ISLAMABAD, October 31, 2026: In a sweeping regulatory action, the Securities and Exchange Commission of Pakistan (SECP) has officially designated 39,704 companies as “Inactive by Registrar” following their failure to file mandatory annual returns and financial statements for four consecutive years.
The mass deactivation aims to enhance the reliability of the national corporate register and prevent the potential misuse of dormant entities. The inactive status has been updated across the SECP’s digital systems and is now visible to all banks and financial stakeholders.
Consequently, the defaulting companies are barred from opening new bank accounts, accessing financial services, or registering any changes to their board of directors. Furthermore, existing bank accounts belonging to these companies will be frozen until their outstanding filings are complete. The regulatory restrictions will only be lifted once the overdue documents are submitted and active status is formally restored.
Geographic Distribution of Inactive Companies
A geographic breakdown of the regulatory action reveals that the bulk of the non-compliant companies are concentrated in Pakistan’s major urban economic centres. Lahore tops the list with 13,927 inactive companies, closely followed by Islamabad with 13,859. Karachi accounts for 4,868 inactive entities, while Peshawar and Multan recorded 2,031 and 1,861 respectively. Other affected cities include Faisalabad (1,384), Gilgit (1,102), Quetta (436), and Sukkur (236).
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AML Compliance and System Integrity
The crackdown is part of a broader effort to enforce the Companies Act, 2017, which legally mandates the filing of annual returns and financial statements to maintain transparent, up-to-date records of corporate ownership and management. The SECP warned that prolonged non-filing compromises the credibility of the corporate register and obstructs national efforts to combat money laundering and terrorist financing.
SECP Chairman Dr Kabir Ahmed Sidhu, who assumed office earlier this year, emphasised the necessity of the cleanup. Dr Sidhu stated that a clean and credible registry forms the foundation of trust within the corporate sector. He noted that the commission is actively protecting the integrity of the financial system while giving these companies a clear pathway to return to regulatory compliance.
Corporate Sector Continues Rapid Expansion
Despite the purge of dormant entities, Pakistan’s formal corporate sector continues to expand. As of the end of September 2026, the SECP’s active register contained 317,002 companies.
During the previous financial year, the commission registered 43,559 new companies, marking a 24 per cent year-on-year growth. This growth has been heavily supported by rapid digital transformation; name reservation and incorporation processes are now fully digitized, with 99.9 per cent of all new companies being registered online.