 5
COMMISSION OF PAKISTAN .......................................................................................................... 7
ESTABLISHMENT OF THE COMMISSION: ....................................................................................... 7
HEAD OFFICE: ....................................................................................................................................... 7
THE COMMISSIONERS: ........................................................................................................................ 7
6. THE CHAIRMAN: ............................................................................................................................... 7
7. TERM OF OFFICE OF THE COMMISSIONERS: ............................................................................. 7
8. APPOINTMENT OF EMPLOYEES OF THE COMMISSION: ......................................................... 8
9. APPOINTMENT OF ADVISERS AND CONSULTANTS: ............................................................... 8
10. DELEGATION OF THE COMMISSION'S FUNCTIONS OR POWERS:....................................... 8
11. THE COMMISSION TO FURNISH INFORMATION: .................................................................... 8
INCORPORATION OF A COMPANY ............................................................................................. 9
CHALLAN ................................................................................................................................................. 13
DIRECTORS........................................................................................................................................... 14
CREDITORS MAY NOMINATE THE DIRECTORS .............................................................................. 16
CONSENT TO ACT AS A DIRECTOR FILLED WITH A REGISTRAR ............................................... 16
MEETINGS ............................................................................................................................................. 19
QUORUM ................................................................................................................................................... 22
POWER OF THE COURT TO DECLARE THE PROCEEDINGS OF A GENERAL MEETING
INVALID .................................................................................................................................................... 23
MINUTES OF MEETING .......................................................................................................................... 23
INSPECTION OF RECORDS OF RESOLUTIONS AND MEETINGS. .................................................. 24
CONCLUSION ....................................................................................................................................... 25
REFERENCES ....................................................................................................................................... 26

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 EXECUTIVE SUMMARY
PURPOSE:
The purpose of this report is to introduce the SECP, its structure, its functions, its working, its
responsibilities, its major roles in our economy’s growth and success of the country.
METHODS:
Our group didn’t use any technical methods to made this report we simply consulted the
Company Law of Pakistan to understand the functions of SECP and generated this report which
is totally according to the information set under the Act and there are no changes in those rules
and regulation.
RESULTS:
By generating this report, we came to know the basic functions of SECP and how it is managing
the matters of the country and how efficiently it is performing its functions. The structure and
process SECP follow to perform any function.
CONCLUSION:
This report has been conducted by using the Company Law that is made by the Governing body
of Pakistan under Act 2017. This report is made to identify the basic purpose of the formation of
SECP. It also explains the responsibilities, functions and working of SECP. SECP is an
institution that is responsible for the formation, winding up, dissolution etc., of a company, it
also looks after the financial matters, economic growth, success peace of the country. This report
explains the whole structure of the SECP that what is the process of formation of any kind of
company (PVT Ltd, Public Ltd, Single member company), the functions of SECP, the
introduction and location of SECP.

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MISSION AND VISION OF SECP

MISSION:
The mission of SECP is to develop such a system that supports a fair, efficient and
transparent regulatory frame work on the basis of international legal standards and best
and reasonable prices, to increase the trade of the country, to maintain peace and stability
in the country, to protect investors, to improve and rebuild the economic and corporate
sector of Pakistan.
VISION:
SECP’s vision is to develop modern and efficient corporate sector and capital market
based on specific rules and principles. It helps to increase the economic growth and foster
social harmony and peace in the country.

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INRODUCTIONTO SECP

The Securities and Exchange Commission of Pakistan (SECP) is an Official Financial

Regulatory Authority in Pakistan whose aim is to maintain peace and
established business sector and a business market based on governing principles,
international standards, prices and much more, to promote economic growth and
success in Pakistan.
Corporate Law Authority was responsible for looking after the matters of financial
sectors and institutions before SECP’s formation. In December 1997 an act was passed
by the Parliament of Pakistan named Securities and Exchange of Commission to regulate
the capital market.
This Act gave the authority to SECP to carry out basic functions and regulate the daily
system of the country. SECP is responsible for regulating the legal and financial matters
of the country. It has the authority to look after the corporate sector, center market,
incorporate supervision and regulation of insurance agencies, non-banking investments
companies and private allowances. Supervision of external service allotted to SECP
includes commercial sectors, chartered accountants, credit rating agencies, corporate
desks, brokers, evaluators etc.
Operational and executive authority of the SECP is with the Chairman who is the SECP’s
Chief Executive Officer (CEO).

