SECP
(A regulatory body administering Corporate Laws in the country)
INTRODUCTION OF ORGANIZATION:
Established under the Securities and Exchange Commission of Pakistan Act 1997
Pakistan.
DEFINITION:
“The Securities and Exchange Commission of Pakistan (SECP) is a government
agency whose purpose is to develop a modern and efficient corporate sector and
a capital market based on sound regulatory principles, in order to foster
economic growth and prosperity in Pakistan.”
ESTABLISHMENT OF SECP:
The Securities and Exchange Commission of Pakistan (SECP) was set up in pursuance of
the Securities and Exchange Commission of Pakistan Act-1997, which defines the scope
of responsibilities and activities of the Securities and Exchange Commission of Pakistan.
The SECP became operational in January 1ST, 1999 and has come a long way since then.
It was initially concerned with the regulation of corporate sector and capital market with
the assistance of the Asian Development Bank (ADB).
Now The SECP is entrusted with a wide range of supervisory responsibilities, including
the corporate sector, public companies, stock exchanges, clearing companies and
securities depositories, as well as the insurance sector, non-banking finance companies,
private pension funds and housing finance.
HEAD OFFICE: Islamabad
REGIONAL OFFICES (COMPANY REGISTRATION OFFICES)
Islamabad, Multan, Faisalabad, Sukkur, Karachi, Lahore, Peshawar, Quetta.
REGULATION:
Corporate Sector
Capital market
Insurance
Non-banking sector
Pension and professional services.
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SECP
VISION:
“The development of modern and efficient corporate sector and capital market, based
on sound regulatory principles, that provide impetus for high economic growth and
foster social harmony in the Country.”
MISSION:
“To develop a fair, efficient and transparent regulatory framework, based on
international legal standards and best practices, for the protection of investors and
mitigation of systemic risk aimed at fostering growth of a robust corporate sector and
broad based capital market in Pakistan.”
STRATEGY:
“To develop an efficient and dynamic regulatory body that fosters principles of good
governance in the corporate sector, ensures proper risk management procedures in
the capital market, and protects investors through responsive policy measures and
effective enforcement practices.”
SCOPE:
The scope of the authority of the Commission has been extensively widened since its
creation. The insurance sector, non-banking financial companies, corporate sector and
pension funds have been added to the purview of the Commission.
Now the Commission's mandate includes non-banking financial institution, investment
financial services, modarbas, leasing companies, housing finance services, venture
capital investment, discounting services, investment advisory services, real estate
investment trust and asset management services, etc. The Commission also regulates
various external service providers that are linked to the corporate sector, like chartered
accountants, rating agencies, and corporate secretaries and other international
organization.
SERVICES:
These are the services of SECP that; through law and policies the company runs in an
organize way by issuing circular and notifications to registered companies and monitors
the listed companies to which they give facilities and check the proper flow of capital.
Those companies which not follow the rules they enforce them through orders. SECP
also winding up the cases of the listed companies in its organization and protect the
investors and creditors by providing guide series, public warnings, and also fights
against frauds.
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SECP
FUNCTIONS OF SECP:
The Commission is responsible for regulating the securities and any businesses in
stock exchange or in other security markets.
Supervising and monitoring the activities of any central depository and stock
exchange clearing house.
Registering and regulating the working of stock brokers, share transfer agents,
portfolio managers, investment advisors or anyone associated with security
markets.
Registering and regulating the investment schemes.
Regulation of securities market, credit rating companies and related institution.
Promoting investors education and intermediary training.
Conducting audit of Stock Exchanges and other intermediary organization.
Encouraging the development of capital market and corporate sector in Pakistan.
Acquisition of shares and the merger and takeover of companies, Suggesting
reforms in the rules and regulation of companies
Administration of company law.
Incorporation of new companies and their regulation.
Regulation of insurance sector and administration of insurance law.
Regulation of non banking finance companies such as leasing companies, mutual
funds, investment banks etc.
Regulation of pension funds and administration of voluntary pension system
rules.
Encourage of foreign investment
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SECP
DIVISIONS OF SECP & THEIR FUNCTIONS:
Company Law Division
It is assigned with a wide range of responsibilities that include regulation, monitoring
and enforcement of laws related to the corporate sector.
The Division is divided into following two Departments: Registration and Enforcement
and Monitoring department.
Securities Market Division
It is responsible for the regulation of all aspects of the securities market including
licensing, regulation of secondary market, public offerings and related Institutions like
Credit Rating Companies.
Specialized Companies Division
Regulation of Non-Banking Finance Companies (NBFC’s) like leasing companies,
investment banks, investment companies, mutual funds, housing finance companies,
venture capital companies & discount houses & regulation of Insurance business.
The Insurance Division
It is responsible for regulation and improvement of insurance sector, including life and
non-life insurance companies.
Support Services Division
Administration
The Law Division
The Law Division makes sure that all legal services are performed with honesty and in
accordance with fair values of the legal work for achieving the legal command of SECP.
It ensures risk management affairs of SECP. The Law Division comprises of three wings;
Advisory Wing: It provides fair legal advice to the operational divisions and
departments of the SECP and also Federal Government in corporate and financial
matters and is also responsible for inspection of the orders, notifications, circulars,
notices, contracts, and working papers.
Litigation Wing: It manages legal action for and on behalf of SECP and is assisted by
the operational division and department of the SECP to which the matter relates.
Legislation Wing: It manages up to 46 primary and secondary laws of SECP. It also
has command to make changes for legislation of federal government and SECP.
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