SECP Proposes Ending Foreign Shareholding Disclosure Rule

Pakistan’s corporate watchdog, the Securities and Exchange Commission of Pakistan (SECP), has put forward a proposal to eliminate the mandatory disclosure of foreign shareholdings by shareholders and company executives by repealing Section 452 of the Companies Act, 2017.

At present, the law requires substantial shareholders and corporate officers to declare their ownership stakes in overseas entities to the regulator. According to the SECP, this obligation duplicates disclosure requirements already imposed by the Federal Board of Revenue (FBR) and other regulators under taxation and anti-money-laundering frameworks, leading to repetitive compliance for businesses.

To ease regulatory duplication and cut down compliance costs, the SECP has recommended that reporting of foreign assets and ownership interests be handled exclusively under prevailing tax and financial disclosure regimes, rather than through corporate legislation.

This proposed change forms part of the SECP’s wider initiative to revise corporate laws and simplify regulatory procedures for companies operating across Pakistan.