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The Securities and Exchange Commission of Pakistan (SECP) has notified key amendments to the Companies (Further Issue of Shares) Regulations, 2020, strengthening corporate governance standards and enhancing protection for minority shareholders in listed companies.
Under the amended regulations, SECP has reinforced the principle of “one share, one vote” by ensuring that ordinary shares retain at least 75 percent of the total voting power of a company. The regulator has also capped voting rights for shares with varied privileges at a maximum of five votes per share to prevent excessive concentration of control.
The amendments require that ordinary shares carrying voting rights must receive the same percentage or ratio of dividends per share. Additionally, ordinary shares issued with varied rights must be listed securities, ensuring transparency, effective price discovery, and investor confidence in the market.
SECP said the changes are designed to align economic benefits with voting power, preserve the fundamental importance of ordinary shares, reduce conflicts of interest, and promote fair and equitable governance across listed companies.
The revised framework follows an extensive consultation process involving the Pakistan Stock Exchange, Central Depository Company, NCCPL, listed companies, consultants, professional bodies, and law firms. SECP reviewed stakeholder feedback before finalising the amendments to ensure market stability and investor protection.
