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Private Limited Company Registration in Pakistan
Private limited Company means corporation or corporate body which is registered under companies Act 2017 for Doing any kind of business for example trading, services or manufacturing. Private limited companies are of two types (A) Limited by Shares: whose shareholders liability is limited to their investment or shares held .(B) Limited By Guarantee: in these types of companies shareholders liability is limited to the Guaranteed amount that shareholders agreed upon .
Separate legal identity
It is basic principal that The corporation is a Separate legal person from their shareholders or owners and has its own rights and duties .the only difference is that company is an artificial person whereas shareholders(individual) are natural persons. It can own assets or property in its name, takes loans, singed the contracts and the company is personally liable for all of its taxes payable .
Shareholders Limited Liability
The another most important feature of companies is that members liability to pay back the debts of the company is limited to the amount of any unpaid capital which they have agreed to pay at time of its incorporation. That means that company personally responsible for the payments all of its dues . for example if corporation has taken a loan of 500, 000 and one of its shareholder has own shares of worth 100, 000 from which amount of 50,000 is remains unpaid. Then the shareholder has no responsibility for payment of all debt of that company, he has to pay only unpaid amount of 50,000.
Lifting veil of incorporation
In some circumstances the shareholders or owners are personally responsible for debts or liabilities of the organization . For example if the companies has failed to pay taxes payable then under the income tax ordinance 2001 the all the directors are personally liable for payment of tax due by the company. Similarly if the directors of companies has given any personal guarantee in any contract or bank loan then the directors are personally liable.
Company Registration
Process of incorporation of a business is regulated by SECP . The application is required to file Memorandum and Articles of Association and other documents with the companies registrar(CRO) .
Company Registration Procedures
The step by step process is as follows.
Name Reservation
The first step with regard to Incorporation of companies is to reserve a unique Name for the company with the registrar(CRO). For this purpose, an application is to be made and fee for online application Rs.200/- and Rs.500/- for offline . if the name is available then SECP issue Name Reservation letter.
Note :It is mandatory to Proposed three options for name reservation in the order of priority. Preference will be given to 1st Proposal if available otherwise 2nd and third options.
Documents & Process Submission
The following documents are needed to be attached. Memorandum and Articles of Association(MOA) , In case of combined process (Name Reservation and registration) attachment of memorandum and articles of association is not required.
Attachment of scan copies of CNIC of directors/subscribers
Process Submission ( all subscribers are required to sign the process separately).
Security Services Company
If company objective is to provide the security services i.e. guard, the following additional requirements to be fulfilled.
Post Incorporation Requirements
Holding first AGM
Under Section 132(1) of the companies act 2017 all companies are legally required to hold, an annual general meeting(AGM) within sixteen months from the date of its Incorporation and after that once in every year within a period of one hundred and twenty (120) days After the end of its finical year i.e. if the company registered on 1st January 2020 then , First AGM required to held on or before 30 April 2021. The main purpose for holding AGM is to elect the directors, appointment of Auditors and Chief Executive and also report to the SECP through filing Form A.
Auditor Appointment
After the incorporation 1st Auditor is required to appoint with a period of 90 days through filing Form 29 with SECP. letter of consent is also required from the Auditor for this purpose.
Books of Accounts
All companies shall prepare and keep at its registered office books of account and other relevant books and financial statements for every financial year with following details
