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25 September 2025
Author: Asif S Kasbati (FCA, FCMA & LLB)
A. SHARIAH COMPLIANT& INSTITUTIONAL INVESTORS AND KASBATI VIEWS & RECOMMENDATIONS
1. We appreciate SECP for publishing such Direction no. 26 of 2025 Shariah-Compliant Institutional Investors, which is also important for Islamization of economy in Pakistan as per Federal Shariat Court (FSC) order (BFIC 322 of 7.9.25 refers)
2. We recommend moving toward Shariah Compliant Finance as the same is being implemented in phase by manner and finally by 31.12.27 full economy will be Shariah Compliant as per FSC order & Constitution. Hence we request your Goodself action to multiply their BFIC for Here & Hereafter.
B. BACKGROUND - as to Important Shariah Compliant Finance matters
1. This refer to BFIC 322 of 7.9.25 about Summary of Shariat Court Decision against Interest & Insurance - Implementation Deadlines and related Booklet with proper content (Attachment 329.1)
2. This refers to the related QCs in trial, blue, italic and double Line (a) BFIC 323 of 9.9.25 about PSX & CDC Enhancing Shariah-Compliant Market Services - SECP (b) BFIC 313 of 21.5.25 about Promoting Shariah-Compliant Intermediaries Consultation Paper
3. We also refer to several Other BFQCs including (a) BFQC 172 of 18.12.22 about Govt decision & SBP withdrawn Appeal against FSC order(b) BFQC 152 of 28.6.22 about Petitions against RIBA? and Recommended Actions (c) CoQC 278 of 6.11.18 about Shariah Governance Regulations & related tax matters vide SRO 1318
C. INSTITUTIONAL INVESTORS IN 3 PHASES
1. Further to KQU 3537 of 2.9.25, being an Important matter, we would inform you about Direction no. 26 of 2025 Shariah-Compliant Institutional Investors (Attachment 329.2) in the ensuing paragraph, in Italic with emphasis in bold & Underline, heading ours for quick reading.
2. In exercise of the powers conferred by section 40B of the SECP Act, 1997, read with clause (x) of subsection (4) of section 20 thereof, the SECP hereby directs the Shariah Compliant Institutional investors (Takaful Operators, Window Takaful Operators, Non-Bank Finance Companies, Collective Investment Schemes, Voluntary Pension Schemes, Modarabas, Modaraba Management Companies, Private Funds and Securities Brokers) to progressively route their business through Shariah-compliant securities brokers in a phased manner as follows:
3. Phase I: Up to 30.6.26
(a) Formulate an internal policy by 31.12.25 to determine the portion of securities trading business to be routed through Shariah-compliant securities broker(s), and commence implementation in accordance with the approved policy.
(b) Commence quarterly reporting to the Commission from 31.3.26, indicating the percentage of business routed through Shariah-compliant securities broker(s), along with any implementation issues and challenges.
(c) Initiate and complete the inclusion of at least one Shariah-compliant securities broker in their panel of approved brokers by 30.6.26.
4. Phase II: 1.7.26 to 30.6.27
(a) Ensure that at least one Shariah-compliant securities broker remains part of their panel of approved brokers.
(b) Ensure that no less than 20% of overall business is routed through a Shariah-compliant securities broker(s).
5. Phase III: 1.7.27 onwards
(a) The Commission shall evaluate the entity-wise and sector-wise progress and determine the way forward for complete transition to execute all securities trading transactions through Shariah compliant brokerage services.
(b) Further, Shariah-compliant institutional investors are strongly encouraged to switch to takaful for their insurance needs and Shariah-compliant asset management companies for investment purposes.
D. FURTHER DETAILS & SERVICES
Should you require any clarification or explanations in respect of the above or otherwise, please feel free to email Mr Amsal at amsal@kasbati.co with CC to info.kasbati@professional-
Best regards for Here & Hereafter
Asif S Kasbati (FCA, FCMA & LLB)
Managing Partner
Kasbati & Co (1400+ Tax, Levies, Companies, Economy, Inflation, HR, Banking, Finance, etc
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From: Asif Siddiq Kasbati <asif.s.kasbati@
Date: Tue, Sep 9, 2025 at 7:07 PM
A. Background (BG)
1. 322 of 7.9.25 about Summary of Shariat Court Decision against Interest & Insurance - Implementation Deadlines Related Booklet with proper content (Attachment 323.1)
2. This refer to the related QCs in trial, blue, italic and double Line (a) BFIC 313 of 21.5.25 about Promoting Shariah-Compliant Intermediaries Consultation Paper (b) BFQC 70 of 24.2.21 about Free Webinar on Shariah-Compliant Shares, Sukuk, etc – MBL(c) BFQC 53 of 3.11.20 about Shariah compliant matter including tax credit (d) CoQC 278 of 6.11.18 about Shariah Governance Regulations & related tax matters vide SRO 1318
3. We also refer to several Other QCs including (a) CoQC 96 of 23.8.17 about Sukuk (Privately Placed) Regulations, 2017 (b) TLQC 204 of 12.1.17 about Shariah Compliant Tax Credit – SRO 12 (c) CoQC 5 of 5.9.16 about Shariah Screening of Listed Companies for Islamic Equity Indexes vide SECP Circular 29
B. Updated Commentary
1. Further to KQU 3537 of 2.9.25, being an Important matter, we would inform you that about Direction No 25 of 2025 PSX & CDC (Attachment 323.2) in the ensuing paragraph, in Italic with emphasis in bold & Underline, heading ours for quick reading.
