Securities and Exchange Commission of Pakistan (“SECP”) on 1’ April’ 2020 has issued Circular No.10/2020 to facilitate the listed companies‘ communication with shareholders, holding of annual general meetings and issuance of financial statements. Previously, on 22’ March’ 2020, SECP has issued Circular No.6/2020 relaxing compliance with certain provisions of the Companies Act, 2017 for private companies.
The purpose of this circular is to provide regulatory relief to listed companies while complying with the requirements of the Companies Act, 2017 (the “Act”) including the following:
- Listed companies whose financial year ended on 31’ December’ 2019 are allowed thirty (30) days extension in holding their Annual General Meeting (“AGM”) to lay their financial statements before the members.
- Public companies can disseminate the notices and annual reports to the members electronically via email and WhatsApp numbers.
- For filing of financial statements of first quarter due on 30’ April’ 2020, SECP shall facilitate extension in time in response to application to be filed with it via e-mail.
- Interim Financial statements other than first quarter’s (e.g. financial statements for Third Quarter ended 31’ March’ 2020), are normally required to be filed by 30’ April’ 2020. The law does not provide relaxation in time for filing of such interim financial statements. SECP advises the listed companies to prioritize the public safety while complying with the requirements of the law. SECP further indicates its intentions to be lenient while enforcing compliance and it will give due consideration to all the underlying circumstances.
- In respect of the requirement to hold meeting of Board of Directors of listed companies once in each quarter, SECP advises that law does not provide relaxation in time for filing of such interim financial statements and that the listed companies should prioritize the public safety while complying with the requirements of law. SECP further indicates its intentions to be lenient while enforcing compliance and it will give due consideration to all the underlying circumstances.
- SECP also encouraged companies to make arrangements for the use of technology and related applications by employees enabling them to work from home while meeting regulatory compliance on behalf of the company during the COVID-19 outbreak.
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