Govt to draft new licensing policy for bilateral business chambers

October 08, 2025 (MLN): The government is preparing a new licensing policy to regulate bilateral business chambers to ensure transparency, credibility and stronger reciprocal trade partnerships with foreign countries.

The Ministry of Commerce, in collaboration with the Directorate General of Trade Organisations (DGTO), is developing a proposed framework, which sets out enhanced eligibility, financial, and governance criteria for chambers seeking official recognition, as reported by APP.

Wealth Pakistan reported that each bilateral chamber would be required to maintain at least 50 active members from Pakistan and as many from the partner country.

The membership must include a balanced mix of corporate organisations and small and medium enterprises (SMEs), ensuring broad-based representation.

The Ministry’s Foreign Trade Wing may, however, allow flexibility in the foreign membership threshold on a case-to-case basis for countries with significant economic interest in Pakistan but limited chamber infrastructure.

The new framework mandates balanced representation of both Pakistani and foreign nationals on the executive committee, with the chairmanship or presidency alternating between the two sides.

This rotating leadership structure has been described in the draft as the best practice to promote fairness and equal participation.

Furthermore, each chamber must sign a legally binding Memorandum of Understanding (MoU) with a recognised counterpart in the partner country.

In cases where a formal MoU cannot be obtained, written confirmation from the relevant foreign ministry or competent authority will be accepted.

Financial credibility and sustainability are key features of the proposed reforms. Tier-I chambers will be required to maintain a minimum reserve fund of Rs10 million, while Tier-II and Tier-III chambers must have at least Rs5m.

All chambers would be obligated to submit a sustainable business plan and audited financial statements.

Licences would be issued for a three-year period, with renewal based on performance indicators such as investment facilitation, business promotion activities, and member support outcomes.

The proposal introduces a robust verification system to prevent misuse of bilateral status.

Applications will be transmitted by the DGTO to Pakistan’s foreign missions abroad for embassy-based verification within 21 working days.

The trade and investment officers posted in the relevant missions would confirm the legal status, reputation, and credibility of the foreign counterpart organisation.

At the same time, the partner country’s embassy in Pakistan will be approached to verify the legitimacy and good standing of the proposed member enterprises.

Legal provisions under the draft stipulate that any dispute between a chamber and the regulator (DGTO) would be adjudicated exclusively under Pakistani law, in accordance with Section 21 of the Trade Organisations Act, 2013.

This clause reinforces Pakistan’s regulatory authority over all licensed trade organisations operating within its jurisdiction.

A senior official from the Ministry of Commerce told Wealth Pakistan that the new policy intended to professionalise bilateral chambers, replacing ad-hoc registration with measurable standards of performance and accountability.

He said the reforms were expected to curb the rise of inactive or one-sided associations and strengthen the credibility of Pakistan’s trade diplomacy.

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