SECP Cuts Timelines for Bonus and Right Issues
The Securities and Exchange Commission of Pakistan (SECP) has slashed the completion period for bonus issues to 11 days and right issues to 53 days, a major step toward faster shareholder access and market efficiency.
ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has approved sweeping amendments to the Companies (Further Issue of Shares) Regulations, 2020, reducing the timelines for bonus and right issues by as much as 87% to accelerate shareholder value delivery.
Previously, bonus issues could take up to 85 days, while right issues stretched to as long as 181 days before shares were credited to investors’ accounts. Under the revised framework, which will take effect on October 1, 2025, the process has been streamlined significantly, bringing bonus issues down to just 11 days and right issues to 53 days.
According to the SECP, the reforms aim to create a more agile capital market environment, ensuring that shareholders can access their entitlements more quickly and capitalize on trading opportunities without lengthy delays.
The regulatory body noted that the amendments were finalized after an extensive consultation process with key stakeholders, including the Pakistan Stock Exchange (PSX), Central Depository Company (CDC), National Clearing Company of Pakistan Limited (NCCPL), leading consultants, legal professionals, and financial experts. A consultation paper was first issued to invite market feedback, followed by in-person and virtual engagements. A draft of the amendments was later circulated before final approval, with all stakeholder recommendations thoroughly evaluated.
Among the notable changes are a shorter period for the notice of book closure, the introduction of a single-day book closure facilitated by technological advancements at capital market institutions, faster submission and clearance of offer documents, quicker credit of Letters of Right, and expedited allotment of right and bonus shares.
The SECP emphasized that the streamlined process will not only benefit shareholders but also enhance the operational efficiency of market institutions and companies issuing shares. The regulator expects these reforms to align Pakistan’s capital markets more closely with international standards, making them more attractive to domestic and foreign investors alike.
Beyond bonus and right issues, the SECP is also exploring additional measures to foster a more investor-friendly environment. Ongoing consultations with stakeholders are examining options to reduce the time required for dividend payments and to address investor concerns related to Roshan Digital Accounts (RDA). Specifically, the regulator is considering improvements to the process of opening RDA accounts with multiple brokerage houses and simplifying fund transfers between accounts held by the same investor.SECP launches Capital Market Development Fund
Market experts have welcomed the amendments, noting that quicker issuance processes will improve market liquidity, reduce uncertainty for investors, and enhance confidence in Pakistan’s regulatory framework. Analysts also believe that aligning with global best practices is crucial as Pakistan seeks to attract more foreign portfolio investment and strengthen its capital market infrastructure.
The SECP said that these reforms represent part of its broader strategy to modernize Pakistan’s financial markets through digital integration, regulatory efficiency, and greater transparency. For shareholders, the immediate impact will be faster access to bonus and right shares, enabling earlier participation in secondary market trading and improved capital mobility.
With the amendments now scheduled to take effect in October, market participants expect the changes to reshape issuance processes, reduce administrative bottlenecks, and set a precedent for further modernization of Pakistan’s financial sector.
