Types of companies in Pakistan and their registration process

Pakistan’s corporate sector is regulated by the Securities and Exchange Commission of Pakistan (SECP) under the Companies Act, 2017. Anyone seeking to start a formal business must first select the appropriate type of company and follow a structured registration process. This article offers a detailed overview of the different types of companies that can be registered in Pakistan, including their legal structure, suitability, compliance requirements, and the step-by-step process for registration through SECP.

1. Regulatory Authority for Company Registration in Pakistan

All companies in Pakistan are incorporated and regulated by:

• Securities and Exchange Commission of Pakistan (SECP)

• Registrar of Companies (Regional SECP Offices)

• Additionally, companies must register with:

  • Federal Board of Revenue (FBR) for tax

  • Provincial revenue authorities for sales tax or professional tax

  • Chambers of Commerce for trade-related businesses

The incorporation process is now fully digitized through SECP’s eServices Portal.

2. Types of Companies in Pakistan

Pakistan recognizes the following types of companies:

a. Single Member Company (SMC)
A private company with only one shareholder.

b. Private Limited Company (Pvt. Ltd.)
A company with at least 2 and up to 50 members, not offering shares to the public.

c. Public Limited Company
A company that may offer shares to the public:

• Unlisted Public Company – Not traded on stock exchange

• Listed Public Company – Traded on Pakistan Stock Exchange (PSX)

d. Foreign Company (Branch or Liaison Office)
A foreign firm operating in Pakistan with SECP approval.

e. Non-Profit Company (Section 42 Company)
A charitable, social, or educational organization without profit motives.

f. Limited Liability Partnership (LLP)
A hybrid between a company and a partnership under the LLP Act, 2017.

Each company type serves different purposes and caters to different business needs.

3. Single Member Company (SMC)

Definition:
An SMC is a private company that has only one shareholder and one director. Ideal for freelancers, consultants, or solo entrepreneurs who want limited liability and a formal company structure.

Key Features:

• One member and one nominee (mandatory)

• Limited liability protection

• Can be converted into Pvt Ltd if more shareholders are added

• Must file statutory returns with SECP

Registration Process:

1. Reserve company name on SECP eServices portal

2. Submit incorporation documents including:

   • Form-I (Compliance)

   • Form-21 (Registered office)

   • Form-29 (Director/nominee)

   • MOA and AOA

3. Upload CNIC/passport and nominee consent

4. Pay SECP registration fee

5. Certificate of Incorporation issued

4. Private Limited Company

Definition:
A company that restricts share transferability and cannot invite the public to subscribe to shares. Suitable for startups, family businesses, SMEs, and tech ventures.

Key Features:

• 2 to 50 shareholders

• Requires minimum 2 directors

• Separate legal entity from its owners

• Ideal for funding, taxation benefits, and credibility

Registration Process:

1. Name reservation via SECP

2. Draft MOA and AOA outlining business activities

3. Submit incorporation documents: Form-I, Form-21, Form-29

4. Upload ID documents of directors/shareholders

5. Pay fee (based on authorized capital)

6. Receive digital Certificate of Incorporation

Post-Registration:

• Apply for NTN with FBR

• Open corporate bank account

• Register with sales tax or PRA/SRB (if needed)

5. Public Limited Company

Definition:
A company that can offer its shares to the public and is usually used for large-scale operations. Can be either listed or unlisted.

Key Features:

• Minimum 3 directors and 7 shareholders

• Greater transparency and compliance

• May raise capital via public offerings (IPO)

• Subject to additional regulations by SECP and PSX

Registration Process:

1. Reserve name with SECP

2. Submit incorporation documents

3. Appoint legal advisors and auditors

4. Issue prospectus if raising public funds

5. Submit certificate of capital deposit to bank

6. Certificate of Incorporation is issued

Additional Requirements:

• Post-incorporation filing of Form 45 (prospectus)

• Registration with Pakistan Stock Exchange (for listed companies)

6. Foreign Company

Definition:
A company incorporated outside Pakistan but establishing a business place (branch, liaison office) in Pakistan.

Key Features:

• Cannot carry out retail or manufacturing without prior approval

• Requires permission from Board of Investment (BOI)

• Must appoint an authorized local agent

Registration Process:

1. Apply for permission from BOI (Branch or Liaison Office)

2. Submit documents to SECP including:

   • Certified copy of charter documents

   • Board Resolution

   • Power of Attorney in favor of local agent

   • Profile of parent company

3. Pay prescribed fee

4. Receive registration certificate from SECP

7. Non-Profit Organization (Section 42 Company)

Definition:
A company registered under Section 42 of the Companies Act, 2017 for promoting commerce, art, science, religion, charity, or other useful objectives.

Key Features:

• No dividend distribution allowed

• Requires license from SECP before incorporation

• Subject to annual audit and filing obligations

Registration Process:

1. Apply for license from SECP

2. Submit required documentation:

   • MOA and AOA

   • Details of proposed governing body

   • Source of funding

3. Once license is approved, proceed with company registration

4. Obtain tax exemption from FBR (if applicable)

8. Limited Liability Partnership (LLP)

Definition:
Introduced through LLP Act, 2017, LLPs combine benefits of both partnership and company.

Key Features:

• Minimum 2 partners

• Not a company, but a body corporate

• Limited liability for partners

• Flexible internal structure

Registration Process:

1. Apply on SECP’s LLP module

2. Submit:

   • LLP-1 (Incorporation form)

   • LLP-2 (Details of partners)

   • Agreement between partners

3. Upload CNICs/passports

4. Pay fee

5. Receive Certificate of LLP registration

9. Comparison Table of Company Types

10. Name Reservation Rules

Before registering any type of company, the name must be approved by SECP. The name:

• Must not be identical or closely resemble existing companies

• Must not include prohibited words (like “Federal”, “Bank”, “Authority”, etc.)

• Should reflect business nature (for certain sectors)

11. Digital Signature Requirement

SECP requires all directors and subscribers to obtain a Digital Signature Certificate (PKI Token) to authenticate the application.

Digital signatures can be obtained from:

• NIFT

• SECP Authorized Vendors

12. Post-Incorporation Requirements

After incorporation, the following must be completed:

• FBR NTN Registration

• Sales Tax Registration (if applicable)

• Chamber of Commerce registration (for exporters/importers)

• Opening of a business bank account

• Board Resolutions (first meeting, CEO appointment, bank authorization)

13. Timeline for Company Registration

Total time for full setup: 7–12 working days

14. Cost of Company Registration

Costs vary depending on:

• Type of company

• Authorized capital

• Professional fees

Basic SECP charges (2025):

• Rs. 1,500–5,000 for name reservation

• Rs. 1,500–25,000 for incorporation (based on capital)

• Additional costs for digital signatures, drafting, and tax registration

15. Why Choose the Right Structure?

Choosing the appropriate company type affects:

• Tax liability

• Investor appeal

• Legal protection

• Compliance obligations

• Business scalability

Sterling.pk offers advisory to help you make the right legal and tax-efficient decision before registration.

Conclusion

Pakistan’s corporate laws offer several types of company structures to suit every entrepreneur—from a solo freelancer to a multi-national enterprise. Each type comes with its own registration process, legal framework, and operational requirements. By understanding the features of SMC, Private Limited, Public Limited, LLPs, and NGOs, business owners can make informed decisions and comply effectively with SECP and FBR regulations.

At Sterling.pk, we guide you through the complete company registration process—name reservation, documentation, SECP filing, NTN issuance, and compliance advisory—ensuring a fast, reliable, and professional experience.