BOI Approval for Foreign Shareholders in Pakistan – Complete Step-by-Step Guide

BOI Approval for Foreign Shareholders – Complete Walkthrough
Introduction
When a company in Pakistan includes foreign shareholders, it must obtain approval from the Board of Investment (BOI), the government body that regulates and facilitates foreign investment. Whether you’re registering a foreign-owned company or adding an overseas partner later, BOI approval ensures legal entry of foreign capital and compliance with Pakistan’s investment laws.
What Is BOI Approval?
The Board of Investment (BOI) operates under the Prime Minister’s Office and serves as the regulatory gateway for foreign investors entering Pakistan. BOI approval is required for incorporating a foreign-owned company with SECP, adding a foreign shareholder to an existing Pakistani company, transferring shares from a local to a foreign investor, or opening a branch or liaison office of a foreign company. This approval confirms that the foreign investment complies with Pakistan’s Foreign Private Investment (Promotion and Protection) Act, 1976 and other related regulations.
When Is BOI Approval Required?
You must apply for BOI approval in the following cases:

1. New Company Incorporation – When a foreign individual or company is listed as a shareholder in the Memorandum of Association.

2. Post-Incorporation Change – When existing shares are transferred to a foreign person or entity.

3. Equity Investment from Abroad – When foreign funds are injected to increase paid-up capital.

4. Branch or Liaison Setup – When a foreign company wants to establish operations in Pakistan.
   Step-by-Step Process for BOI Approval
   Step 1: Prepare SECP Documents
   Before applying to BOI, ensure your company is properly registered with the Securities and Exchange Commission of Pakistan (SECP). Keep the following ready: Certificate of Incorporation, Memorandum and Articles of Association, Form 29 (List of Directors), and Form A (Annual Return, if applicable).
   Step 2: Fill the BOI Application Form
   Access the form through the BOI e-services portal (www.invest.gov.pk) and choose the relevant category: Foreign Ownership in Local Company or Branch Office/Liaison Office Registration. Provide information about foreign shareholders, investment amount, and business activities.
   Step 3: Attach Supporting Documents
   Prepare the required documents:

• SECP Incorporation Certificate

• Memorandum & Articles of Association

• Board Resolution approving shareholding

• Passport copy (for individual foreigners)

• Certificate of Incorporation (for foreign company)

• Proof of remittance or investment (bank document)

• Power of Attorney (if submitted through a representative)
  Step 4: Submit Application Online
  Submit all documents on the BOI e-portal or through the relevant regional office (Islamabad, Karachi, or Lahore). Pay the processing fee, usually between PKR 5,000–10,000 depending on the case.
  Step 5: BOI Review and Verification
  The BOI reviews the application to ensure it complies with Pakistan’s investment policy. They verify the source of funds and business sector to confirm it’s not on the restricted list for foreign investment.
  Step 6: Approval Letter Issued
  Once approved, BOI issues a Letter of Approval or Permission Certificate confirming the investor’s eligibility. This letter is essential for updating SECP records (Form 3 and Form 29), informing the State Bank of Pakistan (SBP) about remittance inflows, and opening foreign currency accounts.
  Restricted or Sensitive Sectors
  Foreign investors cannot invest without special permissions in certain sectors such as arms and ammunition, high explosives, radioactive materials, currency and mint operations, and security printing. All other sectors are open to 100% foreign ownership under current BOI policy.
  Timeline and Validity
  Processing time is typically 2–3 weeks if documents are complete. The approval remains valid as long as the company maintains compliance with SECP and FBR regulations.
  Post-Approval Requirements
  After receiving BOI approval:

1. Update SECP Records – Submit relevant forms (Form 3 or Form 29) showing new shareholding.

2. Report to State Bank of Pakistan (SBP) – Inform SBP through your bank about foreign investment inflow.

3. Update FBR Registration – Reflect ownership changes in the company’s tax profile.

4. Maintain Annual Compliance – File annual returns and maintain transparency for BOI or SBP audits.
   Common Mistakes to Avoid
   Avoid incomplete forms, unverified documents, failure to disclose share percentages, or missing embassy attestations on foreign documents. Always report remittances through official banking channels to ensure compliance with SBP rules.
   Why BOI Approval Matters
   BOI approval legitimizes your company’s foreign ownership and provides protection under Pakistan’s investment laws. It ensures smooth capital remittance, profit repatriation, and credibility with SECP, banks, and investors. Without it, your company could face compliance delays or restrictions on foreign capital entry.
   Final Thoughts
   Getting BOI approval for foreign shareholders is a key step toward a legally secure and internationally recognized business in Pakistan. With proper documentation, timely submission, and compliance with SECP and SBP regulations, foreign investors can confidently establish or join Pakistani companies without facing legal or operational hurdles.