The name of the company with the word “limited” as the last word of the name in the case of a public limited company, and the parenthesis and words “(Private) Limited” as the last words of the name in the case of a private limited company, the Province or the part of Pakistan not forming part of a Province, as the case may be, in which the registered office of the company is to be situate, the objects of the company and, except in the case of a trading corporation the territories to which they extend that the liability of the members is limited, the amount of share capital with which the company proposes to be registered, and the division thereof into shares of a fixed amount any one or more persons so associated may, in like manner, form a private company.
MINIMUM & MAXIMUM NUMBER OF MEMBERS:
In a private limited company, minimum two and maximum fifty persons may become shareholders therein.
MINIMUM NUMBER OF DIRECTORS:
A private company must have at least two persons who should be individuals to constitute a Board of Directors (BOD) with powers vested in it to conduct the business and affairs of a company.
MAXIMUM NUMBER OF DIRECTORS:
Maximum number of directors is restricted upto 50. The directors shall meet at least once in a year.
MINIMUM NUMBER OF SHARES:
Each subscriber is required to hold at least one share in his /its own name or in the name of the company or institution he is to represent on the BOD of a company.
STATUS OF THE COMPANY:
It may be an associate, subsidiary or wholly-owned subsidiary of a foreign company incorporated abroad or its share capital may be held partly by one or more foreign investors (companies or individuals) together with the any number of local shareholders not exceeding fifty in number.
TRANSFERABILITY OF SHARES:
The right to transfer shares is restricted as per Articles of Association of a company.
INVITATION TO PUBLIC:
Invitation to public to subscribe capital is prohibited
It cannot issue a prospectus to invite general public to subscribe to its shares, debentures or deposits.
COMMENCEMENT OF BUSINESS:
A private company may commence business immediately after receiving the certificate of incorporation.
QUORUM OF GENERAL MEETING:
Two members personally or by proxy present at the general meeting shall be a quorum representing in the aggregate not less than 25% of the total voting power of a company.
TENURE OF DIRECTORS:
A director is to be appointed for three years term. Thereafter, he is eligible for reappointment through election of directors for a further period of three years.
BOOKS OF ACCOUNT:
Books of account are required to be maintained at Registered Office of a company and are subject to audit. Company may keep books of account at some other place other than the registered office address subject to the prior intimation to the Registrar of Companies.
AUDITORS:Auditor is to be appointed annually by a resolution of shareholders passed at their annual general meeting.A company having share capital of three million or more is required to appoint a Chartered Accountant within the meaning of Chartered Accountants Ordinance, 1961 as auditors of a company.
BORROWING:Funds in local and foreign currencies may be borrowed for working capital and other financial needs from its head office and affiliates, banks and others in Pakistan, subject to the limit laid down in the Foreign Exchange (Regulations (FER) and the Prudential Regulations issued by the State Bank of Pakistan as applicable from time to time.
A private limited company which is not a subsidiary of a public company may make loan to its directors, firm in which any director or his relative is a partner or director in a private limited company.
REMITTANCE OF PROFIT:
Remittance of profits in the shape of dividend to non-resident shareholders after being subject to the tax due thereon is highly facilitated under a standard procedure laid down in FER.
INTER COMPANY INVESTMENT:
A private limited company may make investment in any of its associated companies or associate undertaking to any extent without seeking approval of its shareholders.
DISCLOSURE OF INTEREST BY DIRECTOR:
Every director of a company who is directly or indirectly, concerned or interested in any contract or arrangement by or on behalf of the company shall make a disclosure of his interest.
RIGHT OF COPIES OF FINANCIAL STATEMENTS AND AUDITORS’ REPORT:
A shareholder of a company shall be entitled to receive copies of the financial statements director’s report, and the auditors’ report on payment of fee as fixed by the company.