SECP Declares 39,704 Companies Inactive for Failing to Submit Mandatory Returns

ISLAMABAD: (News Desk) – The Securities and Exchange Commission of Pakistan (SECP) has declared 39,704 companies inactive after they failed to submit their annual returns and/or financial statements for four consecutive years.

According to an SECP announcement issued on October 31, the companies have been placed under the status of “Inactive by Registrar” to improve the reliability of Pakistan’s corporate register and prevent dormant businesses from being misused for illegal activities.

The commission said the inactive status would be reflected in its official system and remain accessible to banks and other relevant stakeholders. These companies will not be allowed to open new bank accounts or access financial services until they submit their outstanding documents and restore their active status.

They will also be restricted from registering changes in their directorships until they fulfil the required legal obligations.

According to the SECP, Lahore accounts for the highest number of inactive companies at 13,927, followed closely by Islamabad with 13,859. Karachi has 4,868 such companies, Peshawar 2,031, Multan 1,861, Faisalabad 1,384, Gilgit 1,102, Quetta 436 and Sukkur 236.

The SECP emphasised that submitting annual returns and, where applicable, financial statements is a mandatory legal requirement under the Companies Act, 2017. These documents help maintain updated public records regarding companies, their ownership structures and management.

The regulator warned that prolonged failure to submit statutory documents weakens the corporate registry and can create obstacles in efforts to prevent money laundering and terrorist financing.

Meanwhile, Pakistan’s corporate sector continues to expand, with the total number of registered companies reaching 317,002 by the end of September 2026.

The SECP registered 43,559 new companies during the previous financial year, marking a 24 per cent increase compared with the preceding year. The commission also reported that company name reservations and incorporation processes had become fully digital, with 99.9 per cent of newly registered companies completing the process online.

SECP Chairman Dr Kabir Ahmed Sidhu said maintaining a reliable corporate registry was essential for building confidence in the business sector.

“A clean and credible registry is the bedrock of trust in the corporate sector. SECP is protecting the integrity of the financial system while giving companies a clear opportunity to return to compliance,” he said.