Three or more than three person desirous to form a company to offer shares to general public may form a public company. Although a public company has to fulfill much legal formalities but a public company can offer its share to general public. Minimum three directors are required to form unlisted company, an unlisted company can offer shares to general public on its counter, but shares cannot be traded in stock market. Minimum seven directors are required to form listed company, a listed company can offer shares to general public and shares can be traded in stock market.
Public Company with Foreign Director
Foreign national or foreign company desirous to invest in Pakistan can also become part of a public company, instead of registering as a foreign company . Collaboration with a foreign company enhances the local investors’ confidence on the company. Incorporation cost and time of registration being a Pakistani public company is much lesser than registering as a foreign company. Further all advantages of public companies can be obtained by the foreign investors by this way.
Liaison Office and Branch Office (Foreign Company)
Foreign Companies which are planning to do business in Pakistan but not willing to get registered as a company, may opt to establish a liaison office or branch office. Branch Office is established by a foreign company to fulfill its contractual obligations with the public or private sector in Pakistan. Their activity will be restricted to the work mentioned in the agreement / contract signed. However branch office cannot indulge in commercial / trading activities. Liaison Office is established by a foreign company for promotion of products(s), provision of technical advice & assistance, exploring the possibility of Joint Collaboration and export promotion.
Foreign Company / Foreign Direct Investment
A foreign company may establish its locally incorporated subsidiary with 100% equity. A foreign company can indulge in all activities , there are only few areas, relating to national security, in which a foreign company cannot make investment.