Firm Registration Process in Pakistan
A number of critical steps need to be followed to get a Firm registered. Here is a comprehensive guide to help you get through the Firm Registration Process in Pakistan. The following process of Firm Registration will help you in knowing how to register your firm in Pakistan: –
Firm Name Approval
The first step is to choose a valid Firm name and get it approved from the Registrar. The process of naming your Firm must be understood to save time and hassle free under Companies Ordinance, 1984.The use of certain Types of words are prohibited for use in a Firm name..
- No such name which is already in use by another Firm can be used again.
- No such name must be used which is unacceptable to any religious sect.
- The name must not be deceptive or inappropriate in usage.
- The availability of the Name needs to be checked first. Following words and phrases are not allowed to be taken as part of the Firm name while registering your Firm / Business in Pakistan.
- Association/ Benevolent/ Foundation:This word may be included in the name of companies to be established on grant of license by the Commission under section 42 of Ordinance or which are established as a Trade Organization under Trade Organizations Ordinance, 2007.
- Society:This word may be included in the name of companies for which proper justification is provided.
- Fund:This word may be allowed in the name of company if the company will function as Non-Banking Financial Company under the license of Specialized Companies Division of the Commission or to public sector company on grant of license by the Commission under section 42 of the Ordinance.
- Council:This word may be included in the name of companies to be established on grant of license by the Commission under section 42 of Ordinance. This word is allowed to Sports Association and Professional Bodies.
- Chamber of Commerce:This word may be included in the name of entities which are being formed as Trade Bodies under license under Trade Organization Ordinance, 2007, from Director General Trade Organization, Ministry of Commerce Government of Pakistan.
- Authority/ Register/ Registered/ Co-operative/ Bureau/ Division
- Trust:This word may be included in the name of REITs to be established on grant of license by the Specialized Companies Division of the Commission
- Assurance/ Assurer/ Insurance/ Insurer/ Re-Assurance/ Re-Assurer/ Re-Insurance/ Re-Insurer: These words may be included in the name of companies involved in Insurance, Assurance, Re-insurance and Reassurance business. Prior permission of Insurance Division of the Commission would be required at the time of Incorporation.
- Board: This word may be included in the name of companies desirous to engage in the business of Paper &/or Board or to public sector companies.
- Bahria/ Askari/ Fouji/ Fazaiya/ Cadet: This word may be included in the name of companies to be established by the relevant agency.
- Banks/Banking Company:These words may be included in the name of companies on the basis of permission from State Bank of Pakistan undersection 8 of the Banking Companies Ordinance, 1962 and section 5(1) of Microfinance Institutions Ordinance, 2001.
- Charter/Chartered: These words may be included in the name of companies having charter from the sovereign authority of the Federation and the Province.
- Exchange/Bourse:These words are only allowed in the name of Stock Exchange, Commodity Exchange and Exchange Companies subject to NOC from relevant authority.
- Familiar Trade Names:These words may be included in the name of companies only if NOC of familiar trade name user is provided or proper documentary evidence of ownership/use of trade name is furnished by the applicant.
- Famous/ Distinct Personalities:These words may be included in the name of companies if proper justification and approval of relevant authority is provided.
- Federation:This word may be included in the name of Sports Federations licensed under section 42 of Ordinance or trade bodies under Trade Organizations Ordinance, 2007.
- Federal:This word is allowed in the name of company with the approval of the Commission, if the proposed company has a connection or any patronage with Federal Government.
- Group:This word may be included in the name of companies if use of this word implies several companies under single corporate ownership and applicants have to provide evidence of subsidiary/associate relationship with two or more other Pakistani Companies.
- Holding:This word may be included in the name of company which establishes that it qualifies to be a holding company as defined in Section 3 of the Ordinance i.e. the company has object clause showing its intention to act as holding company after incorporation.
- Institution:This word may be included in the name of the public sector companies.
- Investment Finance, Investment Advisory, Leasing, Asset Management, Housing Finance: This word may be included in the name of Non-Banking Finance Companies, REITs and brokerage houses or any public sector financial institution or investment company.
Partnership Deed for Firm Registration in Pakistan
A Partnership deed is a partnership agreement agreed, written and signed on by all the partners constituting the Firm in the presence of witnesses. A partnership usually has a minimum 2 and a maximum of 20 members who are jointly responsible for all matters relating the business.
The nature of business should be mentioned clearly and must be legally upright; illegal or irrelevant objectives mentioned in partnership deed result in the rejection of registration by the registrar.The profit and loss ratio needs to be clearly mentioned in the deed.
The Partnership deed must be as per Partnership act 1932, so that before preparation of partnership deed, Act should be keep in your mind or prepared by experienced people or lawyers, who know about all the relevant clauses. This deed must be printed on stamp paper of Rs. 1000/. All issues that can later result in a clash of opinion or annulment of partnership must clearly be discussed in the deed.
Requirements To Register A Partnership
- Each partner’s– Full Name, Father or Husband’s Name, Residential Address and Occupation and copy of the National Identity Cards of each partner.
- Partnership deed on stamp paper. A Partnership Deed is the document containing an agreement that details the rights and obligations of each partner participating in the venture.
- Proof of the address of business location usually utility bills.
- If the business location has been taken on then the rent deed is required.
- Copy of the original receipt of Partnership fee. This fee needs to be deposited at the National Bank of Pakistan.
- Signature of all the partners in partnership\firm business in presence of a registrar or an authorized officer.
Additional Requirements For Firm Registration
- National Tax Number from Federal Board of Revenue
- Advance payment of Income Tax as required by the Income Tax Ordinance of 2001.
- Accounting records of the partnership business, a properly maintained profit and loss account and balance sheet.
- Registration from any other authority if required under any law of business to be undertaken.
Submission of Documents for Firm Registration
Once all the documents are ready, a partnership may be registered with the Registrar of Firms of an area where the office of the firm is situated or proposed to be situated. A statement in prescribed form must be delivered to the relevant registrar stating:
- The Name and Duration of the Firm.
- The place or principal place of business of the Firm.
- Names of any other places where the Firm will carry out its business.
- The date when each partner joined the firm.
- Full names of all partner and their permanent addresses (information should in confirmation with the NIC)
Firm Registration Fee In Pakistan
Once all the required documents are collected the application form (Form-1) is downloaded. The partnership deed is prepared on a stamp paper of Rs.1000/- and the form filled accurately.
The statement must be signed by all the partners of the firm for the time being or any authorized agent on their behalf. Furthermore, the statement must be verified by the persons signing it. A registration fee of Rs.1000/- is submitted at the National Bank of Pakistan and the challan form attached.
An affidavit stating the credibility of the documents and the location of office is prepared on a stamp paper of Rs.5/- The application is submitted in the Industrial Department Head office in Islamabad. The application is processed within 7 working days.
Post verification of all documents by the registrar, the entry of the firm is made in the Register of Firms and a respective statement is filed for the creation of the new partnership.
Commencement of Business
Once the Firm has been registered and the firm registration is completed, the business may be started. The Profit and loss balance is kept and the annual income tax sheet maintained.. If any partner wishes to leave the Firm at any point the partnership deed is referred to.