The Securities and Exchange Commission of Pakistan (SECP) is moving to enforce a long-dormant regulatory framework designed to protect public funds, which would require real estate companies to secure prior approval and place all advance deposits from buyers into a secure escrow account.

The significant consultative session was led by SECP Commissioner Muzzafar Ahmed Mirza and included Mr. Muhammad Hassan Bakshi, Chairman of the Association of Builders and Developers of Pakistan (ABAD), along with his team of industry specialists. The dialogue centered on activating regulations for property development firms that intend to solicit advance payments for projects.

Provisions for this oversight, which are outlined in the Companies Act, 2017, have remained in abeyance until now. The rules mandate that development firms obtain a No-Objection Certificate (NOC) from the SECP before announcing or advertising any real estate initiative.

Furthermore, the stalled regulations stipulate that all monetary advances collected from the public must be maintained in a dedicated escrow account, shielding the funds from misuse.

During the meeting, participants engaged in detailed discussions on the sector”s ground realities, practical considerations, and existing grey areas. The objective was to craft a robust set of rules that ensures both investor security and the continued growth of the real estate sector.

SECP representatives reiterated their commitment to strengthening regulatory safeguards and promoting transparency in project financing through a trustee mechanism. This consultation is viewed as a critical step toward developing a balanced regulatory system that addresses industry-specific challenges while bolstering public confidence in property investments.