Securities and Exchange Commission of Pakistan amends first schedule to Companies Ordinance 1984
Islamabad, March 13, 2013 (PPI-OT): The Securities and Exchange Commission of Pakistan (SECP) with the aim of facilitating corporate sector has made certain amendments to the First Schedule to the 1984 Companies Ordinance, containing articles of association of companies vide its SRO 194(I)/2013.
The amendments broadly relate to the areas of alternative dispute resolution (ADR) mechanism, dividend payments mode, holding of the meetings of the Board of Directors through tele/video conferencing, sending of notices through email, and procedure for election of directors for companies limited by guarantee and not having a share capital. In order to provide a tool for dispute resolution between the company or its shareholders or between the directors or the shareholders, new provisions have been added to Tables A and C.
The said provisions seek to encourage directors, shareholders and other stakeholders to solve their disputes without recourse to courts of law. Amendments have also been made to Table A of the First Schedule, enabling the companies to make payment of dividend in cash and/or in specie. Earlier, such facility was not clarified in the relevant provisions.
As per previous provisions, it was not necessary to give notice of directors’ meeting to any director who was out of country for the time being. Now, owing to the amendment to Tables A and C of the First Schedule, it has been made easier to send notice to directors, whether in the country or out of country, via email, which will be considered a valid notice.
Keeping in view the technological advances, new provisions in Tables A and C have been added to facilitate directors to hold meetings through tele/video conferencing in emergency situations, where it is not possible for them to be physically present at the venue of the meeting.
This provision shall increase directors’ participation in meetings. Lastly, to make provisions for holding of election in companies limited by guarantee and not having share capital, a new provision has been added to Table C, which mandates that the directors of the company shall be elected in accordance with the provisions of the ordinance.
The notification regarding the above amendments has been placed on the SECP’s website… The amended copies of the standard formats of the Articles of Association containing all such amendments shall be available on the website shortly.
The SECP has made a number of amendments to 1st schedule containing articles of association of companies.
2. The directors have been allowed to hold their meetings through tele/video conferencing.
3. The notice of directors meeting through email shall be a valid notice.
4. The companies have been asked to adopt alternative dispute resolution (ADR) mechanism before going to courts of law
For more information, contact:
Shakil Ahmad Chaudhary
Head, Internal and External Communication
Securities and Exchange Commission of Pakistan (SECP)
NIC Building, 63 Jinnah Avenue, Islamabad
Tel: +9251 921 4005 or 921 4009 (Ext. 378)
Fax: +9251 920 6459
Cell: +92302 855 2254