A foreign investor establishing a presence in Pakistan generally chooses between incorporating a locally registered company, or establishing a branch or liaison office, each with a different regulatory and approval sequence.
Locally incorporated company
A company incorporated in Pakistan with foreign shareholding is registered with SECP in the same manner as a domestic company, subject to any sector-specific conditions on the level of permitted foreign ownership.
Branch and liaison offices
A branch office, generally used to conduct business activity directly, requires permission from the Board of Investment. A liaison office is typically restricted to representative and coordination functions and cannot engage in commercial trading activity.
The practical sequence
- Confirm the sector-specific investment policy applicable to the intended business
- Choose the entry structure appropriate to the intended activity
- Obtain Board of Investment permission, where the structure requires it
- Complete SECP incorporation or registration
- Register with FBR for tax purposes and complete any State Bank reporting for the inbound investment
What to do next
Confirm the sector and intended activity first, since this determines which entry structure is actually available and what approvals it requires.