Overview of Legal Entities in Pakistan
|Type of Entity||Minimum No. of Shareholders||Minimum Capital Requirement||Standard Time of Incorporation|
|Private Limited Company||2||PKR 100,000(~USD 823)||6 weeks|
|Single Member Company||1||PKR 100,000(~USD 823)||4 weeks|
|Public Listed Company (Listed)||3||200 million(~USD 1.6M)||6 weeks|
|Public Listed Company (Unlisted)||3||PKR 100,000(~USD 823)||6 weeks|
|Branch Office||No shareholders||N/A||7 weeks|
|Liaison Office/Representative Office||No shareholders||N/A||7 weeks|
Allowed Foreign Ownership in Pakistan
Unlike many other similar markets, Pakistan is very welcoming towards foreign investors. Due to negative international reputation, the country has significantly opened up to foreign investment over the past years.
For example, you can even import some products without acquiring an import license.
Moreover, foreign investors can set up 100% foreign-owned companies in most business lines. The shareholders can be of any nationality, except for Israeli nationals.
Minimum Capital Requirement in Pakistan
There are two types of share capitals in Pakistan, paid-up capital and authorized capital. Both capitals must be declared in the Articles of Association when you register your company.
Paid up capital is the amount of money that the company receives from its shareholders. On the other hand, authorized capital is the maximum amount of share capital that the company is allowed to authorize to issue to its shareholders.
There is no official minimum capital requirement for private limited companies in Pakistan. For this reason, a common practice is to consider PKR 100,000 (~US$823) as the minimum capital.
In reality, however, the paid up capital you inject must be in compliance with your planned expenses. For example, if you plan on building a factory for your business, you must also have sufficient capital for that.