ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has ordered a private company to hire a chief executive officer (CEO) by Aug 16, otherwise a penalty of Rs500,000 will be imposed on it for failing to abide by the directives.

The order was finalised by a two-member bench of the SECP — led by its executive director Imran Inayat Butt — after it was observed that the position was vacant at Orange REIT Management Company since April 6, 2016.

The order was signed by SECP Commissioner Zafar Abdullah.

The company is a non-banking finance company to carry out real estate management services.

The company had informed the SECP in March 2016 about the resignation of its CEO.

The SECP decision notes that the company has failed to appoint a CEO despite a lapse of one year. “As per the prevailing regulatory framework, the company is required to fill the position within 14 days from the date it fell vacant,” the SECP order said.

According to details, a show-cause notice was issued in May and the company was asked to explain why penal action may not be taken for the irregularities.

In response to the notice, company secretary Muhammad Aslam, along with a lawyer, appeared at the SECP and submitted that it was difficult to find a suitable person for the position.

The company is in the process to fill the vacant position and interviews are in process, Mr Aslam maintained.

The representatives of the company requested for a period of three months for the appointment of CEO. The SECP granted a period of two months.

“It is directed the company to fill the vacant position of CEO with a person fulfilling fit and proper criteria within two months from the date of this order,” SECP said in its order signed on June 16, 2016.

The SECP order also issued a warning: “It was necessary to mention that the licensed institutions are entities that have been granted permission for a specific form of business.

“This permission is subject to the premise that the institutions will undertake the licensed form of business in order to meet the objectives of sector growth, employment generation, higher economic activity and a viable business model for the investors.

“If an entity cannot undertake its licensed form of business then it should not be considered as a viable licensed institution.”

After the company fills the position of CEO within the given time period, it needs to obtain the necessary regulatory approvals from the SECP.

Published in Dawn, August 6th, 2017