2nd SME Conference (International) Selling your ideas is challenging. First, you must get your listeners to agree with you in principle. Then, you must move them to action. Use the Dale Carnegie Training® Evidence – Action – Benefit formula, and you will deliver a motivational, action-oriented presentation. Presentation by: Saboohi Israr Deputy Registrar of Companies Company Registration Office, Lahore

Securities & Exchange Commission of Pakistan (SECP) is the apex regulatory body in the country to regulate the corporate sector and the capital market with the aim to ensure transparency and efficiency in the functioning of its financial markets. One of the main functions of the SECP is to incorporate companies under the Companies Ordinance, 1984 (the Ordinance).

Securities and exchange commission of Pakistan DIVISIONS IN SECP COMPANY LAW DIVISION SECURITIES MARKET DIVISION SPECIALIZED COMPANIES DIVISION INSURANCE DIVISION SUPPORT SERVICES DIVISION

FUNCTION OF SECP Administration of company law. Incorporation of new companies and their Regulation. Regulation of securities market and related institutions Regulation of insurance sector and administration of insurance law. Regulation of non banking finance companies such as leasing companies, investment banks etc.

FACILITATION MEASURES E-enablement Measures Investor Facilitation Measures Legislative Measures Proposed measures to facilitate corporate sector/SMEs

E-enablement Measures Launch of eServices to enable online incorporation and post-incorporation services delivery. Introduction of a simple one-page JSP form to capture information at company incorporation stage electronically. Facility for online payment of fee through credit cards and online fund transfer at MCB and UBL Enabling electronic inspection of corporate records (inter-CRO) Setting up of help-line/service desk for the users of eServices Establishment of Facilitation Desk at regional offices

Investor Facilitation Measures Name search facility available through Commission’s website Model Memorandum and Article of Associations of more than 80 major business sectors placed on website, including one-pager MOA for designated sectors Guide Series on incorporation and post-incorporation requirements issued in different languages Introduction of Swift Company Registration Scheme Opening of facilitation centers in Sialkot and Abbottabad

Investor Facilitation Measures Issuance of a tri-fold incorporation brochure highlighting benefits of corporatization and the steps involved in company registration and ancillary activities Free of Cost Copies at the time of registration of company Reduction of company incorporation fee significantly i.e. up to 60%

Legislative Measures The draft Companies Bill, 2017. Issuance of Companies Easy Exit Regulations. Setting time limits on regulator’s case handling through Companies Registration Office Regulations, 2003 as amended from time to time.

Measures Introduced to Promote Small and Mid-sized NBFCs Promotion of small and mid-sized non deposit taking NBFCs Concept of small and mid-sized non-deposit taking lending NBFCs has been introduced by significantly reducing equity requirements to encourage small and mid-sized lending NBFCs Floatation and Management of Modarabas There are no restrictions for the small entrepreneurs to enter in SME sector through floatation and management of Modarabas. Under the Modaraba law, a company with the paid up capital of Rs. 2.5 million only can undertake the business of floatation and management of Modarabas.

Measures Introduced to Promote Small and Mid-sized NBFCs Reduced capital and fund size requirements for REITs. For supporting SME sector, the paid up capital requirement for REIT management company has been reduced from Rs. 200 million to Rs. 50 million and the fund size for REIT Scheme has been brought down from Rs. 2 billion to the listing requirement of the relevant stock exchange

Fund Raising from capital market- Framework for SMEs In year 2015, SECP in consultation with Pakistan Stock Exchange has prepared a regulatory framework called the “REGULATIONS GOVERNING LISTING AND TRADING OF EQUITY SECURITIES OF SMALL AND MEDIUM ENTERPRISES (SMEs) Eligibility Criteria: SME must be a public company, registered under the Companies Ordinance, 1984, having a post issue paid up capital of not less than Rs.25 million and not more than Rs.200 million. An SME may apply for listing provided it is authorized by its Memorandum and Articles of Association to do so and shall offer shares only to Qualified Institutional Buyers (QIBs) and High Net-Worth Individuals (HNWIs).

Fund Raising from capital market - Framework for SMEs Other Conditions: minimum offer size is 20% of the post issue paid-up capital of SME; offer of securities through circulation of Information Memorandum; Appointment of Market Advisor; Appointment of Market Maker for quoting two way quotes of SME; Number of initial subscribers is not less than five (05); Bid size for each initial subscriber is not less than rupees one million;

Fund Raising from capital market- Framework for SMEs Minimum order size for trading in equity securities of SME is Rs.100,000; Prohibition on short and blank sales; Sponsors shall retain their entire shareholding including subsequent right and bonus shares for a lock in period of at least I year Issuer must have its own website and disseminate the basic information about the SME, its business activities and audited financial statement

THANKS Saboohi.ashraf@secp.gov.pk