The SECP is divided into the following 5 divisions:

• Company Law Division

• Securities Market Division
• Specialized Companies Division
• Insurance Division
• Law Division

FORMED ON: 1ST January 1999

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HEAD OFFICE OF SECP:NIC Building, Jinnah Avenue, Blue Area Islamabad,

Pakistan
REGIONAL OFFICE: Company registration offices (CRO) in Karachi, Lahore,
Peshawar, Sukkur, Multan, Faisalabad and Quetta
POSTAL ADDRESS OF SECP: National Insurance Corporation Building, Jinnah
Avenue, Islamabad-44000, Pakistan.
OFFICIAL WEBSITE: www.secp.gov.pk

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FUNCTIONS OF SECP

(1) Under this Act the Commission shall have all the powers necessary to perform its
specific duties and functions.
(2) The Commission have the power to its functions and to exercise its powers efficiently
(3) The Commission shall take actions timely to identify the matters regarding policy
making by the Board
(4) The Commission shall be responsible for the performance of the following functions:

(a) regulating the securities issues;

(b) regulation of business in securities markets;
(c) supervise and monitor the activities of any central depository and Stock Exchange
clearing house;
(d) registration and regulation of the intermediaries associated with the securities markets
(e) regulating the working of collective investment schemes
(f) promotion and regulation self-regulatory organizations
(g) prohibition of fraud and unfair trade practices relating to securities markets;
(h) promotion of investors education and training of intermediaries of securities markets;
(i) to investigate the violence of matters related to this Act and the Ordinance to secure
the insider trading of securities and to prosecute offenders;
(j) regulating and merging the shares to take over the companies;
(k) stock audification and justification after collecting information
Exchanges and intermediaries and self-regulatory organizations in the securities market;

(I) considerations and suggestions for law relating activities and for body corporate
(m) encouraging institutions for investment
(n) conducting research
(o) performing such functions and exercising such powers of the Authority, including any
powers of the Federal Government delegated to the Authority, (other than the power to
make any rules or regulations) under the provisions of the Ordinance, and under any
other law for the time being in force under which any function or power has been
conferred on the Authority including, but not limited to. the functions and powers set out
in the Schedule to this Act;
(p) powers and authorities to perform or to declare something according to provision
given in the ordinance or in the companies act.
(q) proposing regulations, the consideration and approval of the Board.

(5) the approval of the Commission should be

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(a)the companies which want to sell their securities outside the Pakistan via directly or
indirectly or through some channel or distributor or party
(b)the business other than the companies want to issue their securities to the people of
Pakistan and want to expand their business in Pakistan
(c) listing of securities of corporate bodies outside Pakistan

(6) the Commission shall perform and function to achieve

(a) maintenance of facilities for better development of the economy
(b) to encourage investors to show interest in the securities markets
(c) to achieve perfection in exercise those powers;
(d) to administer laws effectively
(e) to process the documents efficiently under this Act
(f) to ensure that the information in clause
(e) are available for access
(g) to take actions to enforce Act and the Ordinance or any other law.

