SECP proposes accreditation framework for insolvency professionals

According to Profit by Pakistan Today, the Securities and Exchange Commission of Pakistan (SECP) is asking for public feedback on a draft accreditation scheme covering official liquidators, provisional managers and insolvency specialists. The draft seeks to improve how companies are wound up and how financially distressed businesses are rehabilitated under the Companies Act, 2017 and the Corporate Rehabilitation Act, 2018. The aim is a pool of qualified professionals who can manage liquidations and support the recovery of troubled firms.

Under the proposal, practitioners applying for empanelment, together with those already listed by the Commission, would have to earn insolvency practice certification from the Institute of Financial Markets of Pakistan (IFMP). The programme would be delivered in three stages, including written and oral examinations, followed by annual continuing professional development requirements. A conduct code would also bind official liquidators and provisional managers, with the latter taking a temporary role in proceedings.

The proposal aims to close capacity shortfalls highlighted in a 2022 World Bank assessment of standards and codes, and it draws on practices in the UK, Singapore, Malaysia and India. Expected outcomes include more efficient and transparent proceedings, stronger protection for creditors and a better chance for viable companies to recover.