Pakistan Engineering Council PEC Registration

How to Register A Construction Company In Pakistan

Real Estate and Construction is one of the most viable and productive business in Pakistan. Urbanization has triggered growth in not only sale and purchase of land, plots and houses but also rapid growth is seen in development of residential and commercial societies, construction of houses and buildings in Lahore and other major cities around Pakistan. Government of Pakistan considering the potential in this sector recently allowed important tax benefits and exemptions to persons engaged or willing to get engaged in this sector vide Finance Act 2019. Government of Pakistan has promised not to question the income or investment of persons engaged in construction and sale of residential houses subject to certain limitations. Similarly, Developers and builders has been given serious tax benefits on development of societies and buildings. Sale, purchase, ownership and lease of all kinds of properties is governed by different sets of laws in Pakistan as follow:

The Registration Act 1908

The Land Revenue Act 1967

Transfer of Property Act 1882

Construction Company Registration In Pakistan

The construction company in Pakistan is regulated by different set so laws. It is required by law that for the purpose of registering a construction company, construction or operator approved by Pakistan Engineering Council must be offered Directorship in the company. Construction Company Registration process in Pakistan is divided into three parts:

Registration of Company with the Securities and Exchange Commission of Pakistan (SECP)

Registration with the Federal Board of Revenue (FBR)

Registration with the Pakistan Engineering Council (PEC)

Different requirements are to be meted out at each stage. As reiterated above, Construction Company is required to be registered with the Securities and Exchange Commission of Pakistan. Application for registration of company must be accompanied by license of engineers duly issued by PEC, taking part as director in the company. As a second step you have to register your company with the Federal Board of Revenue and apply for the Business National Tax Number (NTN). Before you apply for Business NTN it is required that each director in company must possess individual NTN as well. Once you have fulfilled these requirements, you will be required to register the company with Pakistan Engineering Council before starting to work as contractor.

The company registration process of Construction Business is similar to the registration of other companies incorporated in Pakistan as a Private Limited Company. To know the procedure for registration of company click on the link How to Register a Private Limited Company in Pakistan?

Registration with the Pakistan Engineering Council

The Pakistan Engineering Council also referred to as PEC is regulator body established under Pakistan Engineering Council Act, 1976. It is the primary professional body that regulates the profession of engineering in the country. The main functions the council include registration of engineers and constructors in Pakistan along with accreditation of engineering programs offered by higher education institutes and universities in Pakistan.

Laws of Pakistan required mandatory registration for construction company in Pakistan with PEC. Without this registration company cannot take part in Governmental project pertaining to construction in Pakistan.

According to Recent PEC policy given in year 2017 there are eight different registration categories for constructors and operators, namely C-A, C-B, C-1, C-2, C-3, C-4, C-5 and C-6. The Central Enrolment Committee (CEC) of PEC processes and approves the licensing of new companies that fall under C-A, C-B, C-1, C-2, C-3 and C-4. Meanwhile, processes the registration of C-5 and C-6 companies by Regional Enrolment Committee (REC). Needless to state that categories foregoing differ on the basis of a company’s worth, the number of engineers and their experience. Registration fee for each category is different and increases with each category.

List Of Documents Required For Registration With Pakistan Engineering Council (PEC)

Following is the List of Documents required at the time of Registration Application submission in the Pakistan Engineering Council.

  • Fill Registration Application form
  • Copies of CNIC of all directors (in case of Company), partners (in case of Firm).
  • Original fee payment voucher
  • The bank statement for last Financial year or Audited Financial Statement/Accounts certified by a Chartered Accountant in Pakistan
  • Copy of NTN Certificate (Company/Firm/Proprietorship)
  • List of machinery and equipment construction company, if any owned
  • Contract or agreement with the machinery supplier, if any
  • Organizational Chart of the Company/ Firm duly signed by the CEO/Managing Partner.
  • Notarized certificate of Sole proprietorship; or
  • Notarized Copy of Form C and Partnership deed; or
  • Form-1, Certificate of incorporation and Memorandum and Articles of Association (in case of Company)
  • Undertaking from CEO/directors/partners/proprietor on stamp paper of Rs. 100

Requirements for C6 PEC Firm registration

For C6 registration in PEC (Pakistan Engineering Council), initial requirements are the same for all kinds of businesses or firms. For C6 company registration with PEC, except NTN registration no other registration with any department is mandatory. But if the firm or company desiring to apply for PEC registration has one or more prior registration with other departments then there is no obligation.

