ISLAMABAD: Following its approval from the Senate on Monday, Companies Bill 2017 will be presented before the National Assembly.

The upper house of parliament has made 41 amendments to the bill.

The National Assembly first approved the bill, longest in the country’s history with 515 clauses and seven schedules spread over 346 pages, on February 6 and forwarded it to the Senate for approval.

The Senate Standing Committee on Finance commenced its review of the bill on Feb 17. It held 10 meetings and one public hearing at the Karachi Chamber of Commerce and Industry to review the proposed legislation.

Most of the 41 amendments made by the Senate’s body involve grammatical corrections and legal improvements in the language. It also introduced technical changes to Clause 180 that is related to the liabilities of directors and officers. It increased the responsibilities of the managers of a company.

The bill includes measures that promise ease in the incorporation of new companies and fewer filing requirements.

The proposed legislation gives companies with a paid-up capital of up to Rs3 million the option of not filing returns in the absence of any change in particulars.

The concept of inactive company has been introduced, which will provide owners with the flexibility to keep the entity alive with no compliance requirements during the inactive period.

Companies with a paid-up capital of up to Rs1m are not required to get their financial statements audited.

The draft bill became controversial after the government tried to implement it through an ordinance on November 12, 2016. However, a resolution signed and submitted by 47 senators on Nov 25, 2016 demanded that the upper house should strike down Companies Ordinance 2016. The ordinance was eventually disapproved on December 15, 2016.

After getting approval, Companies Bill 2017 will replace Companies Ordinance 1984, which was promulgated 33 years ago.

Apart from repealing Com­panies Ordinance 1984, the new bill will also withdraw numerous notifications, regulations and circulars issued by the Securities and Exchange Commission of Pakistan (SECP).

“Many provisions, such as e-filing, have been incorporated through circulars,” an official of the SECP said.

He added that the commission has already launched the exercise of identifying those circulars and notifications that will be withdrawn after Com­panies Bill 2017 is approved.

Published in Dawn, May 16th, 2017