Pakistan

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DOING BUSINESS

 


Local business incentives - Legal forms of companies - Registration and licensing procedures - Legal framework - Foreign exchange control - Regulations concerning equity investment - FDI inflows - Expertise of the political risk

Local business incentives

Pakistan offers different aids and incentives to foreign investments. Incentives depend on the sector of the company. To get information on aids and incitements, investors can contact both the Pakistan Board of Investment, or the Ministry of the concerned sector. For industries specialized in exports, an Export Processing Zone (KEPZ) has been created in Karachi to attract foreign investors. The KEPZ grants various aids and incitements such as federal, provincial and council tax exemptions, duties and taxes exemptions for imports of machines and industrial equipment, administrative opportunities concerning imports and exports etc. Finally to accelerate the increase of foreign industrial investments, the Special Industrial Zones (SIZs) have been created in order to develop the 12 Pakistan's industrial provinces. The SIZ offer tax advantages, credits and administrative opportunities.

 

Legal forms of companies

Form Number of partners/shareholders Minimum and/or maximum capital Liability Registration fee Release of financial documents
Private Company Minimum 2. PKR 100,000 Liability is limited to the amount contributed. They depend on the amount of the capital subscribed. From PKR 100 to 5,000. Yes
Public Company Minimum 7 PKR 100,000 Liability is limited to the amount contributed. They depend on the amount of the capital subscribed. From PKR 100 to 5,000. Yes
Company limited by shares. Minimum 2. No minimum capital. Liability is limited to the amount contributed. They depend on the amount of the capital subscribed. From PKR 100 to 5,000. Yes
Company limited by guarantee Minimum 2. No minimum capital. Liability is limited to the amount of the guarantees. They depend on the amount of the capital subscribed. From PKR 100 to 5,000. Yes
Unlimited Company Minimum 2. No minimum capital. Liability is unlimited. They depend on the amount of the capital subscribed. From PKR 100 to 5,000. Yes

Registration and licensing procedures
The company's founders have to establish a "Memorandum" in accordance with the principles of the "Companies Ordinance " of 1984. Depending on the activity of the company, founders must obtain an authorization from the different ministries concerned. Registration is made with the different authorities where the company is located.

Foreign exchange control
There is no restriction on exchange controls in Pakistan. Free repatriation of profits and capital is carried out.

Regulations concerning equity investment
A majority holding interest in the capital of a local company is legal in Pakistan except in certain sectors where investments are subject to limitations.  


Foreign Direct Investment inflows in Pakistan

FDI inflows 2003 2004 2005 World rank (*)
2005
FDI inflows (USD million) 534 1118 2183 ..
Source : UNCTAD - World Investment Report
Note : (*) World Rank = UNCTAD Inward FDI Performance Index. It is a measure of the extend to which a host country receives inward FDI relative to its economic size. It is calculated as a ratio of the country's share in global FDI inflows to its share in global GDP.

 

Last modified in 2006 - ongoing update
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