SECP mandates book-entry shares for unlisted firms

February 28, 2026 (MLN): Securities and Exchange Commission of Pakistan has made it mandatory for unlisted companies to convert their physical shares into book-entry form, requiring them to shift to the Central Depository System before undertaking future share-related transactions.

The requirement applies to companies planning transfer of shares, issuance of bonus shares, issuance of right shares or shares other than by way of rights, and buy-back of shares, according to the press release.

The move formalizes the transition of unlisted companies from paper-based share certificates to electronic records maintained in the CDS.

To facilitate the transition, the Central Depository Company has introduced a one-year fee relief package for existing unlisted companies converting their physical shares into book-entry form.

Under the package, companies with paid-up capital of up to Rs25m will have their annual fee waived for the first year.

The security deposit fee, initial conversion deposit, and security deposit processing fee will be waived for all unlisted companies during the same period.

Unlisted companies with paid-up capital exceeding Rs25m will be required to pay only the applicable annual fee, while security deposit and conversion-related charges will remain waived for the first year.

The relief will also apply to unlisted companies that voluntarily convert their physical shares into book-entry form.

The measure aims to facilitate the transition of unlisted companies to the CDS, reduce the cost of conversion, and support a paperless shareholding environment.

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