ISLAMABAD – The Securities and Exchange Commission of Pakistan (SECP) has announced a proposed amendment to the Companies Act, 2017, aimed at introducing the concept of Waqf management companies. The proposed Section 42A will allow the SECP to license and regulate these companies, which will operate as not-for-profit entities focused on managing Waqf assets in accordance with Shariah principles.
This initiative marks the first formal step in Pakistan towards corporatizing the governance of Waqf, taking inspiration from global best practices in Islamic finance, fiduciary stewardship, and social impact investment. The framework will enable the creation of modern Waqf structures, such as cash Waqf and investment Waqf, which will generate earnings to support charitable purposes.
Additionally, the SECP plans to introduce Waqf-linked Sukuk and dedicated Waqf mutual funds, adding a new segment to Pakistan’s Islamic finance markets. These developments aim to mobilize capital for charitable and developmental objectives.
The proposed framework includes several safeguards, such as the immutability of Waqf objectives and the perpetual preservation of Waqf assets. These companies will also be required to comply with Shariah standards, maintain strong governance, and undergo regular Shariah compliance monitoring. Penalties for non-compliance with the framework will be imposed as per the law.
This move aligns with SECP’s broader vision to revive Islamic social finance institutions and provide structured governance for Waqf assets to benefit the public.
