ISLAMABAD, Dec 1: The Securities and Exchange Commission of Pakistan on Thursday endorsed a proposal of the Federation of Pakistan Chambers of Commerce and Industry that members of each trade organization representing a particular trade sector must have at least 75 per cent of the registered business in that trade.

The proposal was endorsed at a meeting held between FPCCI President Chaudhry Muhammad Saeed and SECP Chairman Dr Tariq Hassan on the occasion of the former’s visit to the commission’s office here.

The meeting observed that trade organizations (TOs) had weak compliance in filing their statutory returns and the compliance rate was required to be improved.

Moreover, it was noted with concern that promoters of some associations, after obtaining licence from the ministry of commerce, did not take steps for incorporation of the association under the Companies Ordinance.

The meeting proposed the establishment of a trilateral task force of the SECP, the FPCCI and the ministry of commerce on “licensing and registration of TOs”, which would look into institutional and regulatory framework relating to trade organizations and suggest changes in them, prepare guidelines, devise ways and means for encouraging corporatization of members of TOs, suggest methodology for improving compliance with statutory provisions by TOs and make suggestions for applicability of the code of corporate governance proposed for TOs.

Zubair Ahmed Malik, vice-president of the FPCCI, was also present.

Matters relating to licensing, formation and incorporation of trade organizations and renewal of their membership were also discussed in the meeting.

Participants of the meeting were briefed on the regulatory framework for TOs enshrined under the Trade Organizations Ordinance, 1961 and Companies Ordinance, 1984 by the SECP. It was observed that 177 trade organizations, including 143 associations and 34 chambers, were registered with the SECP.

Dr Hassan stressed the need for achieving the objectives of corporatization of business entities, strengthening the representative organizations, enhancing compliance and ensuring good corporate governance in the corporate sector. He urged increased coordination between the SECP, the FPCCI and director TOs to share information and take steps for awareness of corporatization.

The FPCCI president appreciated the SECP’s efforts for corporatization and assured his full cooperation in this regard. He said the FPCCI was revamping the federation, creating research and development wing, investing in human resource development, carrying out sectoral studies and providing online connectivity to all its members.