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COMMISSION OF PAKISTAN
ESTABLISHMENT OF THE COMMISSION:
(1) A commission is established called the Securities and Exchange Commission of
Pakistan.
(2) The Commission is a body corporate with perpetual succession and a common seal,
that can make contracts, purchases, have right on moveable and immovable property
HEAD OFFICE:
The head office of the Commission shall be in Islamabad. The Commission have the
authority to establish and close down offices.
THE COMMISSIONERS:
(1) Subject to sub-section (2), the Commission consists of number of Commissioners,
including the Chairman, appointed by the Federal Government, the number of
commissioners shall not be less than five and more than seven. A Commissioner shall be
a person who is known for his integrity, expertise, experience and eminence in any
relevant field, including the securities market. law. accountancy, economics, finance and
industry.
(2) The majority of the Commissioners shall be private.
(3) every function and exercise should be done in the provision of this Act and under the
regulations made by the Board.
THE CHAIRMAN:
(1) one of the Commissioners should be the Chairman of the Commission appointed by
the Federal Government of the country.
(2) The Chairman of the Commission shall be the chief executive officer and shall be
responsible for daily affairs of the commission.
TERM OF OFFICE OF THE COMMISSIONERS:
(1) Term A in which the Chairman is excluded, under this Act three of the commissioners
are selected at a random ballot for two years by term A and on the expiration of this term
the next three members are selected as a commissioner for further three years. Similarly,
Term B in which the Chairman of the Commission is included the three members are

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selected for three years and on the expiration of this term next three commissioners are
selected for further three years.
(2) At the end of five years the new Commissioners are appointed on the basis of
prescribed rules and regulations. According to the eligibility criteria of persons who want
to join the post for a commission.
APPOINTMENT OF EMPLOYEES OF THE COMMISSION:
(1) By the approval of the Board the Commission shall hire the employees on time and
shall pay them remuneration and allowances.
(2) With the approval of the Board the employees shall be liable
APPOINTMENT OF ADVISERS AND CONSULTANTS:
(1) Subject to sub-section (2).the Commission shall employ such employees, lawyers,
consultants, businessman, accountants, marketers, financers and professionals to perform
the function of this Act or implement it.
(2) Every decision regarding employment of external advisors shall be made by the
Commission with the approval and consent of Board timely.

DELEGATION OF THE COMMISSION'S FUNCTIONS OR POWERS:

(1) The Commission shall impose such limitations and conditions that fit the
requirements of the delegation with one or more than one Commissioner or any officer of
the Commission.
(2) A delegation under this section shall not prevent the concurrent performance or
exercise by the Commission.
THE COMMISSION TO FURNISH INFORMATION:
The Commission shall give information to the Federal Government or the Board about
the policies to perform any functions under the Act timely.

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INCORPORATION OF A COMPANY
Any three or more persons associated for lawful purpose may, by subscribing their names to the
Memorandum of Association and complying with the requirements of the company Act,2017
form a public company. Any two or more persons so associated may, in like manner, form a
private company. If only one member forms a private company, it is called a single member
company. SECP is the regulatory body where all companies of Pakistan are register under the
company act 2017 or any previous.

1. RESERVATION OF NAME
Any person desirous of forming a company have to fill separate or combined application
for reservation of name and incorporation of company. you can submit this form through
e-service or in physical form. In application you should submit 3 names to SECP. If
SECP approved your name you have to register your company within 60 days. If
person/applicant fail to file application of incorporation of company within the given
period, name will be cancelled or register to another. If SECP reject your names then you
have to submit appeal to commission within 30 days. In case of refusal of name, the
register should issue the order of refusal and application of incorporation should be held
pending.
CHANGE OF NAME
General (Shareholder) meeting Special resolution (Dealing with special business 3/4
majority 75% need to approve)You have to tell all members before 21 days of meeting. If
you want to change the form of business from private to public you don't have to follow
the whole procedure just tell SECP to change the name in their register.
PUBLICATION OF NAME
If company change its name and new name is provided so its compulsory for company to
use previous name with new name for 90 days. It is published on every document for 90
days. If any company who don't follow the procedure of publication of name then penalty
of level 1 would be charged.
2. PROHIBITION OF CERTAIN NAME
Name of company should be appropriate. Inappropriate name should be rejected like if
you are running a vehicle company and you name it Honda sugar this is inappropriate.
You should not choose name which is related to religion and harm religious sentiments.

