Regulatory Alerts2021-05-26
Added · Updated
SRO 581(I)/2021 - Amendments to NBFC & Notified Entities Regulations, 2008
The Securities and Exchange Commission of Pakistan amends Regulation 38 to require Non-Banking Finance Companies to implement a board-approved policy ensuring sales forces document product suitability based on investor risk tolerance, with internal audits and quarterly reporting to management committees. The amendments to Schedule IX introduce a proviso allowing the Commission to relax fit and proper criteria for non-executive nominee directors representing institutional interests on a case-by-case basis. Additionally, the regulations now mandate that individuals subject to fit and proper criteria provide an affidavit confirming no Law Enforcement Agency investigations are pending, requiring boards to formally decide on retaining CEOs or directors if such investigations occur. The Commission is also authorized to interview chief executives to assess suitability if it finds the submitted criteria insufficient, while sub-clause (viii) of Schedule IX is omitted.