Name : Shams Assignment No : 06 ID : fa18-beee-0040

Company is a business that is set up as a separate legal entity from its owners. The words
“Private Limited" or "Public Limited" are added at the end of the name. These are sometimes
known as limited liability companies (LLC) or corporations in other countries. The main
difference between LLC's abroad is that taxes are paid by the directors of the company
individually rather than by the company. In the limited liability company structure available in
Pakistan the company pays taxes first and then the directors pay taxes on their respective
individual incomes. There are members or shareholders who own the company. These
members elect a board of directors. Companies are also generally perceived to be more
authentic and trustworthy when compared to other business structures. Companies are
registered with the Securities & Exchange Commission of Pakistan (SECP).

The two types of Companies are :

1. Private Limited Company
2. Public Limited Company

Private Limited Company:

Private Limited Company is required to have minimum 2 members and 2 directors. It may start
its business immediately after its incorporation.Private company restricts the right to transfer
its share through Article of Association.It can also limit the number of its members to 50 and
prohibits any invitation to the public to subscribe for its share.

Type of Entity Minimum No. of Minimum Capital Standard Time of

Shareholders Requirement Incorporation

Private Limited 2 PKR 100,000 6 weeks

Company

Registration Process:
In Pakistan, Private limited companies register under companies ordinance 1984.The Step by
Step Procedure of Private Limited Liability Company is given below.

1) Approval of the Company’s Name:

The first step of new company registration in Pakistan is to choose a name. When you
choose the name for your company then keep it in your mind that you should not use the
inappropriate words. Any deceptive words or terms will be straightforwardly rejected by the
SECP at the first place. Before choosing the name of your company, make sure that it is not
identical with the existing companies’ name nor closely resembling. While selecting the
name of your company the applicants have to look into the prohibitions and restrictions of
SECP. It is mandatory to use a private word at the end of the company name.For example
Makki Private Limited.

2) Submission of Documents:
There are some documents which you must have if you want to register a company in Pakistan.
● Memorandum of Association explains your company relationship with the outside world
under which business sector your company e.g. Institution, Travel agency etc.
● Articles of Association is about the day-to-day proceedings within the company. It tells
about the role of the CEO and directors. In short, it tells about how the company will run.
● CNIC Copies of Directors, CEO, Nominee (for the single-member company) or copies of
passport in case of a foreigner.
● NOC or letter of intent/ license from concerned authorities if you want to register some
specialized business.
● In the case of foreign company incorporation, you need to provide more details such as
List and details of Directors. The company profile, detail of Directors and their
nationality. You need to provide Company charter’s certified copy. You need to provide
Memorandum of Association and Articles of Association as well.
● Authorization of Subscribers for filing of documents.
● Registration/Filing fee.
● The total company incorporation fee is 1800 Rs for online submission if the nominal
share capital is not more than Rs 100,000. For offline submission, the total company
incorporation fee is 3500 Rs.

3) Certificate of Incorporation:
After submitting the documents, the SECP evaluates them. They check their validity. A digital
signature is granted by the National Institutional Facilitation Technologies (NIFT) and can be
acquired through the SECP.
Also, After the certificate of incorporation is issued, you may be needing to provide a company
seal, which depends on the area/city in which you are going to start your business.

4)Deposit of Shares:
After the registration, shareholders must deposit their corresponding amount of shares to the
company’s bank account.
5) Register for Income, Sales and Professional Taxes:

To register a company in Pakistan, you must have a National Tax Number (NTN). You can apply
for a National Tax Number (NTN) at the Regional Tax Office (RTO) of the Federal Board of
Revenue (FBR).

The Federal Board of Revenue (FBR) handles all the tax-related matters in the country. The
required documents to apply for a National Tax Number (NTN) are the following:

● NTN form.
● Registration Proof.
● Memorandum and Articles of association.
● Bank account number.
● Copies of National Identity Cards of companies’ Directors.
● Evidence of business address.

6) REGISTER WITH ESSI AND EOBI:

Depending on the location of the business, the company will need to register with

● Punjab Employees Social Security Institutions (PESSI)

● Sindh Employees Social Security Institution (SESSI)
● Likewise (BESSI) or (KPKESSI) for Balochistan and Khyber Pakhtunkhwa
respectively.

Under the Employees Old Age Benefits Institution (EOBI), insured employees are entitled to a

pension, upon retirement, invalidity in the case of disability, old-age grant and survivor’s

pension.

