Service overview
A Section 42 company is incorporated after SECP licenses the proposed not-for-profit association.
The correct legal form determines membership, liability, governance, statutory filings and whether separate sector licences will be needed.
Who can establish a Section 42 company?
Three or more promoters must demonstrate qualifying objects and a non-distribution approach to income under section 42 and current regulations.
SECP must first issue the Section 42 licence for the proposed permitted objects. Three or more promoters, non-distribution of profits, and continuing governance undertakings should be in place before incorporation.
Documents and information for Section 42 Not-for-Profit Incorporation
Prepare the following information for section 42 not-for-profit incorporation. The relevant regulator may require further forms or certified evidence, depending on the applicant and chosen procedure.
- Charitable or qualifying objects
- Promoters and declarations
- Proposed memorandum and articles
- Governance arrangements
- Source-of-funds and planning records.
How do I incorporate a Section 42 not-for-profit company in Pakistan?
- 01Obtain the Section 42 licence before incorporation
The promoters must first establish non-profit objects and non-distribution restrictions and prepare the Section 42 licensing application.
- 02Use the SECP licensing checklist
Submit the relevant App-3/other currently required form, proposed memorandum and articles, promoter particulars and supporting governance or financial documents under regulations 4–5.
- 03Incorporate after licence issuance
Complete SECP company name reservation and incorporation in the licensed not-for-profit category, adhering to the approved objects.
- 04Preserve licence conditions
Implement non-distribution, fundraising, governance and accounts obligations in addition to ordinary corporate filings.
Regulator resource: SECP Section 42 licence must precede incorporation
After registration or approval
Apply income and property to approved objects; satisfy Section 42 governance, accounts and reporting conditions.
Governing law & official references
Section 42 of the Companies Act, 2017 and regulations 4–5 of the Companies Regulations, 2024. SECP licensing precedes incorporation.
The links below lead to government or official regulatory sources relevant to this service. Use the currently consolidated Act, regulations, statutory checklist and official portal when making an application.
How Chambers can assist
Chambers can review the legal route, identify regulatory constraints, prepare or review the supporting corporate and legal documents, manage the prescribed submission and correspond with the competent authority where instructed. The scope of the engagement will be determined by the applicant’s particular circumstances.
For an initial enquiry, identify the proposed activity, applicant entity and current stage, and provide the available documents indicated above. Please avoid sending confidential or identity-sensitive records through an unencrypted first contact.
Common questions about Section 42 Not-for-Profit Incorporation
Who is eligible for Section 42 Not-for-Profit Incorporation in Pakistan?
Three or more promoters must demonstrate qualifying objects and a non-distribution approach to income under section 42 and current regulations.
What documents are needed for Section 42 Not-for-Profit Incorporation?
Charitable or qualifying objects; Promoters and declarations; Proposed memorandum and articles; Governance arrangements. Additional requirements can apply to the actual business or regulator.
How do I incorporate a Section 42 not-for-profit company in Pakistan?
Obtain the Section 42 licence before incorporation: The promoters must first establish non-profit objects and non-distribution restrictions and prepare the Section 42 licensing application. Use the SECP licensing checklist: Submit the relevant App-3/other currently required form, proposed memorandum and articles, promoter particulars and supporting governance or financial documents under regulations 4–5. Incorporate after licence issuance: Complete SECP company name reservation and incorporation in the licensed not-for-profit category, adhering to the approved objects. Preserve licence conditions: Implement non-distribution, fundraising, governance and accounts obligations in addition to ordinary corporate filings.
This guide is general information, not advice on your facts. Check the applicable law, notifications, updated regulator checklists and jurisdiction before acting. The authority alone determines eligibility, acceptance and approval; no outcome or processing period is guaranteed.