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Tag: SECP

  • SECP facilitates companies in IAS 39 requirements

    SECP facilitates companies in IAS 39 requirements

    ISLAMABAD: The Securities and Exchange Commission of Pakistan (SEC) has allowed relief registered companies that are applying IAS 39/principles of IAS 39 (for Available for Sale equity instruments).

    The SECP issued S.R.O. 414 (I)/2020 and allowed following relief from the requirements contained in IAS 39 in relation to their Available for Sale (AFS) Equity Investments as follows:

    (a) The company/entity can opt to show impairment loss (if any, due to significant or prolonged decline in fair value of AFS equity investment portfolio), as at March 31, 2020, in the statement of changes in equity.

    (b) If the above short-term relief is opted, the company/entity shall disclose in the notes to the financial statements:

    (i) amount of impairment loss included in the statement of changes in equity under (a) above;

    (ii) amount of profit or loss after tax, arrived at by accounting for the impact of impairment loss in accordance with IAS 39; and

    (iii) Earnings per share based on the (ii) above.

    (c) The dividend income and actual realized gain/loss arising from the de-recognition of AFS equity instruments shall be recognised in the profit and loss account in accordance with the requirements of IAS 39.

    (d) The amount of loss taken to equity as per (a) above, shall be treated as a charge to profit and loss account for the purpose of distribution as dividend, where applicable.

    (e) The amount taken to equity as per (a) above for an AFS equity instrument, adjusted with the fair value change of this AFS equity instrument during the period from April 01, 2020 to June 30, 2020, shall be considered for impairment in accordance with the requirements of IAS 39.

    (f) The impairment loss (if any), as of June 30, 2020, as per (e) above shall be taken to the profit and loss account for the year/period ending June 30, 2020.

    The SECP said that companies/entities willing to follow the full requirements of IAS-39 as applicable are encouraged to do so.

  • One month free coverage to motor insurance policy holders

    One month free coverage to motor insurance policy holders

    ISLAMABAD: Securities and Exchange Companies of Pakistan (SECP) on Wednesday directed insurance companies to allow one month free coverage to motor insurance policy holders.

    The regulator in a press release said that in light of the outbreak of COVID-19 (Coronavirus) it has been advised non-life insurance companies to grant one month free of cost extension in insurance coverage to all motor insurance policyholders.

    The ongoing lockdown situation across the country has resulted in a significant decline in traffic density. With intercity public transport almost at a significant halt and limited within the city commute, it can be inferred that the policyholder claims in relation to motor insurance policies, would also have significantly declined.

    Taking into account the decline and/or the anticipated low claim ratio in motor business due to lockdown, insurance companies have been encouraged to take steps to facilitate and pass on the benefit of low claim ratio to motor insurance policyholders.

    As the fight against COVID-19 pandemic continues, it becomes imperative that insurance industry show its commitment to serve its policyholders by providing maximum relief and facilitation in all operational aspects. SECP believes that such good gestures in these difficult times will further increase policyholder’s confidence in the insurance sector.

  • SECP extends submission of AML/CFT quarterly information up to May 31

    SECP extends submission of AML/CFT quarterly information up to May 31

    ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) has extended the date up to May 31, 2020 for submission of mandatory information related to anti money laundering (AML)/ counter financing of terrorism (CFT) for the corporate sector.

    The SECP on Monday due to the recent outbreak of pandemic Coronavirus (COVID- 19) and its impact on the public health and the lockdown situation in the country, the Regulated Persons are facing various difficulties while ensuring compliance with regulatory requirements related to reporting and submission of information in the manner prescribed under Directive 55(1)/2020 dated January 28, 2020.

    The term Regulated Person (“RP”) has been defined in the Anti Money Laundering and Countering Financing of Terrorism (AML-CFT) Regulations, 2018 (“the Regulation”) as the “Regulated Person” means Securities Brokers, Futures Brokers, Insurers, Takaful Operators, NBFCs and Modarabas for the purposes of these regulations.

    The Securities and Exchange Commission of Pakistan (SECP) in discharge of its statutory responsibilities for effective AML/CFT regulation of its regulated financial sector seeks to clarify as follows:

    i. Relaxation in submission of quarterly information under Directive 55(1)12020:

    In view of Directive 55(1)12020 dated January 28, 2020 a thirty days extension in filing of AML/CFT quarterly information is provided to all RPs facing difficulties in submission of information for period ended March 31, 2020 that is required to be submitted by April 30,2020.

    Now, the said extension to submit quarterly information is being extended till May 31, 2020 for the quarter ended March 31, 2020 only.

    ii. Companies to make necessary work arrangements for ensuring regulatory compliances:

    As safety of employees is priority of the companies during the coronavirus (COVIT-19) outbreak, therefore RPs are encouraged to make necessary arrangements for the use of technology and related applications in order to enable them to work from home to meet the regulatory compliances.

  • SBP advises banks to register security interest under STA

    SBP advises banks to register security interest under STA

    KARACHI: State Bank of Pakistan (SBP) on Friday advised banks, microfinance banks and development financial institutions (DFIs) to register their security interest under secured transaction laws.

    The SBP in a circular said that with a view to provide for registration of charge on security/collateral offered by un-incorporated entities including sole proprietorships and partnerships and thereby enhancing their access to finance, The Financial Institutions (Secured Transactions) Act, 2016 (STA) was promulgated on July 1, 2016.

