SECP launches major compliance drive, sends notices to 28,761 companies over hidden ownership concerns

The Securities and Exchange Commission of Pakistan (SECP) has issued show-cause notices to 28,761 companies for failing to disclose

ISLAMABAD, September 4, 2026: The Securities and Exchange Commission of Pakistan has intensified its efforts to ensure corporate compliance by issuing show-cause notices to 28,761 companies that failed to provide details of their Ultimate Beneficial Owners (UBOs).

SECP officials, while speaking to *Minute Mirror*, confirmed that notices were issued to company chief executive officers and authorized representatives through the SECP e-Portal and registered email addresses. The companies have been provided a 30-day period to submit Form-19 along with verified documents proving compliance with mandatory ownership disclosure requirements.

Under Section 123A of the Companies Act, 2017, all registered companies in Pakistan are required to disclose their Ultimate Beneficial Owners while submitting annual returns.

An Ultimate Beneficial Owner refers to the individual who ultimately owns, controls, or benefits from a company, either directly or indirectly. The criteria include individuals holding 25 percent or more shares or voting rights, as well as those exercising significant influence or control over company decisions through other arrangements.

A senior SECP official told *Minute Mirror* that the purpose behind introducing UBO disclosure requirements is to identify the actual individuals controlling corporate entities and eliminate the possibility of companies being used to conceal ownership.

According to SECP statistics, Pakistan had 301,615 registered companies as of June 2026. The regulator has expressed concerns that some businesses may use complicated ownership structures to hide the identities of individuals who actually control or benefit from these entities.

SECP officials stated that the compliance campaign is designed to enhance corporate governance and bring Pakistan’s regulatory framework closer to international standards, including recommendations made by global financial monitoring bodies such as FATF.

The officials explained that accurate UBO records allow authorities to track the real beneficiaries behind companies, helping prevent the misuse of corporate structures for money laundering, tax evasion, and concealment of unlawful assets.

“UBO information provides clarity about who ultimately owns and controls a business. It plays an important role in protecting the financial system from illegal activities,” an SECP official said.

Financial experts believe that hidden ownership structures have historically created challenges for regulators by making it difficult to identify individuals responsible for financial decisions. They added that maintaining a centralized and verified database of beneficial owners can improve accountability and discourage misuse of companies.

Another SECP official told *Minute Mirror* that the initiative goes beyond administrative compliance, as it aims to safeguard Pakistan’s corporate environment and ensure that registered companies cannot become vehicles for unlawful financial practices.

Companies that fail to submit required information within the given deadline may face legal proceedings and penalties under the Companies Act, 2017.

SECP officials reiterated that the commission will continue monitoring compliance levels across different sectors and take necessary action against companies that fail to meet ownership disclosure obligations.

The move is expected to bring significant changes to Pakistan’s corporate landscape by ensuring that businesses maintain updated records of their actual owners. The regulator believes that greater transparency will strengthen investor confidence, improve accountability, and reduce opportunities for individuals to operate through anonymous corporate structures.