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3. APPLICATION OF INCORPORATION OF COMPANY

An applicant shall make an application through e-service or in physical form to register
for incorporation of company with the following documents
(i) Memorandum of Association
(ii) Articles of Association, where required
(iii) Copies of CNIC/NICOP of the subscribers/directors/chief executive officer or
copies of Passport in case of a foreigner
(iv) Copy of CNIC/NICOP of Nominee only in case of single member company or
copy of Passport in case of a foreigner
(v) Copy of CNIC of witness in case of physical filing
(vi) Authorization for filing of documents for the proposed company by the
subscribers as per Annexure-V in favor of either one of them or registered
intermediary
(vii) NOC/Letter of Intent/ License (if any) of the relevant regulatory authority in case
of specialized business as mentioned in regulation 4
(viii)Original paid bank challan evidencing the payment of fee specified in Seventh
Schedule of the Act.
4. MEMORANDUM OF ASSOCIATION
MOA is an external constitution of a company. Registration of memorandum is
considered as registration of a company.MOA deals with
1) NAME CLAUSE
(as mentioned above)
2) REGISTERED OFFICE CLAUSE
Registered office of company will be situated in the province where company is situated.
Registered office is the office of a company where company send or receive all type of
communication. There will be no more than one register office.
3) PRINCIPLE LINE BUSINESS CLAUSE
Company should tell objectives in it. What is the purpose of formation of company? If it
is mention than company only do this. Company can do more than one business but with
same principle line.

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4) LIABILITY CLAUSE
This clause states that liability of member is limited to the extent of share and guarantee.
5) AUTHORIZE CAPITAL CLAUSE
It can be authorized by the SECP. Company should tell their registered capital than
divide it in shares. For example: 1 lac capital divide into share if share price is 20 rupees
then 5000 shares.
6)UNDERTAKING CLAUSE
All members of company signed on one stamp paper that company will not be engaged in
any of the restricted business that affects the security of Pakistan.
7)SUBSCRIPTION CLAUSE
Name of members and number of shares are written in it. There are two types of member
Initial Members (Subscribed on Memorandum)
Subsequent (Those members who buy share after registration)
Name Father name CNIC Designation No. of share
ALTERATION OF MOA (REGISTERED OFFICE CLAUSE)
1)CITY OF ONE PROVINCE TO ANOTHER CITY
a-Special Resolution
b-Note to registrar
2)PROVINCE TO ANOTHER PROVINCE
a-Special Resolution
b-Approved from Commission
Commission asked from members before approval that are you send sufficient notice to
the creditors. Commission asked from creditors that are you allowing for change of
office. Commission allow company to change office but order that previous office will
remain there as sub office for the dealing of creditors for two years. Minority shareholder
are those shareholders who have less shares if they don't agree to change the office than
request will be cancelled. But if they buy the shares of minority shareholders then office
will be changed.
3)ORDER SEND TO COMPANY AS WELL AS REGISTRAR
4)30 DAYS FILE DOCUMENT TO REGISTRAR

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5)PRINCIPLE LINE BUSINESS

The alteration of PLB is same as Register office clause
6)AUTHORIZE
In authorization special resolution will be passed then notification will be filed in 30
days.
5. ARTICLE OF ASSOCIATION
Article of association is considered as internal constitution of a company. The subscribers
of the company limited by share may adopt the article of association as per table A of
schedule1.In case of company limited by guarantee or unlimited company, article of
association shall be signed by the persons who are subscriber to the memorandum with
the registrar along with application of incorporation. If the subscriber is a body corporate,
article of association shall be signed by the natural person on the behalf by a resolution of
board of directors of the body corporate.
Class of company Table of applicable
Company limited by shares Table-A
Company limited by guarantee or not having share capital Table-C
Company limited by guarantee or having share capital Table-D
Unlimited company Table-E
6. APPOINTMENT OF FIRST DIRECTORS AND CHIEF EXECUTIVE OFFICER
The number of directors and the names of the first directors are decided by the subscriber
of memorandum under the provision of section 157 of the act. The name of first chief
executive is also decided by the subscriber of memorandum under the provision of
section 186 of the act. These directors and chief executive shell b stated in the application
of incorporation of company as per Annexure-IV
7. OTHER INFORMATION TO BE PROVIDED
a-In case of Pakistani subscriber, a person specifies his national identity card number and
in the case of foreign national, his passport number.
b-In case of a person who is not a natural person, the address of its registered office or
principle office shall be mentioned.
8. WITNESS IN CASE OF PHYSICAL SUBMISSION OF A DOCUMENT

