The Securities and Exchange Commission of Pakistan (SECP) has simplified the licensing process for companies backed by foreign sponsors in a move aimed at improving the country’s investment climate.

Under the revised procedure, companies will no longer need to obtain prior security clearance for foreign directors at the time of submitting a licensing application. Instead, applications will be processed based on affidavits provided by the directors, helping reduce delays and speed up approvals.

However, the appointment of foreign directors will still require mandatory security clearance from the relevant authorities. If clearance is later denied, the company will be required to replace the concerned director.

The SECP said the reform is designed to enhance ease of doing business by cutting down processing time, particularly for sectors such as capital markets, non-banking finance, insurance, and other financial services.

Officials noted that security clearance delays had long been a key bottleneck for investors seeking market entry in Pakistan.

SECP Chairman Kabir Sadhu said the new approach balances investor facilitation with regulatory and security requirements.

He added that while the process has been streamlined, full compliance with national laws will continue to be strictly enforced.