2. In exercise of the powers conferred by section 40B of the SECP Act, 1997 (XLII of 1997), read with clause (x) of subsection (4) of section 20 thereof, the SECP hereby directs PSX and the CDC to comply with the requirements contained in this directive, as applicable to them, to enhance or incentivize offering of Shariah-compliant intermediary services.
3. The PSX shall
(a) Ensure timely development of a Shariah-compliant trading mechanism after consensus of stakeholders;
(b) Coordinate with TRE Certificate Holders to submit a plan for transitioning towards Shariah-compliant brokerage services through conversion, forming a subsidiary, or establishing window operations, for onward submission to the Commission; and
(c) Formulate and execute a plan for awareness regarding Shariah-compliant brokerage services.
4. The CDC shall
(a) Create a separate category for Shariah-compliant intermediaries on Asaan Connect (Centralized Gateway Portal) and a separate category for Shariah compliant asset management companies on Emlaak Financials
(b) Collaborate with the SBP to develop a separate category for Shariah-compliant intermediaries on the websites and mobile applications of Islamic banks for the benefit of Roshan Digital Account clients.
C. Further Details & Services
Should you require any clarification or explanations in respect of the above or otherwise, please feel free to email Mr Amsal at amsal@786tax.com with CC to info.kasbati@professional-
Best regards for Here & Hereafter
Asif S Kasbati (FCA, FCMA & LLB)
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From: Asif Siddiq Kasbati <asif.s.kasbati@
A. Background (BG)
This refers to the related Important QCs in trail, blue, italic and double line (a) BFQC 70 of 24.2.21 about Free Webinar on Shariah-compliant Shares, Sukuk, etc - MBL (b) BFQC 53 of 3.11.20 about Shariah compliant matter including tax credit.
B. Updated Commentary
1. Further to KQU 3382 dated 20.5.25, being an important matter, we would inform you about Consultation Paper Promoting Shariah-Compliant Intermediaries in Sector Regulated by SECP (Attachment 313.1).
2. SECP has taken various initiatives for the development of Islamic finance in Pakistan. The Islamic finance industry, broadly covering the Islamic capital market, takaful industry, non-banking finance companies, and modaraba sector, is witnessing steady growth, with expectations of continued expansion.
3. Moreover, the SECP has been actively promoting the implementation of policies and frameworks that would ensure the alignment of these sectors with Shariah principles
4. In addition to sector-specific regulatory amendments, SECP has issuedGuidelines for Offering Islamic Financial Services, 2023, enabling conventional entities to offerShariah-compliant services. Similarly, the Guidelines for Shariah-Compliant Investing on PSX were issued in 2022 to facilitate the general public to invest in PSX while adhering to Shariah principles.
5. In this context, it is important to facilitate Shariah-compliant intermediaries, such as brokers,with the objective to incentivize the wider adoption of Islamic finance within the following sectors regulated by SECP:
1. Islamic capital market
2. Non-banking finance sector
3. Takaful industry
6. This consultation paper proposes certain measures to promote Shariah-compliant intermediaries in the above sectors. The following sections providea brief overview of the recent performance of each of these regulated sectors, a discussionon Shariah-compliant intermediaries, and the proposed measures to promote these intermediaries.
7. Consultation Paper Promoting Shariah-Compliant Intermediaries in Sector Regulated by SECP consist of 10 pages with Interesting Content on page 2.
8. If your Goodself have little time, please look at the Content page and area which is relevant to your entity.
C. Multiplication
Although all the Commentaries are to the extent of the Subscribed IDs only, however, your Goodself is allowed to share this QC is for the Noble Cause to Impart Knowledge for Here & Hereafter.
D. Further Details & Services
Should you require any clarification or explanations in respect of the above or otherwise, please feel free to email Mr Amsal at amsal@kasbati.co with CC to info.kasbati@professional-
Best regards for Here & Hereafter
Asif S Kasbati (FCA, FCMA & LLB)
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