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a-In case of electronic submission of application for incorporation witness is not required
in terms of Section 3 of Electronic Transactions Ordinance, 2002.
b-In case of physical submission of application for incorporation witness is required by
Pakistani National having valid CNIC.
9. EXAMINATION OF DOCUMENTS BY THE REGISTRAR
a-The registrar shall check the documents which is submitted for registration of a
company and if he/she satisfy with the documents all rules and regulations are followed
in incorporation of the company, he shall register the memorandum and documents
delivered to him.
b-If deficiencies are found by the registrar in the documents, the applicant should be
informed in writing of resolution and applicant should remove these deficiencies and
provide right information within 7 days.
c-If response is not received by the applicant within 7 days, reminder shall be issued by
the registrar.
d-If no response is received or applicant fails to remove deficiencies within 7 days, the
registration of the memorandum may be refused.
10. ADDITIONAL REQUIREMENTS FOR AN ASSOCIATION NOT FOR PROFIT
License can be provided to those subscribers to the memorandum of association who are
working not for profit.
11. COMMENCEMENT OF BUSINESS CERTIFICATE
On registration of memorandum of association of a company, the registrar shall issue a
certificate under his signatures and authorized by his official seal. Public company can't
start a business until they get commencement of business certificate.
Requirements of Commencement of business certificate
Minimum subscription
Directors share
Unpaid amount return to shareholder
Declaration of compliance

CHALLAN

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DIRECTORS
Directors are the persons responsible for the management of a company. A person can become a
director in any of the following three manners. These are the basically representatives of a
company appointed by the shareholders:

I. Through election in a general meeting

II. Through nominations made by holders of specific interest (PICIC, a statutory corporation
directly or indirectly owned by federal or a provincial government who have invested in
the company. Federal or a provincial government or foreign equity holders of PICIC or
any other corporation formed under any corporation arrangement) specified in section
183:
III. By appointment as first directors, chief executive, a full-time employee of the company,
and a director appointed to fill the casual vacancy.
‘’Director’’ includes any person occupying the position of a director by whatever name
called.
Company Minimum member
Single member company One
Private company two
Public limited (unlisted) three
Public company (listed) seven
APPOINTED DIRECTORS:
The numbers of directors and names of first directors shall be determined by the
subscribers
(a) on the date of first annual general meeting; or
(b) in case of subsequent directors on expiry of term of office of directors mentioned in
section 161, shall stand retired from office and the directors so retiring shall continue to
perform their functions until their successors are elected.
(2) The directors so continuing to perform their functions shall take immediate steps to
hold the election of directors and in case of any difficulties report such circumstances to
the registrar within forty-five days before the due date of the annual general meeting or
extra ordinary general meeting, as the case may be, in which elections are to be held:

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ELECTION PROCEDURE
Procedure for electing the directors an according to the section 178(having share capital)
1. The company has to fix the number of elected directors at least 35 days before the
general meeting, in which election to be held
2. The number of directors cannot change except with the prior approval in general
meeting of the company.
3. The notice given about the election to all members that numbers of directors to be
elected and the names of retiring directors
4. A notice should be given by a person who wants to participate in the election at
least 14 days before meeting. The notice can be withdrawing any time before
holding of meeting
5. The notices must be circulated with the members before 7 days of meeting. In
case of listed company such notice must be published in one Urdu and one
English daily newspaper in that province where its securities are traded.
6. If the number of directors exceed the fixed number who are participation in
election process than shareholders appoint in following manner:
• Each member shall have the total votes equal to the voting shares
multiplied by the numbers of directors to be elected,
• Members has choice to give his vote to one or more than one person
• The member who has highest votes are elected as director of company
than second highest vote take and so on.
7. The company not having share capital procedure of electing directors in that
company is stated in articles sec178)
8. Any person who is nominated as a director of a public and modaraba company
whose share are traded in stock exchange or banking company shall file the
consent under section 184,a declaration on oath attested by oath commissioner
• A declaration that no loan is obtained from any financial institution, corporate
body in his own name, his spouse, dependent children and parents and if loan is
taken it should be paid within one year

• Declaration the above given persons had no default in payment of taxes

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• Declaration that above given persons had paid government, utilities bills,
including telephone, electricity and gas bills
• A declaration of educational qualifications, occupation, identity number and tax
number if he or she had
• A declaration of assets and liabilities of his own, his spouse and dependents on
fiscal year.
• A declaration about the income tax, wealth tax during last three years where
applicable land revenue paid by him during the last two financial years.

