Circular No. 5 of 2024 – Term of the office of Independent Director under sub section (2)(g) of Section 166 of the Companies Act, 2017

The Securities and Exchange Commission of Pakistan clarifies that a director filling a casual vacancy for the remainder of a term is considered appointed for a complete term. This interpretation applies to the calculation of the maximum three consecutive terms allowed for independent directors under Section 166(2)(g) of the Companies Act, 2017. All non-compliant companies must adhere to this requirement and report their compliance to the Commission within sixty days of the circular's issuance.

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SECURITIES AND EXCHANGE COMMISSION OF PAKISTAN Licensing and Registration Division Licensing Department * No. CD/CD/PR(II)/2017 Islamabad, February 19, 2024

CIRCULAR NO. 05 OF 2024

SUBJECT: TERM OF THE OFFICE OF INDEPENDENT DIRECTOR UNDER SUB SECTION (2)(g) OF SECTION 166 OF THE COMPANIES ACT, 2017.

In exercise of powers conferred by section 510 of the Companies Act, 2017 (“the Act”), the Securities and Exchange Commission of Pakistan (“the Commission”) is hereby pleased to clarify the word “term” used in section 166(2)(g) of the Act.

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Lineage: In force

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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