    The government has authorized the Securities and Exchange Commission of Pakistan (SECP) to operate Secured Transactions Registry (STR) to record statements in relation to security interests created by entities under STA. SECP is going to launch the Secured Transactions Registry (STR) under the STA on April 27, 2020 for registration of security interests on movable assets of entities, other than companies.

    In view of the above, all the banks, microfinance banks and DFIs are advised to register their security interests against movable assets of entities for future as well as prior security interests (i.e. security interests created before the operationalization of the STR as provided under section 73 of the STA) in the STR.

    The security interest has been defined as: “a right, title, encumbrance or interest of any kind upon movable property created or provided for by a security agreement in relation to a transaction that in substance secures the payment or performance of a customer’s obligation under a finance without regard to the form of the transaction or the terminology used by the parties or the identity of the person who title to the movable property, and includes any charge, mortgage, hypothecation, fixed charge, floating charge, assignment, lien, pledge, assignment of receivable by way of security and transactions under which a secured creditor retains title such as a finance lease, hire purchase agreement, sale and lease back arrangement, conditional sale agreement and retention of title arrangement, having similar effect.”

  • SECP highlights difficulties in present tax regime

    SECP highlights difficulties in present tax regime

    ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) has highlighted difficulties faced by corporate sector due to prevailing tax regime.

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  • SECP relaxes regulatory requirement for AMCs

    SECP relaxes regulatory requirement for AMCs

    In a bid to mitigate the economic fallout of the ongoing COVID-19 pandemic, the Securities and Exchange Commission of Pakistan (SECP) has announced a series of relaxations in regulatory requirements for asset management companies (AMCs).

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  • SECP shuts registration offices, facilitation centers amid coronavirus outbreak

    SECP shuts registration offices, facilitation centers amid coronavirus outbreak

    The Securities and Exchange Commission of Pakistan (SECP) has announced the closure of Companies Registration Offices (CROs) and facilitation centers until further notice as a preventive measure against the spread of coronavirus disease (COVID-19).

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  • SECP extends insurance license renewal date

    SECP extends insurance license renewal date

    ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) has extended license renewal date for insurance brokers in the wake of coronavirus outbreak.

    The SECP issued Circular No. 12 on Monday to extend the date for license renewal for insurance business.

    The SECP said that considering the gravity of the pandemic coronavirus (COVID-19) on public health and lockdown situation in the country, insurance brokers, insurance surveyors and authorized surveying officers are facing difficulties while ensuring compliance with regulatory requirements related to renewal of license under the Insurance Ordinance, 2000.

    The SECP said that in order to facilitate the insurance brokers, insurance surveyors and ASOs during the ongoing pandemic, the regulator issued following guidelines regarding renewal of licenses:

    (i) Any insurance brokers/insurance surveyor/ASO whose license has expired or will expire during the period from March 15, 2020 to May 15, 2020 shall continue to carry on its business without renewal of its current license with the commission;

    (ii) The above relaxation shall be effective for a period of two months i.e. it shall end on May 15. The respective insurance brokers, insurance surveyors, and ASOs shall be bound to file their applications prior to the deadline of May 15, 2020.

    (iii) Upon receipt of the application, license shall be renewed effective from the date of expiry of the previous license.

    (iv) Insurance brokers, insurance surveyors and ASOs facing difficulties to arrange documents, required under the Ordinance for renewal of license may avail the above mentioned relaxation.

    (v) While surveyors/ASOs can file applications online through e-services, insurance brokers may send their applications to the commission via email until the expiry of the lockdown; and

    (vi) All insurance companies/ general takaful operators shall continue to do business with insurance brokers /insurance surveyors/ASOs considering the grace period of two months for any license expired after March 15, 2020.

  • SECP announces relief for corporate sector to dilute coronavirus impact

    SECP announces relief for corporate sector to dilute coronavirus impact

    ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) on Wednesday announced regulatory relief for corporate sector in order to dilute impact of coronavirus.

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  • SECP discusses stock market situation

    SECP discusses stock market situation

    ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has discussed the situation of the stock market, which triggered halt for third time in this week.

    The SECP team lead by the Chairman SECP and Commissioner(SM) held a detailed meeting with the CEOs of Pakistan Stock Exchange, National Clearing Company and Central Depository Company (Self-Regulatory Organizations – SROs) this morning, to review and discuss the stock market situation, risk management and business continuity.

    The index based market halts were triggered for the third time during this week. This cooling-off period gave an opportunity to investors to align their trading strategy and collection of margins by the Clearing Company.

    The participants of the meeting affirmed that risk management system was functioning efficiently and margins were being collected timely.

    The Market operations were running smoothly as a whole. The SROs further apprised that their business continuity plans and disaster recovery setup was in place based on SECP’s earlier instructions.

    The Chairman SECP emphasized on conducting drills to ensure remote operations of trading, clearing, settlement and custody services while allowing remote access of market participants to such systems in case onsite operations or physical access was impacted.

    He also suggested adoption of further preventive measures against spread of coronavirus.

    The SECP advised SROs to remain vigilant, continue to provide uninterrupted access to market participants and ensure effective risk management while maintaining actively engagement with their boards of directors and committees for close coordination.