Tax bar seeks SECP jurisdiction for company restructurings

KARACHI: The Pakistan Tax Bar Association (PTBA) has urged the Securities and Exchange Commission of Pakistan (SECP) to assume jurisdiction over company restructuring cases, currently handled by the courts.

In a letter to the SECP on Thursday, the PTBA referred to the meeting it had in February where it highlighted the complexities and delays associated with the current court process for schemes of arrangement, compromise, amalgamation, or reconstruction. These cases were filed in compliance with Sections 279-283 of the Companies Act, 2017.

The association proposed that the SECP be granted authority to approve such schemes, streamlining the process and facilitating businesses.

At present, other than small-sized companies and public-sector companies, all matters pertaining to schemes of arrangement, compromise, amalgamation, or reconstruction of public-interest companies and large- and medium-sized companies are dealt with pursuant to a petition filed before the company bench of the high court having jurisdiction under the Act. Small-sized and public-sector companies contact the SECP for such restructuring.

To facilitate the ease of doing business and adopt easy procedures for ensuring compliance and avoiding filing petitions to courts, every application should be filed with the SECP, per the PTBA.

It also added that all existing petitions currently pending in the high courts should also be transferred to the SECP.The PTBA said that previously the SECP had assured that the proposed suggestion would be amended in the upcoming budget summary. However, these changes have not yet been made.