Brief Introduction:
Any economic activity carried on for the purpose of profit is called business.
Business involves the exchange of goods services or money for the purpose of earning a profit.
Business can be conducted in different forms like Individual Partnership Company.
It can take place at various levels including small local businesses large multinational corporations and everything in between.
The primary goal of business is to generate revenue and profits through the sale of goods or services to consumers or other businesses.
Business Registration:
- Business registration is the process of formally establishing a business and obtaining the necessary licenses and permits to operate legally.
- The process of business registration varies depending on the type of business the location where it will operate and the laws and regulations that apply to it.
- First thing in the process of business registration is to choose the appropriate business structure.
- Every business structure has its own pros and cons so you need to choose carefully structure of the business depending upon your business requirements.
- Following are most common structures of the business registered in the Pakistan
Sole Proprietorship:
- A sole proprietorship is a type of business structure in which an individual owns and operates a business on their own. In Pakistan a sole proprietorship is relatively easy to set up and it is the most common type of business structure particularly for small business. It is important to note that as a sole proprietor in Pakistan you will be personally responsible for all debts and obligations of the business. This means that if the business is unable to pay its debts your personal assets may be at risk. It is advisable to seek legal advice before setting up a sole proprietorship in Pakistan.
- To set up a sole proprietorship business you need to follow the following steps.
- Choose a unique name
- Choose a relevant business category
- Obtain the NTN of your business from FBR
- Any other registration from the relevant authority depending upon your business need.
Partnership:
A partnership is a business structure in which two or more individuals or entities come together to operate a business. In a partnership the partners contribute capital labor and other resources to the business and they share in the profits and losses of the business according to the terms of the partnership agreement.
To set up a sole proprietorship business you need to follow the following steps:
- Choose a unique name
- Choose a relevant business category
- Choose the partners
- Draft a brief partnership contract detailing each every terms and condition of partnership like Name Place of business Capital Profit/loss sharing ratio dissolution and arbitration and so on
- Approach the relevant authority like FBR Registrar of the firms or SECP.
- Following are the variation of partnership depending upon its registration.
An association of persons (AOP) is a group of individuals who come together for a common purpose such as a business venture or a charitable organization.
Income earned by an AOP is generally taxed at the individual level rather than at the corporate level.
After following the above steps if want to register your partnership business as AOP you need to approach the FBR with all the partners NTN and partnership contract for registration of your AOP.
A firm is just the like an AOP but the registered one with registrar of the firms. For firm registration after following all the necessary steps you will have to additionally register your partnership contract with the registrar of the firms who after fulfilling all the necessary requirements will issue you a Form C as a proof of registration.
Further you will need approach the FBR for issuance of NTN of your Registered Firm.
Limited liability partnership
Limited Liability Partnership is a new business form in Pakistan initiated by SECP (Securities Exchange Commission of Pakistan). The purpose for Starting this business structure was to minimize the gap between sole proprietorships and partnerships which are mostly unregistered and limited liability companies.
LLP is a partnership form in which some or all partners have limited liability. In an LLP every partner is not liable for another partners conduct. This is a vital difference from the traditional partnership and a LLP.
For registration of LLP after following the above said steps you need approach the SECP for LLP registration.
A company is a legal entity that is separate and distinct from its owners and shareholders.
A company is formed by registering with the Securities and Exchange Commission of Pakistan (SECP) a government agency responsible for regulating the formation and operation of companies in Pakistan under the companies act 2017.
There are several types of companies that can be formed in Pakistan including
Public limited companies
Private limited companies
Single member companies
Pharmaceutical company Registration
IT Company Registration
A branch office is a business location that is separate from the main office or headquarters of a company. Branch offices are typically established in order to expand a companys reach and serve a specific market or geographic area.
Branch Office is established by a foreign company to fulfill its contractual obligations with the public or private sector in Pakistan.
For registration it requires permission/registration form Board of investment and SECP and FBR
A liaison office is a type of business presence that a company establishes in a foreign country in order to represent the companys interests and facilitate communication with local business partners and customers. A liaison office is not a separate legal entity and does not have the authority to engage in commercial activities or generate income in the host country. Instead it serves as a channel of communication between the parent company and the local market.
Mainly Board of investment and SECP are involved in the opening of liaison office in Pakistan.