In Pakistan, an NGO stands for a Non-Governmental Organization. It is a non-profit organization that operates independently of the government and works towards addressing various social, cultural, economic, or environmental issues in the country. NGOs can be involved in various fields such as education, health, human rights, gender equality, poverty alleviation, environmental protection, and community development. They work towards creating awareness, providing services, and advocating for policies and initiatives to improve the quality of life for citizens. NGOs in Pakistan can be registered as Trusts, Societies, or Section 42 Companies under different legal frameworks governed by relevant laws and regulations.

To register a Non-Governmental Organization (NGO) in Pakistan, the following steps need to be followed:

 

Choosing the type of  NGO

 

The next step is to choose the type of organization you want to register. The most common types of organizations in Pakistan are:

Society:

A society is a non-profit organization that operates for the promotion of literary, scientific, or charitable purposes. A society can be registered under the Societies Registration Act, 1860.

Example: The Pakistan Red Crescent Society.

Trust:

A trust is a legal arrangement where a person or organization holds property for the benefit of others. A trust can be registered under the Trusts Act, 1882.

Example: The Edhi Foundation.

Example: The Shaukat Khanum Memorial Cancer Hospital and Research Centre.

Voluntary Social Welfare Agency (VSWA):

A VSWA is a non-profit organization that operates for social welfare purposes. A VSWA can be registered under the Voluntary Social Welfare Agencies (Registration and Control) Ordinance, 1961.

Example: The Akhuwat Foundation.

 

Choose a name for your NGO

Steps for checking name availability in Pakistan for a company:

• Visit the SECP eServices Portal The Securities and Exchange Commission of Pakistan (SECP) eServices portal can be accessed at https://eservices.secp.gov.pk/eServices/. This is the official portal for registering companies in Pakistan.
• Select Company Name Availability Search On the SECP eServices portal, click on the ‘Company Name Availability Search’ button. This will take you to the next screen.
• Enter Proposed Name of Company On the next screen, enter the proposed name of your company in the search bar. It is recommended to choose a unique and distinguishable name that is not already in use by another company.
• Click Search Once you have entered the proposed name of your company, click on the ‘Search’ button. This will initiate the search process to check the availability of the name.
• View Search Results After the search is completed, a list of results will be displayed on the screen. If the proposed name is available, it will be listed as ‘Available’ under the ‘Name Availability Status’ column. If the name is not available, the search results will display the reason for the name being unavailable.
• Reserve Company Name If the proposed name of your company is available, you can reserve it by clicking on the ‘Reserve Name’ button. This will initiate the process of reserving the name for your company for a period of 90 days.

Overall, checking the availability of a company name in Pakistan is a simple and straightforward process that can be completed online through the SECP eServices portal. It is important to choose a unique and distinguishable name that is not already in use by another company to avoid any legal issues in the future.

Draft a Memorandum of Association (MOA) and Articles of Association (AOA)

 

Memorandum of Association (MOA)

The MOA is a legal document that defines the company’s scope of activities and sets out the objectives for which the company has been formed. It is one of the most important documents that need to be drafted while incorporating a company in Pakistan. Here are the steps for drafting the MOA:

• Define the Name and Registered Office of the Company

The first step in drafting the MOA is to define the name and registered office of the company. The name should be unique and not already registered with the SECP. The registered office should be located within Pakistan.

• Define the Objectives of the Company

The second step is to define the objectives of the company. The objectives should be clear, concise and specific to avoid any ambiguity. The MOA should also specify the nature of the business activities that the company will undertake.

• Define the Share Capital and Liability of the Members

The third step is to define the share capital and liability of the members. This section should specify the number of shares issued, their value and the rights attached to them. It should also specify the liability of the members in case the company is wound up.

Articles of Association (AOA)

The AOA is a document that sets out the rules and regulations governing the internal management and administration of the company. It outlines the rights and duties of the directors, shareholders and other officers of the company. Here are the steps for drafting the AOA:

• Define the Shareholders’ Rights and Responsibilities

The first step in drafting the AOA is to define the shareholders’ rights and responsibilities. This section should specify the voting rights of the shareholders, the procedure for conducting meetings, the quorum required and the procedure for passing resolutions.

• Define the Directors’ Powers and Duties

The second step is to define the directors’ powers and duties. This section should specify the appointment and removal of directors, their powers and duties, the procedure for conducting board meetings and the quorum required.

• Define the Company’s Administrative and Financial Procedures

The third step is to define the company’s administrative and financial procedures. This section should specify the procedure for keeping accounts, preparing financial statements and conducting audits.

Overall, drafting the MOA and AOA is an important aspect of incorporating a company in Pakistan. It is recommended to seek the assistance of a lawyer or a professional consultant to ensure that the documents are drafted in accordance with the requirements of the SECP and are legally binding.

