Islamabad, The Securities and Exchange Commission of Pakistan (SECP) has recently outlined the procedure for the payment of subscription money by subscribers as detailed in their undertakings within the memorandum of association against subscribed shares. This move is aimed at standardizing the process and ensuring transparency in the incorporation and functioning of companies under the jurisdiction of SECP.

According to Securities and Exchange Commission of Pakistan, the newly issued notification clarifies the time, manner, and conditions under which the subscription money must be paid. It stipulates that subscription money is to be paid in cash via banking channels, immediately following the company’s incorporation, and within a maximum period of thirty days from the date of incorporation.

The SECP’s notification, issued under Section 17 of the Companies Act, 2017, mandates that a company’s issuance of shares is dependent upon the receipt of the full subscription money from each subscriber. Should there be any discrepancies or issues in receiving the subscription money, companies are directed to follow the guidance provided by the Registrar.

Furthermore, any failure to comply with the terms of the Notification or instructions issued by the Registrar may result in sanctions or actions as deemed appropriate under the relevant provisions of the Companies Act, 2017.

This circular aims to safeguard the interests of stakeholders and streamline the operational aspects of company formations and capital subscriptions. The complete details of the notification can be accessed through the SECP’s official website.