• FRESH ELECTION OF DIRECTORS ON REQUEST OF SUBSTANTIAL

ACQUIRER IN CASE OF UNLISTED COMPANY
• The person which has 12.5% or more voting shares in listed company he can
apply commission for requiring the company to hold fresh election of director as
the procedure laid down.
• The person who applied for new election cannot sell its shares or transfer’s up to
one year.
CIRCUMSTANCES IN WHICH ELECTION DECLARED INVALID
• The court may be called election invalid if the persons more than 30% satisfy them that
election are based on irregularity and thereto.

CREDITORS MAY NOMINATE THE DIRECTORS

They can nominate directors having contractual arrangement. They can appoint director
directly and indirectly from corporate body and other. directors nominated by foreign
equity holders on the board or any other body corporate set up under a regional co-
operation or other co-operation arrangement approved by the Federal Government.

CONSENT TO ACT AS A DIRECTOR FILLED WITH A REGISTRAR

• No person can act as a director without giving the writing consent to the registrar
• Within fourteen days from nomination of directors a company must shall file the names
of persons along with consent in prescribed form to the registrar.
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• This section shall not apply to private company, not being

a private company, which is a subsidiary of public company.
VALIDITY OF ACTS OF DIRECTORS:
If a defect is found in appointment of directors the previous meeting and decisions will be
considered is valid but from the moment the defect is found the director will not continue
his practicing.
IN CASE OF DEATH OF DIRECTOR:
Casual vacancy means the office of a director or a seat of a director becomes empty by
four ways:
Death of director
Director becomes insolvent
Disqualification
Resignation by director
PROCEDURE TO FILL VACANCY
• Check any provisions given the articles of association
• Holding a board meeting
• Collect the declaration and consent of nominated director
• Passing a resolution for appointing new director
• Make necessary entries and other formalities
• To inform the registrar within 90 days
• Also, if the deceased was a director of the company (in case of unlisted companies), the
nominee acquiring the shares as trustee shall act as director of the company to protect the
interest of the legal heirs.
• In case of single member company nominee director will be appointed in case of non-
availability and death of a single member.

INELIGIBILITY TO BECOME A DIRECTOR:

• The person cannot become director if he has following characteristics:

• Less than 18 years or criteria whatever
• Has unsound mind
• Declared insolvent

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• Is not a member(whole time member employees etc.)?

• Is a defaulter of government taxes, bills and any other litigations.
• Involved in violating the sentiments or moral turpitude

We can say that any normal person that can become director. Through which he or she
passes some rules and regulation to become a director.

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MEETINGS
STATUTORY MEETING OF A COMPANY

1) Each public company which have a share capital shall, within a time of 6 months from
the date at which it’s entitled to commence business, hold a general meeting of the
members of a company called ‘statutory meeting’.
2) The members should be notified within 21 days about the fixed date of statutory meeting
along with the copy of statutory report.
3) The statutory report shall state:
• Total number of shares allotted other than in cash and stating the consideration for
which they have been allotted.
• The amount of cash received in respect of all shares allotted.
• The names, addresses, and occupations of the directors, chief executive, secretary,
auditors and legal advisers of the company and if any changes have occurred from
the date of incorporation.
• The particulars of modification of any contract that is to be submitted to the
meeting for approval.
• The extent to which underwriting contracts have been carried out or not carried
out and the reasons for their not having been carried out
4) It should also contain a brief detail of the state of the company’s affairs and the business
plan since its incorporation, including any change that is affecting the interest of
shareholders or prospects of the company.
5) The statutory report shall, so far as it relates to the shares allotted by the company, the
cash received in respect of such shares and to the receipts and payments of the company,
be accompanied by a report of the auditors of the company as to the correctness of such
allotment, receipt of cash, receipts and payments.
6) The directors shall cause a copy of the statutory report and the auditor's report, if any, to
be delivered to the Registrar, after sending the report to the members of the company.
7) The directors shall cause the names, occupation, nationality and addresses of members
of the company, and their number of shares, to be produced at the commencement of the

