ISLAMABAD: Amid security concerns — both on the international and domestic levels — over money laundering, the Securities and Exchange Commission of Pakistan (SECP) has, for the first time, framed a set of regulations for non-governmental organisations (NGOs) and international non-governmental organisations (INGOs).

According to the new regulations, both NGOs and INGOs cannot directly or indirectly participate in any political campaign for elective public office, or engage in activities akin to those of a political party. They are also barred from funding political parties, individuals or any other associations that may be set up for such purposes.

Although all NGOs are registered with the SECP under the Companies Ordinance 1984, there was no complete set of regulations to oversee their conduct. The new regulations have been formulated under the Companies Act 2017, and all NGOs registered with the Commission must abide by them.

Among other things, the regulations — which refer to NGOs as companies — outline the procedure concerning licence grants as well, which are issued for three years unless revoked earlier by the Commission.

The directors and the chief executive officer(s) shall be entitled only for the reimbursement of expenses incurred by them for attending meetings. Payment of remuneration and other benefits shall be allowed only to the chief executive officer(s) and directors who are non-members and are full time employees of the company.

The income and any profits of the company, will be applied solely towards the promotion of objects of the company and no portion of it shall be distributed, paid or transferred directly or indirectly by way of dividend, bonus or otherwise by way of profit to the members of the company or their close relatives. The company shall close its accounts on the 30th of June each year. The regulations highlight that the NGOs must make transactions — grants, contribution and donations — through proper banking channels but any amount less than Rs25,000 may be received in cash.

Published in Dawn, June 12th, 2018