I have recently Incorporated my Startup PakTrips as a Private Limited company. We have been taught how to register a Private company in Founder Institute and now I am publishing a simple straight forward guide to help you guys register your company easily too. Here are some basic details and flowchart for registering your Startup.
Why is it important to register Startup Company?
You may wonder why you should register your startup when you can run operations smoothly. Also, you don’t want to spend cash on these things but remember it’s very important that you should register the company as soon as possible. It will save you from later hassles and problem.It’ss important to be incoporated company if you are thinking to raise fund. Investors only fund in registered companies. You may also sign agreements with your partner which later saves you from getting into equity fights later on. There are many other benefits of registering a startup like you and your startup become private entities, you can get free credits from many companies,..etc
Type of company
There are many types of Companies registration. Most common is a private limited company which means you have some partners and you are not trading publicly. You need to have at least two persons in your company, One CEO and another CTO. If you don’t have another person, you can choose your father or Mother as a partner.
Basic registration cost is around 8000 PKR but it may vary. Lawyers charge extra for their services. A normal lawyer charge 25k PKR for registration in Islamabad. Registration costs are cheaper when you use SECP online service. Their online portal only works in Internet explorer.
After completing registration you will get company registration certificate and some other documents. SECP requires you to submit CEO in less than 60 days. Lawyers charge 5k PKR extra for this service. You also have to submit a Tax return on a monthly basis for which you have to pay some extra charges to your lawyer.
FlowChart Of Company Registration in Pakistan
Here is a complete flowchart of registration. Thanks to Madam Natalya Kamal for this Guide.
1. AVAILABILITY OF NAME
- Check if your proposed name is available on the following link https://www.secp.gov.pk/company-name-search/
- Seek reservation of availability of name of the proposed company from Company Registration Office (CRO) Islamabad by making simple one page application on payment of fee of Rs. 500/. You may list in order of priority more than one name. Alternatively, you can use E-services for reserving name (fee will be Rs. 200).
- Sign up as a new user on the following link (make sure your system is compatible, explorer, POP3 email account only etc) https://eservices.secp.gov.pk/eServices/ Signup as a new user and fill out the process for company name reservation.Detail help is at the following links: https://www.secp.gov.pk/eservices/company-incorporation/
and FAQs on E-services are at the following link https://www.secp.gov.pk/document/eservices-faqs/?wpdmdl=17263
- If you choose to use e-services then you will upload your articles and memorandum and all other supporting documents on the e-services site. Other statutory forms are available on it as well.
2. DOCUMENTS FOR REGISTRATION OF A PRIVATE COMPANY
CRO usually takes two to three days to send you confirmation of availability of name, which is reserved for 90 days during which you must submit all your documents for company incorporation. Start working on drafting of your memorandum and articles of association at the same time as you send off your name availability application.
MEMORANDUM AND ARTICLES OF ASSOCIATION [Four] printed copies of Memorandum and Articles of Association duly signed by each subscriber in the presence of at least one witness. One copy should be affixed with special adhesive stamps at the rates prescribed under the Stamp Act, 1899. (only if giving documents to CRO offline method). Sample memorandum and articles according to nature of business are at the following link: https://www.secp.gov.pk/company-formation/memorandum-and-articles-of-association/memorandum-of-association/
FORM – 1, FORM 21, FORM 29
- FORM 1: Declaration of compliance with the requirements of the Companies Ordinance, 1984.
- FORM 21: Notice of situation of registered office of the company.
- FORM 29: Particulars of Directors and Officers including the Chief Executive, Secretary etc All forms available at https://www.secp.gov.pk/companyformation/formsapplications-schedule-of-filling-of-returns/statutoryforms/
NOTE: If you are incorporating your company through e-services your witnesses to the Memorandum and Articles of Association will be NIFT and you would need to obtain digital certificates from them for all the promoters of the company in order to sign electronically all documents like Memorandum and Articles of Association and other statutory forms. You should after getting name reservation from SECP send application to NIFT for obtaining digital certificates. NIFT website link is as follows: https://secp-live.niftetrust.com/secp/
The company registration fee is pegged to your share capital and you can calculate it online at the following link:
POWER OF ATTORNEY
To remove any deficiency in the documents or to make amendments or alterations in the Memorandum and Articles of Association, the promoters may execute a power of attorney in favor of one of the promoters or any consultant/adviser/lawyer. He may also be authorized to file the documents and collect the certificate of incorporation. The Power of Attorney is required to be on a Non-Judicial stamp paper and duly attested by a Notary Public.
Once the Memorandum and Articles of Association are prepared a covering letter, addressed to the CRO is sent requesting for an incorporation certificate. This letter should set out the list of documents being filed and evidence of fee paid (only for offline method).
The accompanying documents are:
- Four staple bound copies of the MoA and AoA (including one stamped copy).
- Forms 1
- Form 21
- Form 29
- Deposit receipt for payment of filing of Forms 1, 21 and 29 as well as registration fee for the Constitution of the company.
- Availability of name certificate.
- Notarized authority letter/power of attorney given to the person involved in the incorporation procedure.
- Notarized copies of the identification documents (CNICs) of the directors listed in Form 29.
Hope this guide might help you.
Thanks to Madam Natalya Kamal For this document. ( Natalya Kamal Barrister-at-Law Advocate High Court)