Obtain Domicile Certificate

A Domicile Certificate is a legal document issued by the government that certifies a person’s residence in a particular area. To get a Domicile Certificate for an NGO in Pakistan, the following steps can be taken:

1. Obtain a copy of the NGO’s registration certificate from the relevant government department.
2. Go to the local Tehsil Office or Union Council office where the NGO is registered.
3. Collect the Domicile Certificate application form from the office.
4. Fill out the application form with all the required information, including the NGO’s registration number, name, and address.
5. Attach a copy of the NGO’s registration certificate and a copy of the NGO’s bank statement or any other relevant financial documents.
6. Submit the application form to the designated officer at the Tehsil Office or Union Council office.
7. Pay the required fee for the Domicile Certificate.
8. The designated officer will review the application and documents, and if everything is in order, will issue the Domicile Certificate for the NGO.

It is important to note that the requirements and procedures for obtaining a Domicile Certificate for an NGO may vary depending on the location and relevant government department involved.

Obtain National Tax Number (NTN)

You will need to register your NGO with the Federal Board of Revenue (FBR) for tax purposes. Following is  a detailed overview of the procedure for registering with the tax authorities in Pakistan:

• Obtain National Tax Number (NTN) The first step in registering with the tax authorities is to obtain a National Tax Number (NTN) from the Federal Board of Revenue (FBR). You can obtain the NTN by submitting an application to the FBR online or through a designated branch of the National Bank of Pakistan.
• Register for Withholding Tax If your company is required to deduct withholding tax on payments made to suppliers, contractors or employees, you will need to register for withholding tax with the FBR. This can be done online through the FBR’s e-portal or through a designated branch of the National Bank of Pakistan.
• Register for Professional Tax If your company employs professionals such as doctors, lawyers or engineers, you will need to register for professional tax with the relevant authority. The registration process and requirements may vary depending on the profession and the location of your company.
• Register for Provincial Taxes If your company operates in a province that imposes its own taxes such as the Punjab Sales Tax on Services Act, 2012 or the Sindh Sales Tax on Services Act, 2011, you will need to register for these taxes separately. The registration process and requirements may vary depending on the specific tax and the location of your company.

File Tax Returns Once your company is registered with the tax authorities, you will need to file tax returns on a regular basis. The frequency and deadlines for filing tax returns will depend on the type of tax and the location of your company.

Open a Bank Account

Opening a bank account in Pakistan is a straightforward process. To open a bank account, you need to visit a bank branch with the required documents. The documents required for opening a bank account in Pakistan may vary depending on the type of account and the bank. However, generally, the following documents are required:

1. CNIC (Computerized National Identity Card) or passport for non-residents
2. Proof of residence, such as a utility bill or rental agreement
3. Two passport size photographs
4. Initial deposit amount (varies from bank to bank)

Once you have all the required documents, you can visit a bank branch to open an account. You will be required to fill out an account opening form and provide the necessary documents. After submitting the application, the bank will verify the provided information and may require additional documents if needed.

It is important to note that some banks may require you to maintain a minimum balance in your account to avoid fees. Therefore, it is essential to inquire about the bank’s policies and fees before opening an account. Additionally, you may also choose to open an account online or through mobile banking services, depending on the bank’s offerings.

Apply for registration

The final step is to register the organization with the SECP. The registration process may vary depending on the type of organization. The general steps for registration are as follows:

Online Application:

The online application process can be initiated through the SECP eServices portal. The applicant will be required to provide details such as the name of the organization, the type of organization, the registered office address, and the details of the governing body.

Submission of Documents:

Once the online application is submitted, the applicant will be required to submit the following documents to the SECP:

1. Memorandum and Articles of Association (MOA/AOA)
2. Form A (Declaration of compliance with the provisions of the Companies Act, 2017)
3. Form 21 (Notice of situation of registered office of the company)
4. Digital Signature of the applicant
5. National Tax Number (NTN)

Verification and Approval:

The SECP will verify the submitted documents and may request additional information or documents if required. Once the verification process is completed, the SECP will issue a Certificate of Incorporation.

 

Inspection and approval

The concerned department will conduct an inspection of the NGO’s premises and activities. If the NGO meets all the requirements, the department will issue a registration certificate.

In Pakistan, Non-Governmental Organizations (NGOs) are required to register with the government to carry out their activities legally. NGO registration in Pakistan is governed by the Societies Registration Act 1860, the Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961, and the Companies Act 2017. In this article, we will discuss the legal requirements for NGO registration in Pakistan in detail.

Registration Fee

 

Registration fee of Rs. 500/- should be deposited in National Bank of Pakistan (NBP) through a challan Form under the head of Account C-03818-Other receipt fee for Registration of Societies under Societies Registration Act, 1860 (138)

Legal Requirements

Societies Registration Act 1860:

Under the Societies Registration Act 1860, NGOs can be registered as societies. To register as a society, the following legal requirements must be fulfilled:

1. Minimum Seven Members: At least seven individuals are required to form a society. The individuals must be over the age of 18 and must not have been convicted of any criminal offence.
2. Memorandum of Association: The Memorandum of Association must be drafted, which outlines the objectives of the society and the rules and regulations under which it will operate.
3. Board of Governors: The society must have a board of governors that will oversee the affairs of the organization. The board must consist of a president, a secretary, and a treasurer. The board must also have a minimum of three members.
4. Registration with Registrar of Societies: The society must be registered with the Registrar of Societies in the province where it intends to operate.

