SECP approves significant reduction in corporate action timelines

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has approved amendments to the Companies (Further Issue of Shares) Regulations, 2020, introducing a significant reduction in the overall timelines for bonus and right issues to maximize shareholder value.
Historically, bonus and right issues required up to 85 days and 181 days, respectively, to complete the entire process—from initiation to the credit of shares in shareholder accounts. Under the revised framework, a bonus issue will now be concluded within just 11 days (an 87% reduction) and a right issue within 53 days (a 70% reduction).
Continuing with its inclusive and consensus-driven consultative approach to market reforms, the SECP initially published a consultation paper inviting stakeholder feedback on potential areas for improvement. The SECP held extensive in-person and online engagements with key stakeholders, including the PSX, CDC, NCCPL, leading Consultants to the Issue, legal professionals, and financial experts, and subsequently issued a draft of the amendments for further consultation. All feedback received during this process was thoroughly evaluated before the amendments were approved.
SECP further stated that notable reductions in the process include a shorter period for the notice of book closure, a single-day book closure period to harness the benefits of technological developments at capital market institutions, faster submission and clearance of offer documents, quicker credit of Letters of Right, and expedited allotment of right and bonus shares.
These reduced timelines mean shareholders will get quicker access to bonus and right shares, enabling them to capitalize on trading opportunities earlier.
The amendments will be effective from October 01, 2025, in conjunction with consequential amendments to the Pakistan Stock Exchange Regulations and the Procedures of the Central Depository Company.
Furthermore, to foster a more investor-friendly environment and enhance the attractiveness of Pakistan’s capital markets, the SECP is also considering—in consultation with relevant stakeholders—measures to reduce the time required for dividend payments and to address concerns regarding the opening of Roshan Digital Accounts (RDA) with multiple brokerage houses and the transfer of funds between RDA accounts held by the same person. Ends