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meeting and that should remain open and accessible to any member of the company
during the meeting.
8) The members present at the meeting shall be at liberty to discuss any matter relating to
the formation of the company.
9) The meeting may adjourn from time to time and at any adjourned meeting any resolution
of which notice has been given in accordance with the articles either before or
subsequently to the former meeting may be passed and the adjourned meeting shall have
the same powers as an original meeting.
10) This section shall not apply to public company who transferred itself into a private
company after one year of incorporation.
11) Any contravention or default in complying with requirement of this section shall be an
offence liable-
• in case of a listed company, to a penalty of level 2 on the standard scale; and
• in case of any other company, to a penalty of level 1 on the standard scale

ANNUAL GENERAL MEETING:

1) Every company shall hold an annual general meeting within sixteen months of its
incorporation and thereafter once in every calendar year within a period of four months
following the close of its financial year:
Provided that in case of listed company, the commission and in any other case, the
registrar may for any special reason extend the time within which any annual general
meeting, shall be held by a period not exceeding thirty days.
2) In case of a listed company, the annual general meeting will be held in the nearest town
or city where the registered office is located.
Provided that at least seven days prior to the date of meeting, on the demand of members
residing in a city who hold at least ten percent of the total paid up capital or such other
percentage as may be specified, a listed company must provide the facility of video- link
to such members enabling them to participate in its annual general meeting.
3) The notice of meeting shall be sent to commission, members and all others who are
entitled to receive notification within 21 days of the fixed date of meeting.

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Provided that in case of a listed company the notice should be published in English and
Urdu newspaper having nationwide circulation.
4) Nothing in this section shall apply for a single member company.
5) Any contravention or default in complying with requirement of this section shall be an
offence liable-
• In case of a listed company, to a penalty of level 2 on the standard scale; and
• In case of any other company, to a penalty of level 1 on the standard scale.

CALLING OF EXTRAORDINARY GENERAL MEETING:

1) All other meetings of the members of the company other than an annual general meeting
shall be called “extraordinary general meetings”.
2) The board may at any time call an extraordinary general meeting of the company to
consider any matter which requires the approval of the company in a general meeting.
3) The board shall, at the requisition made by the members-

(a) in case of a company having share capital, representing not less than one-tenth
of the total voting power as on the date of deposit of requisition; and

(b) in case of a company not having share capital, not less than one-tenth of the
total members;
4) The requisition shall state the objects of the meeting, be signed by the requisitions and
deposited at the registered office of the company.
5) If the board does not proceed within twenty-one days from the date of the requisition
being so deposited to cause a meeting to be called, the requisitions, may themselves call
the meeting, but in either case any meeting so called shall be held within three months
from the date of the deposit of the requisition.
6) Any meeting called under sub-section (5) by the requisitions shall be called in the same
manner, as nearly as possible, as that in which meetings are to be called by board.
7) Any reasonable expenses incurred by the requisitions in calling a meeting under sub-
section (5) shall be reimbursed to the requisitions by the company and the sums so paid
shall be deducted from any fee or other remuneration payable to such of the directors
who were in default in calling the meeting.

