Pakistan FDI control

The following Competition practice note provides comprehensive and up to date legal information covering:

  • Pakistan FDI control
  • 1. What is the applicable legislation?
  • 2. Which government or other body (or bodies) reviews foreign investments?
  • 3. What is the scope of the foreign investment regime? Does it only apply to specific sectors or types of investors (e.g. foreign or non-EU/non-WTO)? Are there specific rules for certain types of investors (e.g. state-owned enterprises)?
  • 4. What are the triggers or thresholds for the regime to apply? What types of transactions are caught? Is there a minimum level of shareholding or a control test that applies? Are there any other thresholds that need to be met (e.g. based on turnover or market shares)?
  • 5. Are there any exceptions that may apply?
  • 6. Is there any discretion to review transactions that do not meet any thresholds for review?
  • 7. What are the grounds for review, e.g. public or national security or other grounds?
  • 8. What level of discretion do the relevant authorities have to approve or reject transactions? Is there scope for any other body to intervene?
  • 9. Where a transaction is caught by the regime, is notification mandatory and must closing be suspended pending clearance?
  • More...

Pakistan FDI control

A conversation with Mr. Sarjeel Mowahid, Partner, Mr. Anas Farooq, Associate & Mr. Muhammad Areeb of ABS & CO on key issues on FDI control in Pakistan.

1. What is the applicable legislation?

Pakistan is a federation whereby certain subjects are devolved to the competence of the provinces, while others are retained under the legislative competence of the federal government. As of passing of the 18th Amendment of the Constitution of 1973, there is a federal legislative list which covers the subjects on which the federal government is competent to legislate, while other subjects shall be legislated upon by the provinces. It may be noted that the scope of the article is limited to the overall investment regime applicable to foreign investors, with a primary focus on federal legislation. Sectoral and provincial laws may be applicable in addition to the laws mentioned below, and it is pivotal that professional advice is sought with regards to the nature of the investment being made. Regardless, the main laws are as follows:

  1. Foreign Exchange Regulation Act 1947 (FERA);

    The purpose of the Act is to regulate payments and dealings in foreign exchange and securities and the import and export of currency and bullion. The Act imposes certain restrictions on dealing in foreign exchange which are subject to general and special exemptions from the State Bank of Pakistan (SBP).

Related documents:

Popular documents