The Securities and Exchange Commission of Pakistan has introduced key amendments to the Companies (Further Issue of Shares) Regulations, 2020, focusing on the issuance of shares carrying different rights and privileges by listed companies. The changes aim to enhance minority shareholder protection, promote transparency, and strengthen corporate governance standards across Pakistan’s capital markets, according to an official press release.
Under the revised framework, ordinary shares carrying voting rights will now be entitled to the same percentage of dividends per share. In addition, the total voting power of all ordinary shares must constitute at least 75 percent of a company’s overall voting power, reinforcing the principle of one share, one vote.
The amendments also place limits on shares with varied voting rights. Such shares will be capped at a maximum of five votes per share, preventing excessive concentration of control. Furthermore, ordinary shares issued with differential rights must be listed securities, ensuring greater disclosure and regulatory oversight.
According to the SECP, these revisions are designed to better align economic benefits with voting power, reduce potential conflicts of interest, and prevent undue dominance by a small group of shareholders. The regulator emphasized that equitable governance and investor confidence remain central objectives of the updated regulations.
The amendments were finalized after extensive consultations with key stakeholders, including the Pakistan Stock Exchange, Central Depository Company, National Clearing Company of Pakistan Limited, listed companies, consultants, professional bodies, and law firms. Feedback from these consultations was carefully reviewed before the changes were notified.
The SECP stated that the updated regulations will help modernize Pakistan’s corporate framework while safeguarding investor interests and supporting the long-term development of the capital market.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.