For example, the Human Rights Society of Pakistan was registered under the Societies Registration Act 1860 in 2010. The society aims to promote and protect human rights in Pakistan.

 

Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961:

 

Under the Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961, NGOs can be registered as voluntary social welfare agencies (VSWAs). To register as a VSWA, the following legal requirements must be fulfilled:

1. Registration with Registrar of VSWAs: The NGO must be registered with the Registrar of VSWAs in the province where it intends to operate.
2. Memorandum of Association: The Memorandum of Association must be drafted, which outlines the objectives of the NGO and the rules and regulations under which it will operate.
3. Board of Governors: The NGO must have a board of governors that will oversee the affairs of the organization. The board must consist of a president, a secretary, and a treasurer. The board must also have a minimum of three members.
4. Submission of Annual Report: The NGO must submit an annual report to the Registrar of VSWAs detailing its activities during the year.

For example, the Edhi Foundation, one of the largest NGOs in Pakistan, is registered under the Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961. The foundation provides healthcare, education, and shelter to people in need.

 

Companies Act 2017:

 

Under the Companies Act 2017, NGOs can be registered as companies limited by guarantee. To register as a company limited by guarantee, the following legal requirements must be fulfilled:

1. Minimum Three Members: At least three individuals are required to form a company limited by guarantee. The individuals must be over the age of 18 and must not have been convicted of any criminal offence.
2. Memorandum of Association: The Memorandum of Association must be drafted, which outlines the objectives of the NGO and the rules and regulations under which it will operate.
3. Articles of Association: The Articles of Association must be drafted, which outlines the rules and regulations for the management of the company.
4. Board of Directors: The NGO must have a board of directors that will oversee the affairs of the organization. The board must consist of a chairman, a chief executive officer, and a minimum of two directors.
5. Registration with Securities and Exchange Commission

For example, the Lahore Bachao Tehreek (Save Lahore Movement) is a non-profit organization that is registered as a company limited by guarantee under the Companies Act 2017. The organization aims to preserve Lahore’s heritage and culture by raising awareness and advocating for the protection of historic buildings and sites.

 

In addition to these legal requirements, NGOs must also adhere to other legal and regulatory requirements in Pakistan. These include:

Taxation Laws:

 

NGOs are required to register with the Federal Board of Revenue (FBR) for taxation purposes. They must also file their tax returns annually.

 

Foreign Contributions Regulations Act 2018:

 

NGOs that receive foreign funding must comply with the Foreign Contributions Regulations Act 2018. The Act requires NGOs to register with the Economic Affairs Division (EAD) and to obtain prior approval from the EAD before receiving any foreign funding.

 

Anti-Money Laundering Laws:

 

NGOs are required to comply with Pakistan’s Anti-Money Laundering laws. They must implement measures to prevent money laundering and terrorism financing and must report any suspicious transactions to the authorities.

 

Data Protection Laws:

 

NGOs must comply with Pakistan’s data protection laws, which require them to protect the personal data of their employees, members, and beneficiaries.

 

In conclusion, NGOs in Pakistan must comply with various legal and regulatory requirements to operate legally. Depending on their structure and objectives, NGOs can register as societies, voluntary social welfare agencies, or companies limited by guarantee. In addition to these legal requirements, NGOs must also comply with taxation laws, foreign contributions regulations, anti-money laundering laws, and data protection laws. By fulfilling these legal requirements, NGOs can carry out their activities legally and contribute to the development of Pakistan.

Apply for tax exemption

Once your NGO is registered, you can apply for tax exemption status from the Federal Board of Revenue (FBR).

• Submit tax exemption application: Once the NGO has obtained an NTN, it can submit an application for tax exemption to the Commissioner of Income Tax or the Director of Income Tax Exemption. The application must include a cover letter, a copy of the NGO registration certificate, a copy of the NTN certificate, copies of the memorandum and articles of association, and a copy of the latest audit report.
• Await decision: The tax authorities will review the application and supporting documents and make a decision on whether to grant tax exemption. The decision will be communicated to the NGO in writing.

It should be noted that tax exemption is not automatically granted to NGOs and the decision is made on a case-by-case basis. The NGO must demonstrate that it meets the criteria for tax exemption under the Income Tax Ordinance, 2001, such as being established for charitable purposes and not for profit.

 

Note:

 

The necessary requirements for registering an NGO in Pakistan may vary depending on the province and the type of NGO. It is advisable to consult with a lawyer or an experienced consultant who can guide you through the registration process.