Introduction
In an increasingly regulated global economy, transparency of ownership is key to combatting money laundering, terrorism financing, tax evasion, and corruption. In this context, the concept of the Ultimate Beneficial Owner (UBO) has become central to corporate compliance worldwide—including in Pakistan.
Pakistan has introduced UBO regulations under the Companies Act, 2017, enforced by the Securities and Exchange Commission of Pakistan (SECP), aligning with international standards set by the Financial Action Task Force (FATF). All companies registered with SECP are now required to maintain records of their beneficial owners and report this information periodically.
This detailed guide explains UBO compliance in Pakistan, who qualifies as a UBO, legal obligations, forms and deadlines, penalties for non-compliance, and how to ensure your company meets the SECP’s UBO requirements.
1. What is a UBO?
The Ultimate Beneficial Owner (UBO) is the natural person who ultimately owns, controls, or benefits from a legal entity, even if their name does not appear in the company’s official ownership documents.
According to SECP, a UBO is:
“An individual who ultimately owns or controls a company, directly or indirectly, through at least 25% of shares, voting rights, or control over management.”
2. Legal Framework for UBO Compliance
UBO reporting in Pakistan is governed by:
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Section 123A of the Companies Act, 2017
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Section 453 of the Companies Act, 2017
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SECP Circular No. 4 of 2021
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SECP S.R.O. 1019(I)/2020
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Anti-Money Laundering Act, 2010 (as amended)
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FATF Recommendations and G20 Beneficial Ownership Principles
These regulations apply to all companies registered with SECP, regardless of size or type.
3. Why UBO Compliance Matters
✅ Enhances transparency of corporate ownership
✅ Helps Pakistan meet FATF requirements and avoid blacklisting
✅ Prevents abuse of legal entities for illicit purposes
✅ Strengthens regulatory oversight by SECP, FBR, and AML units
✅ Boosts investor and public trust in the company
Failure to maintain and submit UBO information can result in serious penalties and legal consequences.
4. Who Must Comply with UBO Requirements?
| Entity Type | UBO Reporting Required? |
|---|---|
| Private Limited Company | ✅ Yes |
| Public Limited Company | ✅ Yes |
| Single Member Company (SMC) | ✅ Yes |
| Section 42 Company (Non-Profit) | ✅ Yes |
| Partnership / AOP / Sole Proprietor | ❌ No (Not under SECP) |
Note: Listed companies must still maintain a record of individuals who hold 25% or more of their shares or voting rights.
5. Threshold for Identifying a UBO
An individual is considered a UBO if they:
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Directly or indirectly hold 25% or more shares
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Hold 25% or more voting rights
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Have significant influence or control over board decisions
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Are a beneficiary of a trust that holds shares
Indirect control may involve complex shareholding chains, nominee arrangements, or control via agreements.
6. Step-by-Step UBO Compliance Process
Step 1: Identify Ultimate Beneficial Owners
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Review shareholding structure
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Trace shareholding chain to natural persons
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Identify individuals who meet the 25% threshold or exercise effective control
Step 2: Maintain Internal UBO Register
Maintain an up-to-date Register of Ultimate Beneficial Owners containing:
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Full name
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CNIC/NICOP/passport number
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Nationality
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Residential address
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Shareholding percentage
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Mode of ownership/control
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Date of becoming UBO
Step 3: File UBO Information with SECP
Submit required UBO information to SECP via Form 45 using the SECP eServices portal.
