SECP Notifies Amendments to NBFC Rules 2003

The Securities and Exchange Commission of Pakistan (SECP), with the approval of the federal government, has notified amendments to the Non-Banking Finance Companies (Establishment & Regulations) Rules, 2003. The amendments, which have been introduced after a comprehensive stakeholder consultation process, aim to revitalize growth in the non-banking finance sector and facilitate establishing a contemporary and conducive regulatory framework. Ease of doing business has been provided by eliminating redundancies and requirements such as submission of certified copies of the memorandum, articles of association, and certificate of incorporation, providing reasons for selecting the proposed place of business, statistical data, additional facts in support of the application, etc. Additionally, directors and chief executive officers are no longer required to submit affidavits with respect to the correctness of information and instead can only submit a declaration to this effect. Moreover, the term “investment company” has been deleted from the rules as the structure no longer exists. The SECP believes that introducing measures for ease of doing business and streamlining licensing requirements is critical to the long-term sustainability of the NBFC sector in Pakistan. The notification of amendments is available on the SECP’s website.