ISLAMABAD — The Securities and Exchange Commission of Pakistan (SECP) has issued a notification to begin public consultation on proposed amendments to the Companies (Further Issue of Shares) Regulations, 2020 (the ‘Regulations’).
The amendments aim to revise a provision that currently restricts listed companies from proceeding with a rights issue if their Credit Information Bureau (CIB) report shows any overdues or defaults. Under the Companies Act, 2017, companies can increase their share capital through a rights issue, allowing existing shareholders to subscribe to additional shares in proportion to their holdings.
The draft notification follows an evaluation of stakeholder feedback from an earlier consultation paper, which explored the potential risks and benefits of removing the CIB report requirement for listed companies undertaking rights issues. A majority of stakeholders expressed concern that the current requirement limits the ability of financially distressed companies to raise funds for revival, restructuring, or resumption of operations, even when existing shareholders are willing to support the company.
To address these concerns, the proposed amendments enhance disclosure obligations. Companies would be required to disclose any current or past overdues or defaults, including those from the last three years, as well as details on any ongoing recovery proceedings.
The SECP is inviting stakeholders to review the draft amendments on its website and submit written feedback by November 19, 2025, to [email protected]
