Govt poised to regulate offshore investments

ISLAMABAD: The government has stepped up to check corruption and regulate offshore investments in a bid to promote transparency and good governance, finance minister said on Tuesday.

“New measures, such as the companies’ global register of beneficial ownership, will curb corruption, help (government) address challenges related to offshore investments and ensure transparency in governance,” said finance minister Ishaq Dar, in a meeting with the officials of the Federal Board of Revenue and financial monitoring unit.

Dar said the government took a number of measures to counter money laundering. “The Companies Ordinance 2016 empowers the SECP (Securities and Exchange Commission of Pakistan) to conduct a joint investigation against fraud, money laundering and terrorist financing,” he added. “The Benami Law aims to curb the use of benami transactions for criminal proceeds and black money.”

The government last week promulgated the Companies Ordinance 2016 to replace the Companies Ordinance 1984. There was a need to revamp the 32-year old ordinance to provide an improved competitive legal framework for the corporate sector in Pakistan.

The ordinance emphasises maximum disclosures by Pakistanis to the local regulatory authorities in respect of investment in foreign companies. Under the new ordinance, the SECP will maintain Companies Global Register of Beneficial Ownership, which will have complete record of the beneficial ownership of the substantial shareholders and officers in local and foreign companies doing business in the country.

Moreover, it will be binding on the foreign company operating in Pakistan to provide complete information of its directors, officers and or beneficial owners. The minister said the government has also undertaken measures for valuation of property and related tax matters.

Minister Dar said Pakistan has become a signatory to the Organisation for Economic Cooperation and Development’s multilateral convention on mutual administrative assistance in tax matters. 

He urged the officials, present in the meeting, to ensure effective and expeditious implementation of these laws and measures to achieve the desired outcomes.

“Continued efforts should be made for further strengthening the regime and improvements should be suggested to plug any possible loopholes related to money laundering and terrorist financing,” he said.