7)REGISTER WITH THE LABOR DEPARTMENT OF THE DISTRICT:

To safeguard the labor standard of the workers, all company’s are required to registration with
the District Chief Inspector of the labor department in each district. For registration, employer
must submit the application form A accompanied with the relevant bank form.

Public Limited Company:

A company whose securities are traded on a stock exchange and can be bought and sold by
anyone.There are two types of Public Limited Company.

Listed Public Limited company means:

The company registered under companies ordinance 1984 as well as quoted in Stock Markets
and its shares trade in stock markets, anyone can become the directors of any company if,
he/she purchases majority of the shares and apply for directorship under the SECP laws.

Un-listed Public Limited company means:

The company registered under companies ordinance 1984 but not quoted in Stock Markets and
its shares doesn’t trade in stock markets.

Type of Entity Minimum No. of Minimum Capital Standard Time of

Shareholders Requirement Incorporation

Public Listed 3 200 million 6 weeks

Company (Listed)

Public Listed 3 PKR 100,000 6 weeks

Company (Unlisted)

Registration Process:
In Pakistan, Public limited companies register under companies ordinance 1984.The Step by
Step Procedure of Public Limited Liability Company is given below.

1) Approval of the Company’s Name:

The process of approval of the name is the same for both private and public companies except
it is not mandatory to use “Public Limited” at the end of the Company name . For Example
Unilever Limited.

2) Submission of Documents:

There are some documents which you must have if you want to register a company in Pakistan.
FORM 1: Declaration of compliance with the requirements of the Companies Ordinance, 1984

FORM 21: Notice of situation of registered office of the company

Form 27 – List of persons consenting to act as director

Form 28 – Consent of Directors

FORM 29: Particulars of Directors and Officers including the Chief Executive, Secretary etc.

1. Memorandum of Association
2. Articles of Association
3. Scanned version of CNICs of the Directors
4. Scanned Receipt of Bank Deposit (In case of Offline Payment)

Form 1, Form 21 & Form 29 are automatically generated from the details you enter in the Form
of Incorporation.

3) Certificate of Incorporation:
After submitting the documents, the SECP evaluates them. They check their validity. A digital
signature is granted by the National Institutional Facilitation Technologies (NIFT) and can be
acquired through the SECP.
Also, After the certificate of incorporation is issued, you may be needing to provide a company
seal, which depends on the area/city in which you are going to start your business.A Public
Limited company will wait for the certificate of commencement in order to start their business.

4) Issue of Prospectus:

After the receipt of certificate of incorporation the promoters issue prospectus of the company
with a copy of application form for share. Prospectus shows the rule regarding purchase and
sale of share and about the mode of payment . A copy of prospectus should be submitted to the
registrar When the minimum number of share has been subscribed and the qualifying shares of
the director have been paid the company will submit a declaration to the registrar.

5) Commencement Stage :

A public limited company has to receive the certificate of commencement before

starting the business . A company submits following documents to the registrar.
1. Prospectus.
2. Minimum subscription.
 3. Director Shares.
After verifying these documents the registrar issues a certificate of commencement and
they can start the business.

5) Register for Income, Sales and Professional Taxes:

To register a company in Pakistan, you must have a National Tax Number (NTN). You can apply
for a National Tax Number (NTN) at the Regional Tax Office (RTO) of the Federal Board of
Revenue (FBR).

The Federal Board of Revenue (FBR) handles all the tax-related matters in the country. The
required documents to apply for a National Tax Number (NTN) are the following:

● NTN form.
● Registration Proof.
● Memorandum and Articles of association.
● Bank account number.
● Copies of National Identity Cards of companies’ Directors.
● Evidence of business address.

6) REGISTER WITH ESSI AND EOBI:

Depending on the location of the business, the company will need to register with

● Punjab Employees Social Security Institutions (PESSI)

● Sindh Employees Social Security Institution (SESSI)
● Likewise (BESSI) or (KPKESSI) for Balochistan and Khyber Pakhtunkhwa
respectively.

Under the Employees Old Age Benefits Institution (EOBI), insured employees are entitled to a

pension, upon retirement, invalidity in the case of disability, old-age grant and survivor’s

pension.

7)REGISTER WITH THE LABOR DEPARTMENT OF THE DISTRICT:

To safeguard the labor standard of the workers, all company’s are required to registration with
the District Chief Inspector of the labor department in each district. For registration, employer
must submit the application form A accompanied with the relevant bank form.
Public Limited Company Registration Process in Pakistan:

After confirmation of official bank fee / Company registration fee, concerned CRO takes 3-4
weeks for completion of company registration process in Pakistan. If there is any discrepancy
arises, it may take more time.