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The Securities and Exchange Commission of Pakistan (SECP) has proposed a landmark amendment to the Companies Act, 2017 by introducing Section 42A, which would establish a dedicated legal framework for licensing and regulating Waqf management companies. These entities will be responsible for administering Waqf assets strictly under Shariah principles and the declared objectives of each Waqf.
This initiative represents Pakistan’s first formal step toward corporatizing Waqf governance, inspired by global best practices in Islamic finance and social impact investment. The framework will support modern Waqf structures such as cash Waqf, investment Waqf, Waqf-linked Sukuk, and Waqf mutual funds, helping to mobilize capital for charitable and developmental causes.
Under the proposed rules, Waqf management companies will function as not-for-profit organizations, ensuring perpetual preservation of Waqf assets, strict adherence to Shariah compliance, and immutability of Waqf objectives. Strong governance, fiduciary oversight, and the appointment of qualified Shariah advisors will also be mandatory. Non-compliance may result in regulatory sanctions and penalties.
The SECP emphasized that this reform aligns with its broader vision of reviving Islamic social finance institutions, building public trust, and channeling Waqf resources into transparent, professionally managed structures that can significantly contribute to welfare and development in Pakistan.
