ISLAMABAD: In an effort to prevent corporate disputes, the Securities and Exchange Commission of Pakistan (SECP) has decided to introduce a rule in which the share transfer return will be filed by a company with the registrar within 15 days from the date of such transfer.
At present, the company is required to file the return on an annual basis. This will help in timely detection of any disputes in share transfers and their resolution, according to a press release issued on Thursday.
This is one of the decisions that the SECP has made in the light of recommendations made by the committee that SECP Chairman Zafar Hijazi had constituted on June 12 to ascertain the causes of corporate disputes and make relevant recommendations.
Concerns over growing disputes between the shareholders and the management or within the management of a private limited company had prompted him to form the committee.
In case of transfer of shares to non-members, the person making the transfer will be obliged to make first offer to the existing shareholders. The company, in case of further allotment of shares, will be required to send an offer of new shares to the existing members at least 15 days before the last date of acceptance of that particular offer.
In case of disproportionate allotment, the registrar will examine the factual position from the members concerned before registering the return for allotment. Furthermore, the signature of the outgoing director, in addition to the CEO or secretary, has to be affixed on the return, notifying resignation of the director.
Alternatively, Form 29 should be supported by the resignation letter of the outgoing director along with a copy of the CNIC. In case it is not possible to obtain signatures, the returns are required to be supported by the resignation letter from the outgoing director. This will require amendments to the corporate legal framework, which would be done in due course.
Published in The Express Tribune, July 10th, 2015.
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