Company Registration Process

How to Register a Company in Pakistan?

Company Registration Process can be overwhelming, but it’s an important step in starting your business. The first step is to choose a unique name and do a name search to ensure its availability. Once you have a name, choose a legal structure, such as a sole proprietorship, partnership or corporation.

What are the Benefits of Registering a Company in Pakistan?

When you start a business, it is initially either a sole proprietorship or a partnership. However, as your business expands and targets new regions, a stronger and more reliable business structure becomes essential. To project reliability, raise capital, and limit liability, consider registering your company in Pakistan. A corporate entity offers several advantages:

Limits Your Liability: Registering a company separates its assets and wealth from your personal assets, providing limited liability. In case of bankruptcy, your personal wealth remains protected.
Access Capital: Investors prefer businesses with legal registration, making it easier to raise capital. Legal recognition assures clients and investors of your business’s existence.
Credibility: A company registered with bodies like SECP in Pakistan is perceived as more credible than unregistered businesses. Compliance with tax regulations and annual document filings enhance credibility.
Exponential Growth: With credibility and access to capital, businesses can expand into new ventures, markets, and boost growth.

Moreover, company registration in Pakistan offers additional benefits such as tax rebates for specific industries like IT exports. The government supports genuine businesses contributing to the country’s economic growth. Registered companies can participate in national and international exhibitions to expand their reach globally.

What kind of company can we register in Pakistan?

Many individuals lack awareness about the various legal methods for registering a business, finding it challenging to distinguish between them. Before delving into the process of registering a business in Pakistan, it’s beneficial to understand the different types of companies available. This knowledge will help you select the option that aligns best with your business model.

Sr. #.	Kinds of Company	Required capital (minimum)	Required shareholders (minimum)	Time to incorporate
1	Single Member Company	Pkr. 150,000	1	2 weeks
2	Private Limited Company	Pkr. 180,000	2	3 weeks
3	Public Limited Company	Pkr. 250 million	7	5 weeks
4	Nonprofit organization	Pkr. 100,000	3	5 weeks

A Single Member Company (SMC):

When a company is established by a single member, it is referred to as a single-member company. In this setup, ownership is retained by one individual, and shares cannot be allocated to more than one member. This option is ideal for sole proprietors seeking to incorporate their businesses independently, without the need for partners, while still enjoying the advantages of operating as a corporate entity.

Private Limited Company:

A private limited company can be formed by two or more individuals who wish to formalize their business as a legal entity.

The formation of a private limited company in Pakistan is governed by the Companies Act, which outlines the necessary regulations.

This type of company grants autonomy in determining the number of members and imposes restrictions on share transfers.

According to regulations, a private limited company is prohibited from issuing shares or financial instruments to the general public.

Public Limited Company:

To establish a public limited company, a minimum of three members is needed. This type of company is distinct from a private limited company as it is created for the general public. Public limited companies can issue shares to the public through a stock exchange or through an Initial Public Offering (IPO). Banks or financial institutions typically oversee IPOs on behalf of companies. Due to potential public investment, a public limited company usually requires a significant amount of capital.

Non-Profit Organizations:

If you aim to participate in public welfare endeavors to bolster your reputation and credibility, establishing a Nonprofit Company is recommended. Per regulations, a Nonprofit company can solely be incorporated as a public company. A stipulated contribution to the company is mandatory. Furthermore, a commitment to addressing the company’s debts up to a specified limit upon liquidation is required. The company’s name may exclude the designations “Limited” or “Guarantee Limited”.

10 Steps to apply for company registration:

Choose a unique name for your company and get it approved by the registrar of companies in your country. This step is important because the name of your company will be its identity.
Decide on the type of company, you want to register. You can choose from various types of companies such as sole proprietorship, partnership, limited liability company, or corporation.
Obtain the necessary documents, and information required for registration. This may include your identification documents, proof of address, and business plan.
Fill out the application, form for company registration. This form will usually require you to provide information about the name of your company, its type, and the names of the directors and shareholders.
Pay the registration fees, The fees for company registration vary depending on the type of company and the country you are registering in.
Submit your application, form and all the necessary documents to the registrar of companies. This can be done online or in person.
Wait for your application, to be processed. The processing time varies depending on the country and type of company.
Once your application has been approved, you will receive a certificate of incorporation. This certificate confirms that your company has been legally registered.
Apply for any necessary licenses and permits. Depending on the type of business you are running, you may need additional licenses and permits to operate legally.
Start operating your business! Once you have completed all the necessary steps, you can start operating your company and start making a profit.

Documents required for the registration of a company:

The Memorandum and Articles of association is basic document that explain all the purposes of Company registration. In addition, the basic purpose of Company Registration Process is to engage in general contractors, trading companies, and other businesses. To complete the process of registering a Company in Pakistan, all businesses that the Company plans to do must be listed in a memorandum of understanding. Contains all the rules of the operating Company. How to manage directors, such as how a general meeting of a Company is held in the process of Company registration in Pakistan.

Form 1:

Form 1 for Company Registration Process is essentially a statement from one of the directors of the Company that is about to register. Form 1 can be downloaded from the Pakistan Securities and Exchange Commission website. This is another mandatory component of the Pakistan Company registration process.

Copies of the Computerized National Identity Card (CNIC) for all founding members.
Proof of the registered office address.
Memorandum of Association to specify the company type and members.
Articles of Association to outline the company’s purpose and activities.
Bank statement confirming the payment of required capital.
Details of directors and their nationality for foreign company registration.
Fee payment receipt.