The Securities and Exchange Commission of Pakistan (SECP) has approved a revised package of amendments to the Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980, and cleared it for submission to the Finance Division for further legislative action. The proposal refreshes reforms first introduced to the National Assembly in July 2020, which lapsed when the Assembly’s term ended in August 2023, and follows a new round of stakeholder engagement. The amendments would introduce unlisted Modarabas and strengthen investor protections by aligning governance provisions with the Companies Act, allowing special resolutions for management changes, and providing access to courts for winding-up proceedings. Regulatory and enforcement changes include expanding the Commission’s powers in disciplinary proceedings, converting certain criminal offences into civil matters, and dissolving the Modaraba Tribunal by shifting its functions to High Courts and session courts. The revised proposal is being forwarded to the federal government for consideration and enactment, in a context that the SECP links to efforts to modernise the legal framework for Islamic financial institutions and to the stated objective of eliminating Riba from the economy.
Securites & Exchange Commission of Pakistan 2025-02-28
Securities and Exchange Commission of Pakistan Policy Board approves revised amendments to the Modaraba Ordinance for submission to the federal government
The Securities and Exchange Commission of Pakistan has approved amendments to the Modaraba Companies and Modaraba Ordinance, 1980, for submission to the Finance Division. The revisions introduce unlisted Modarabas, enhance investor protections, and expand the Commission's disciplinary powers. This initiative aligns with efforts to modernize the legal framework for Islamic financial institutions and eliminate Riba from the economy.