RegAlert2025-10-23
Added · Updated
Circular No.14 of 2025 – Non-Executive Directors nominated by AMCs on board of brokerage subsidiary
Asset Management Companies are permitted to nominate employees as non-executive directors on the board of a brokerage subsidiary, provided they obtain prior approval for the subsidiary's corporate structure and board composition from the Securities and Exchange Commission of Pakistan. The subsidiary must maintain at least one-third independent directors, prohibit proprietary trading, and implement strict Chinese Wall policies, segregation of front and back office systems, and best execution protocols. Nominated employees are restricted to receiving only board meeting fees, while Investment Committee members are ineligible for directorship, and the subsidiary's CEO, research heads, and traders must remain independent of the AMC. Additionally, brokerage commissions cannot exceed the minimum prescribed by the Pakistan Stock Exchange, and both entities must conduct special monitoring with quarterly reporting to their respective boards.
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SECURITIES AND EXCHANGE COMMISSION OF PAKISTAN
SPECIALIZED COMPANIES DIVISION
FUND MANAGEMENT DEPARTMENT
No. SCD/CIRCULAR/ 316 /2025 June 11, 2025
Circular No. 14 of 2025
Subject: Requirements Applicable to Non-Executive Directors Nominated by an Asset Management Company on the Board of a Brokerage Subsidiary
The Securities and Exchange Commission of Pakistan (“the Commission”) in exercise of the powers conferred under section 282B(3) of the Companies Ordinance, 1984 read with Regulation 37(4)(c) and Regulation 67A of the Non-Banking Finance Companies and Notified Entities Regulations, 2008 (the “Regulations”) hereby allows an Asset Management Company (AMC) to nominate its employees as non-executive directors on board of a brokerage subsidiary subject to compliance with following requirements:
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Source: Securities and Exchange Commission of Pakistan — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works
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SECP published 3 documents in the last 30 days. We email you each new one the day it's published.