SECP proposes new law to unlock funding for start-ups

ISLAMABAD, Aug 24 (APP):The Securities and Exchange Commission of Pakistan (SECP) has shared the draft Venture Capital (VC) Bill with the Board of Investment (BOI) for public consultation.

The proposed law aims to increase access to risk capital, attract domestic and foreign investment, support start-up growth, create jobs and contribute to economic growth.

The Bill has been prepared under a Federal Government initiative that tasked SECP to develop a bespoke, standalone regulatory framework for venture capital and improve funding access for start-ups and high-growth businesses, said a release issued here on Monday.

Despite strong potential, Pakistan’s start-up, technology and innovation sectors have limited access to formal venture capital, with much of the investment activity structured offshore or outside the domestic regulatory framework.

The proposed Bill seeks to address this gap through a simple and transparent framework for venture capital funds and fund managers. It provides for light-touch licensing and registration, simplified operational structures, and clear governance and reporting standards, while facilitating the formalization of venture capital activity in Pakistan.

Chairman SECP Dr Kabir Ahmed Sidhu said the proposed law would help channel private capital into Pakistan’s emerging businesses. “The Bill recognizes the high-risk and innovation-driven nature of venture capital and seeks to reduce regulatory barriers while ensuring effective governance and investor protection.”

As the next step, SECP and BOI will hold public consultations with key stakeholders, including start-ups, fund managers, legal and financial experts, the State Bank of Pakistan, Pakistan Stock Exchange and relevant industry associations, before the draft proceeds through the legislative process.