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8) Notice of an extraordinary general meeting shall be served to the members in the manner
provided for in section 55: Provided that in case of a company other than listed, if all the
members entitled to attend and vote at any extraordinary general meeting so agree, a
meeting may be held at a shorter notice
9) Any contravention or default in complying with requirement of this section shall be
an offence liable-
(a) In case of a listed company, to a penalty of level 2 on the standard scale; and
(b) In case of any other company, to a penalty of level 1 on the standard scale

QUORUM
(1) The quorum of a general meeting shall be-
• In the case of a public listed company, not less than ten members present
personally, or through video-link who represent not less than twenty-five
percent of the total voting power.
• In the case of any other company having share capital, two members
present personally, or through video-link who represent not less than
twenty-five percent of the total voting power.
• In the case of a company not having share capital, as provided in the
articles:
Provided that, if within half an hour the quorum is not present at the time appointed
for the meeting, the meeting shall be dissolved. And it shall adjourn to same day in
the next week at the same time and place, if at the adjourned meeting a quorum is not
present within half an hour from the time appointed for the meeting, the members
present personally or through video-link being not less than two shall be a quorum.

(2) Any contravention or default in complying with requirement of this section shall
be an offence liable-
a) In case of a listed company, to a penalty of level 2 on the standard scale; and

b) In case of any other company, to a penalty of level 1 on the standard scale.

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POWER OF THE COURT TO DECLARE THE PROCEEDINGS OF A GENERAL

MEETING INVALID
The court may on the request by members having not less than 10 percent of the
voting powers in the company, can declare the proceedings of meeting as invalid by
reason of a material defect, negligence in the notice or irregularity in the proceedings
of the meeting, which prevent members from using their rights effectively, declare
such proceedings or part thereof invalid and direct holding of a fresh general meeting:
Provided that the request shall be made within thirty days of the impugned meeting.

MINUTES OF MEETING
RECORDS OF RESOLUTIONS AND MEETINGS

(1) Every company shall keep records of-

(a) copies of all resolutions of members passed at general meetings; and
(b) minutes of all proceedings of general meetings along with the names of
participants, to be entered in properly maintained books;

(2) Minutes recorded in accordance with sub-section (1), if purporting to be

authenticated by the chairman of the meeting or by the chairman of the next meeting,
shall be the evidence of the proceedings at the meeting.

(3) Until the contrary is proved, every general meeting of the company in respect of the
proceedings whereof minutes have been so made shall be deemed to have been duly
called, held and conducted.

(4) The records must be kept at the registered office of the company from the date of the
resolution, meeting or decision simultaneously in physical and electronic form and it
shall be preserved for at least twenty years in physical form and permanently in
electronic form.

(5) Any default in complying with requirement of this section shall be an offence liable
to a penalty of level 1 on the standard scale.

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INSPECTION OF RECORDS OF RESOLUTIONS AND MEETINGS

1) The books containing the minutes of proceedings of the general meetings shall be
open to inspection by members without charge during business hours, subject to
such reasonable restrictions as the company may by its articles or in general meeting
impose so that not less than two hours in each day be allowed for inspection.
2) Any member shall at any time after seven days from the meeting be entitled to be
furnished, within seven days after he has made a request in that behalf to the
company, with a certified copy of the minutes of any general meeting at such charge
not exceeding the amount as may be fixed by the company.
3) If any inspection required under sub-section (1) is refused, or if any copy required
under sub-section (2) is not furnished within the time specified therein, the person
guilty of an offence shall be liable to a penalty of level 1 on the standard scale, and
the registrar may direct immediate inspection or supply of copy, as the case may be.

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CONCLUSION

This report has been conducted by using the Company Law that is made by the
Governing body of Pakistan under Act 2017. This report is made to identify the basic
purpose of the formation of SECP. It also explains the responsibilities, functions and
working of SECP. SECP is an institution that is responsible for the formation, winding
up, dissolution etc., of a company, it also looks after the financial matters, economic
growth, success peace of the country.
This report explains the whole structure of the SECP that what is the process of formation
of any kind of company (PVT Ltd, Public Ltd, Single member company), the functions of
SECP, the introduction and location of SECP.
All the above information given in this report is written with the help of the Company
Law, not a single information is written or changes by the makers of this report and the
same information is available on internet as well.

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REFERENCES
https://www.secp.gov.pk/

http://www.na.gov.pk/uploads/documents/SEC-Dec26-1997.pdf

https://www.scribd.com/presentation/150491981/presentation-on-SECP

http://www.dostpakistan.pk/securities-and-exchange-commission-of-pakistan-secp/

December 17, 2018