SECP Easy Exit Scheme: Simplifying Company Closures

 

SECP EASY EXIT SCHEME

In the dynamic landscape of business, companies often face the need to wind down their operations. Whether due to strategic shifts, financial challenges, or other reasons, a streamlined process for closing a company is essential. The Securities & Exchange Commission of Pakistan (SECP) recognizes this need and has introduced the Easy Exit Scheme to facilitate the efficient closure of private and public unlisted companies. In this blog post, we’ll explore the scheme’s features, eligibility criteria, and benefits.

1. Understanding the Easy Exit Scheme (CEES)

The Company Easy Exit Scheme (CEES) provides a straightforward route for companies to strike their names off the register of companies. Here’s what you need to know:

a. Eligibility Criteria

  • Eligible Entities: Private and public unlisted companies, including associations not for profit, licensed under section 42 of the Companies Ordinance, 1984, can apply for striking off their names under the CEES.
  • Exceptions: Certain entities are excluded from the scheme:
    • Subsidiaries of listed companies
    • Foreign companies
    • Trade organizations licensed under the Trade Organization Act, 2013
    • Companies with outstanding liabilities (loans, taxes, utility charges)
    • Companies facing investigations, legal disputes, or court proceedings
    • Companies involved in illegal or fraudulent activities
    • Housing and real estate development companies
    • Companies soliciting public deposits

b. Application Process

To initiate the exit process, companies must submit the following documents/forms to the concerned registrar of companies:

  • Application for striking off Company’s name (Form EE-I)
  • Members’ Resolution (Form EE-II)
  • Declaration/Indemnity (Form EE-III)
  • Auditors’ Certificate (Form EE-IV)

c. Application Fee

The fee for applying under the CEES depends on the submission method:

  • Online Submission: PKR 5,000/-
  • Manual Submission: PKR 10,000/-

Please note that the electronic submission fee applies only to documents eligible for online filing1.

2. Benefits of CEES for Companies

The CEES offers several advantages to businesses:

a. Time Efficiency

  • Eliminating manual paperwork saves valuable time during the filing process.

b. Cost Savings

  • Reduced printing, postage, and administrative costs make compliance more affordable.

c. Accessibility

  • Companies can manage filings 24/7 from anywhere with an internet connection.

d. Enhanced Compliance

  • The automated checks in the eZfile system ensure accurate submissions, minimizing the risk of penalties.

3. Conclusion

The CEES, along with the user-friendly eZfile platform, marks a significant leap forward in digital filing for Pakistani businesses. As of February 15, 20242, companies can embrace efficiency, transparency, and compliance. So, if you’re considering closing your company, explore the CEES and experience the future of corporate governance. Remember, it’s not just an exit—it’s a strategic move toward progress13.


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