Step 4: Keep UBO Information Updated
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Any change in UBOs must be reported to SECP within 15 days
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Update internal records and notify board or compliance officer
7. How to File Form 45 (UBO Declaration)
Step-by-Step Filing Guide:
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Login to SECP eServices: https://eservices.secp.gov.pk
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Select “Statutory Filing” → “Form 45 – UBO Declaration”
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Enter company details and CUIN
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Add UBOs with:
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Full legal name
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CNIC or passport number
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Country of residence
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Nature and percentage of ownership/control
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Attach supporting documents (e.g., share certificates, agreements)
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Digitally sign and submit online
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Pay the prescribed filing fee (currently waived for most filings)
8. Required Documents for UBO Filing
| Document | Purpose |
|---|---|
| CNIC/NICOP/Passport copy of UBO | ID verification |
| Shareholding documents | Proof of ownership |
| Board resolution (optional) | For approving submission |
| Power of attorney (if filed by consultant) | Authorization |
| Trust deed (if shares held via trust) | Beneficial ownership disclosure |
9. Frequency and Deadline for UBO Filing
| Trigger Event | Filing Timeline |
|---|---|
| First UBO filing (initial compliance) | Within prescribed SECP deadline (now enforced year-round) |
| Change in UBO or shareholding | Within 15 days of change |
| Annual confirmation (optional for private companies) | With annual return (Form A) filing |
10. How to Maintain a UBO Register Internally
Your UBO register should be:
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Maintained at the registered office
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Accessible to SECP and law enforcement
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Updated whenever ownership or control changes
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Signed by a company officer or secretary and stored securely
A sample register format includes:
| Sr. | UBO Name | CNIC | Nationality | % Ownership | Control Basis | Date Added |
|---|
11. UBO Compliance for Companies with Complex Structures
For companies with multiple layers of shareholding or foreign parent companies, take the following steps:
✅ Trace ownership up to the natural person
✅ Use board resolutions, agreements, or legal records
✅ Identify any trusts, nominees, or power holders
✅ Disclose all indirect ownership paths
If necessary, hire a compliance consultant or legal advisor to navigate complex UBO structures.
12. Consequences of Non-Compliance
Failure to comply with UBO obligations can result in:
| Non-Compliance | Penalty/Fine |
|---|---|
| Not maintaining UBO records | Up to Rs. 1 million |
| Late or incorrect Form 45 submission | Daily penalty or show-cause notice |
| Providing false or misleading UBO info | Fine + criminal liability under Companies Act |
| Obstruction of SECP inspection | Additional fines and company deregistration |
In serious cases, directors may be disqualified or companies struck off.
13. UBO Compliance for Section 42 Companies
Even though non-profit companies are not profit-oriented, they must:
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Maintain UBO records
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Declare key controllers, including trustees or patrons
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Disclose foreign affiliations or donations
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Submit Form 45 and update changes within 15 days
14. Frequently Asked Questions (FAQs)
Q1: Is UBO filing required for every company?
Yes, all companies incorporated under the Companies Act must comply.
Q2: What if no one owns 25% or more?
Then declare the individual(s) with effective control or highest influence (e.g., CEO, chairperson).
Q3: What if my UBO is a foreign national?
Foreign nationals must still be disclosed with valid passport/ID documents.
Q4: Do single-member companies need to file UBO?
Yes. The single shareholder must be declared as the UBO.
Q5: What if the UBO changes?
Form 45 must be re-submitted within 15 days of any change.
15. How Sterling.pk Can Help
At Sterling.pk, we ensure your business remains fully UBO-compliant by offering:
✅ Identification and verification of UBOs
✅ Preparation and filing of Form 45
✅ Drafting of internal UBO registers
✅ Legal review of complex ownership structures
✅ Regular updates on SECP circulars and changes
✅ Advisory for Section 42 and foreign-controlled entities
Let our experts handle your regulatory risk so you can focus on growing your business.
Conclusion
UBO compliance is no longer optional—it’s a mandatory obligation under Pakistan’s corporate and anti-money laundering framework. Companies must take proactive steps to identify, maintain, and report their beneficial owners, keeping their records transparent and up-to-date with SECP.
Failing to meet UBO requirements can result in heavy penalties and legal trouble. With the guidance of professionals like Sterling.pk, your company can ensure full compliance, avoid regulatory scrutiny, and uphold the highest standards of corporate governance.
