How to get a trading license in Pakistan (2023)?

Are you enthusiastic about starting your business in Pakistan and getting a trading license? The truth is that you may face a lot of hiccups in the start if you do not get organized. What we intend to do is make things easy for you.

The first step is to acquire a trading license so that you can start your business. The good news is that it is not an impossible endeavor at all. We will give you a basic guideline so that it becomes easy for you to acquire the license.

Now, the first question to answer is what is trading license.

Understanding the concept of trading license

When you want to commence your business in a certain area or location, then you need permission for this. The best thing about a trading license is that it helps you get permission to start your trade or business.

Business registration types and documents required for a trading license

Registering as a sole proprietor

There are three departments that hold immense significance when you want to get a trading license.

• Federal Board of Revenue
• Securities Exchange Commission of Pakistan
• Chamber of Commerce

Federal Board of Revenue maintains the taxation details of a business. If you intend to start import and export trade, then you must register with the Chamber of Commerce also. Once you acquire the registration certificate from FBR and the Chamber of Commerce, then you can trade as the sole proprietor.

Registering business on partnership ( AOP registration)

Now,  you will need a trading license if you plan to do business on partnership. To start a business on partnership in Pakistan, you need a minimum of two partners. You need AOP Registration in this scenario. AOP stands for Association of Persons.

For AOP Registration:

• All the terms and conditions of the business get mentioned on the deed.
• The deed has the name of the company also.
• The deed needs to have the signature of both the business partners.
• Plus, the deed needs to have the signature of two witnesses also.
• After completion of this process, you need to register the deed in the Chamber of Commerce.
• Once you register with the Chamber of Commerce, you get Form C. Well, Form C is basically the AOP registration certificate.

At this point, NTN gets created for both the business partners. A separate NTN gets created for the company also. These are the few essential steps for acquiring a trading license in Pakistan.

Additional Requirements for a trading license

• If you want to start a food business, then additionally, you need to get a license from the food authority in Pakistan.
• If you want to start a medical-related business, then a certificate from the medical authority will also be a requirement.

Now here you need to keep two things in mind. Sole proprietor applies to individual businesses only. We will refer to AOP registration as firm. Both registrations do not fall into the category of a company. Well, a company can get created through the company act. The company act gets incorporated through the SECP.

Limitations of Sole Proprietor and AOP

When you solely have FBR and Ecommerce registration, then you cannot start the following businesses

• Travel
• Banking

Now, let us move to SECP registration and see how it offers value.

What you must keep in mind is that every business gets registered with SECP. SECP allows company registration. SECP registration requires that a company must have two directors.  Now, if you want to register as a company, then you will require the registration of all the three departments that is FBR, Chamber of Commerce and SECP.  For Sole Proprietor or AOP registration, you will need the approval of two departments that is FBR and Chamber of Commerce.

We will guide you through the SECP registration process so that you can get a trading license with ease.

How to register as a Private Limited Company in SECP?

• Visit the SECP site and go through all the necessary guidelines
• If you want to check the name availability for your company, visit the links section, click on name availability search and enter your name to find out if a company exists by the mentioned name
• When you visit the SECP website,  you will see Signup for National option
• A form will open on the page and it will require you to enter your personal information. If you face any issue in filling the form, registration guide link is available to get the necessary help.
• Once you submit the form, you can login with your NIC on the portal. A form will open on page and you have to click on the Company Name reservation option to reserve the name of your company
• Next, the company name reservation form will open on page and you have to enter all your company information here. After entering all the information, you can submit the form

The registration fees for SECP can be made online through the site. After you make the payment, you will receive an email in 24 hours informing you whether your company name got accepted or rejected. What you need to keep in mind is that company name will only be available for 60 days. You will have to complete the remaining process within the 60-day period.

• Now, you will login into SECP website again, click on Login next to your company name
• Click on Company Incorporation. You must fill in the company incorporation form. Now here you may need to fill some documents. The rest you will need to review and save.

This how you need to go about when you want to get a trading license in Pakistan. The best approach is to assess your requirements first. If you have any confusion regarding the requirements, then you may seek legal advice too so that you can manage the processes with ease.  Conduct research also on your part so that your startup does not get delayed due to lack of information.

Make sure that you follow the mentioned guidelines to get a trading license.