ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has introduced a draft Venture Capital (VC) Bill to the Board of Investment (BOI) for public consultation. The proposed legislation is designed to expand access to risk capital, attract both domestic and foreign investments, support the growth of startups, generate jobs, and contribute to the country’s economic development.

According to Securities and Exchange Commission of Pakistan, the Bill is a product of a Federal Government initiative, tasking the SECP with creating a standalone regulatory framework tailored for venture capital. The aim is to enhance funding opportunities for startups and high-growth businesses, addressing the current limitations faced by Pakistan’s startup, technology, and innovation sectors, which often rely on offshore investment structures.

The draft Bill proposes a straightforward and transparent framework for venture capital funds and fund managers. It includes provisions for light-touch licensing and registration, simple operational structures, and clear governance and reporting standards. The intent is to formalize venture capital activities within Pakistan, making them more accessible.

Dr. Kabir Ahmed Sidhu, Chairman of the SECP, emphasized that the proposed law aims to funnel private capital into Pakistan’s emerging business sectors. He noted that the Bill acknowledges the inherent risks and innovation-driven nature of venture capital, aiming to lower regulatory barriers while ensuring effective governance and investor protection.

The SECP and BOI plan to conduct public consultations with key stakeholders, including startups, fund managers, legal and financial experts, the State Bank of Pakistan, Pakistan Stock Exchange, and relevant industry associations, before the draft advances through the legislative process.