Amendments in the Associations with Charitable and Not for Profit Objects Regulations, 2018
Reform ID F156
Reform Description Before: Several redundant reforms with respect to the charitable and not for profit organizations required and the amendments in the association with charitable and not for profit objects regulations, 2018 were to be made to facilitate the businesses.

After:  Consequently, effective measures were taken to improve the ease of doing business for the specific classification and amendments in the subject regulations were made.
Sector All Sectors
Beneficiaries All companies registered with the SECP
Jurisdiction/ Location Federal (Entire Pakistan)
Department Securities and Exchange Commission of Pakistan
Date of Implementation 29.11.2021
Details Difficulty (a)        The license u/s 42 of the Companies Act, 2017 was issued for a period of three (3) years which was renewable for another term of three years (regulation 5(3) of the Regulations).

(b)        Commission’s approval was required for any change in the memorandum of association of associations licensed u/s 42 of the Companies Act, 2017 (regulation 7(ix) of the Regulations).

(c)        Commission’s approval was required for subscriber members to quit as members of the association (regulation 7(xiv) of the Regulations).

(d)        Commission’s approval was required for appointment of directors and chief executive officers of the associations who meet the fit and proper criteria as specified under these regulations (regulations 7(xvi) of the regulations).

(e)        Commission’s approval was required for making investment in associated companies by associations (regulation 7(xvii) of the Regulations).

(f)         Association was required to renew its license granted u/s 42 of the Companies Act, 2017 after every three years (regulation 8 & 9 of the Regulations).
Analysis Reform modernisation specially regarding Charitable and Not for profit were thought to be necessary for the ease of doing business and it was realized in the consultation with the private sector that to facilitate the welfare businesses and occupation the reforms should be introduced upfront.
Solution  (a)       Now there is no expiry for the license granted u/s 42 of the Companies Act, 2017 and such license shall be valid unless revoked as per law (regulation 5(3) of the regulations is omitted).

(b)        Commission’s approval is not required for alteration in memorandum & articles of association of associations licensed u/s 42 of the Companies Act, 2017 (regulation 7(ix) of the Regulations).

(c)        Commission’s approval is not required for subscriber members to quit as members of the association (regulation 7(xiv) of the Regulations).

(d)        Commission’s approval is not required for appointment of directors and chief executive officers of the associations who meet the fit and proper criteria as specified under these regulations (regulations 7(xvi) of the regulations).

(e)        Commission’s approval is not required for making investment in associated companies by associations (regulation 7(xvii) of the Regulations).

(f)         Requirement for renewal of license granted u/s 42 of the Companies Act, 2017 is abolished (regulation 8 & 9 of the Regulations).
Evidence
 Evidence

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