How to register a foreign company in Pakistan

Pakistan is an emerging market offering significant opportunities to foreign investors in industries such as IT, manufacturing, energy, construction, and services. To tap into this potential, foreign companies often seek to establish a legal presence in Pakistan. This can be achieved by registering a branch office, liaison office, or fully-owned subsidiary. Each of these models has specific legal requirements, timeframes, and regulatory conditions.

This comprehensive guide outlines the step-by-step process, documentation, legal framework, and compliance obligations for registering a foreign company in Pakistan.

Types of Foreign Business Entities in Pakistan

Before initiating the registration, foreign companies must decide the type of legal presence they want to establish:

Branch Office

• Allows commercial operations and revenue generation

• Permitted to engage in business activities approved by the Board of Investment (BOI)

• Profits can be repatriated after tax compliance

Liaison Office

• Acts as a communication channel between the foreign head office and local entities

• Cannot generate revenue or sign contracts

• Used for promotion, coordination, and market research

Wholly-Owned Subsidiary

• A company incorporated in Pakistan but 100% owned by a foreign entity

• Operates as a Private Limited Company under local laws

• Can engage in all commercial activities permitted under the Companies Act, 2017

Each entity type is governed by specific legal frameworks and has varying levels of operational independence.

Regulatory Authorities Involved

Foreign company registration involves multiple government institutions:

• Board of Investment (BOI) – Approves foreign office establishment

• Securities and Exchange Commission of Pakistan (SECP) – Registers foreign companies under the Companies Act

• State Bank of Pakistan (SBP) – Manages capital remittance and profit repatriation

• Federal Board of Revenue (FBR) – Issues NTN and manages tax compliance

• Ministry of Interior (MOI) – Provides security clearance (in sensitive sectors)

Understanding the roles of these institutions is key to navigating the registration process effectively.

Step-by-Step Guide to Registering a Foreign Company

Step 1: Obtain BOI Approval

The first and most critical step is securing approval from the Board of Investment for opening a branch or liaison office.

1. Visit the BOI online portal: https://bportal.boi.gov.pk

2. Create an account and submit the online application

3. Upload required documents (detailed below)

4. Pay the applicable BOI processing fee

5. Wait for evaluation and approval (can take 4–6 weeks)

After successful review, BOI issues an approval letter valid for 3 to 5 years.

Step 2: Security Clearance

In certain industries or for companies from specific countries, the BOI may forward applications to the Ministry of Interior (MOI) for additional vetting.

• MOI reviews the company’s background, sector, and ownership

• Approval can take an additional 2 to 4 weeks

• Once cleared, the company proceeds with SECP registration

Step 3: Register with SECP

Once BOI approval is obtained, the company must register as a foreign company under Section 435 of the Companies Act, 2017.

1. Log in to SECP’s eServices portal

2. Submit Form 44 and supporting documents

3. Pay the statutory filing fee

4. Upload notarized and legalized foreign documents

5. Wait for SECP to verify and issue Certificate of Registration

This step typically takes 5 to 10 working days if documentation is complete.

Step 4: Obtain NTN from FBR

After SECP registration, the company must obtain a National Tax Number (NTN):

1. Register through the FBR IRIS portal

2. Submit the SECP certificate, BOI letter, and office lease agreement

3. Receive the NTN confirmation for taxation purposes

This enables the foreign company to file tax returns and comply with local tax laws.

Step 5: Open a Local Bank Account

Foreign companies need a local corporate bank account in Pakistan for:

• Receiving capital remittance

• Paying operational expenses

• Managing local transactions

Requirements include:

• SECP Certificate

• BOI Approval Letter

• NTN

• Board resolution from parent company authorizing account opening

Banks may request physical presence of directors or authorized signatories.

Step 6: Capital Remittance and SBP Compliance

For branch and liaison offices:

• Foreign capital must be remitted from the parent company

• Funds should be deposited in a foreign currency account

• The bank files a Report to SBP confirming capital inflow

For subsidiaries:

• Share capital is remitted to the newly formed local company

• Recorded as equity in financial statements

SBP’s compliance is essential for future profit repatriation.

Step 7: Lease Office and Commence Operations

To start business operations:

• Secure a physical office space in Pakistan

• Install signage (mandatory for compliance)

• Recruit staff as per labor laws

• Maintain proper books of accounts

BOI requires annual reporting of foreign offices’ activities.

Documents Required for Registration

For BOI Approval

• Application form (online)

• Profile of the foreign company

• Business plan and proposed activities

• Board resolution authorizing setup

• Copy of parent company’s incorporation certificate

• Audited financial statements of the parent

• Passport copies of directors

• Lease agreement or office location details

All foreign-origin documents must be:

• Notarized in home country

• Attested by Pakistani Embassy

• Translated into English (if not already)

For SECP Registration (Form 44)

• Certified charter/memorandum of the foreign company

• Company’s latest financial statements

• List of directors and principal officers

• Address of principal place of business in Pakistan

• Consent of local representative

• Authorization letter to accept legal notices in Pakistan

• Payment of SECP fee

All documents must be uploaded to SECP eServices portal in prescribed format.

Timeline for Registration

Delays may occur due to incomplete documentation or sector-specific restrictions.

Costs Involved

• BOI Application Fee – USD 300 to 1000 (depends on activity)

• SECP Registration Fee – PKR 25,000 to 50,000 (approx.)

• Translation & Legalization Costs – Variable depending on country

• Professional Services Fee – Charged by consultants like Sterling.pk

Other costs include stamp paper, bank fees, office lease, and employee salaries.

Post-Registration Compliance

After successful registration, foreign companies must maintain ongoing compliance:

• File annual activity report with BOI

• Submit annual accounts and Form 45 to SECP

• Maintain audited financial statements

• File tax returns with FBR

• Report to SBP for any capital repatriation

Non-compliance may result in fines or cancellation of BOI/SECP registration.

Restrictions on Foreign Companies

• Cannot engage in retail trade, real estate development, or security services without specific permission

• Liaison offices are not allowed to earn revenue

• Must report any changes in company structure to BOI and SECP

• Cannot operate without an approved physical presence

• Hiring foreign employees may require work visa and clearance

Advantages of Registering a Foreign Company in Pakistan

• Access to a population of over 240 million consumers

• 100% foreign ownership permitted in most sectors

• Repatriation of capital and profits allowed

• Tax exemptions in IT, Special Economic Zones (SEZs), and Export Processing Zones (EPZs)

• Competitive labor costs and strategic location

Role of Sterling.pk in Foreign Company Registration

At Sterling.pk, we assist international clients with:

• Business structure advisory (branch, liaison, or subsidiary)

• BOI application preparation and submission

• Legalization and translation of foreign documents

• Complete SECP and FBR filings

• Bank account setup and SBP reporting

• Visa and labor law compliance for expatriate staff

• Post-registration support and compliance management

Our firm ensures a seamless setup process, minimizing delays and ensuring full legal compliance.

Conclusion

Registering a foreign company in Pakistan is a multistep legal process involving various authorities such as BOI, SECP, FBR, and SBP. Depending on your business objectives, you can choose between establishing a branch office, liaison office, or a fully owned subsidiary. While the process may take 6 to 10 weeks, proper planning, documentation, and professional guidance can streamline the journey.

With the support of Sterling.pk, foreign investors can navigate regulatory hurdles efficiently and start operations in one of South Asia’s most promising markets with full confidence.