There are different kinds of firms or companies e.g Private Limited, SMC Private Limited, Sole Proprietor, Form-C etc. So, PEC registration requirements are almost the same but with some extra documents. However, the documents required for C6 PEC registration are as under

Sole Proprietor Registration With PEC In C6

  1. Registration with FBR – NTN

NTN – National Taxpayer Number is mandatory for PEC registration in the C6 category or in any other category. Principle activity on NTN must be Engineering related and address on NTN must be the same as desired on the PEC license. But, the NTN numbers must be verifiable online.

Engineer Required For C6 Firm Registration With PEC

For C6 or O6 company registration with PEC, minimum 5 PCP Points (Professional Credit Points) are necessary. In simple words, every Fresh to 5 years experienced engineer has 5 PCP points. So, 1 Registered Engineer or RE is required for C6 registration. Engineer may be from any discipline but must have valid PEC registration.

Closing Balance Required For C6 Registration

PEC has imposed a closing balance requirement for registration in C6 category with PEC. Firm applying for PEC registration in C6 category must have a closing balance of Rs 15 lacs in the account. The account title must be the same as the firm name applied with PEC. But, bank statements must be stamped and signed by bank officials. Moreover, the original Account Maintenance certificate is mandatory for PEC firm registration in C6 or any other category.

Original PEC Challan Fee Deposit Slip

For C6 firm registration with PEC, new registration or C6 renewal annual fee is Rs 15,000/- For details on PEC Registration Fee details for New registration, PEC license renewal and PEC license up-gradation, please click here. Sample PEC challan deposit slip is shown below. However, these deposit slips are available in HBL Civic Center Branch 0602 and MCB Melody Branch, Islamabad.

PEC C5 Registration with Engineer Partner.

A sole proprietor, Single Member Company or Private Limited Company can apply for direct registration in C5 with PEC. But, Owner of the firm or at least 1 director / Partner must be Engineer having a valid PEC registration card as Registered RE Engineer. A fresh Engineer as owner or partner can apply for direct PEC registration in C5 without showing any prior experience. Engineer owned C5 firm will deposit Rs 30,000 PEC fee by filling PEC bank challan form. For C5 registration, only 5 PCPs (Professional Credit Points) are required which can be fulfilled with a freshly registered engineer. In case of Private Limited or Partnership firm/ Form-C firm, Engineer must hold at least 20% shares in the company capital.

C5 New firm Registration on Financial basis

If the owner or director/partner is not an Engineer, then can we get PEC C5 license? Yes, Non-Engineer owner can also get PEC registration in category C5 on financial/net-worth base. If a firm or company has closing balance of minimum Rs 30 lacs then the firm is eligible for PEC registration in category C5. In case of SECP registered company, Audit report verified by registered chartered accountant firm is mandatory.

C5 firm Registration with PEC on Work Orders

If a firm/company has executed engineering works without having valid PEC registration then the firm will be liable for PEC penalty. For consideration of these works, firm /company will pay fine then PEC will consider these works. Total work orders of worth of Rs 45.5 Million will be mandatory for C5 registration with PEC. However, work executed must be with Government or semi-government organization.

  1. PEC Company Registration in C4 Category

PEC registration in category C4 is possible? or How to register our company in C4 with PEC? Yes, direct PEC registration in category C4 is possible.

Requirements for C4 Registration

For PEC C4 license registration, following are basic requirements

  1. CNICs of all the owners
  2. NTN of the firm – must have the same address as written on firm letterhead.
  3. Firm bank account statement for last 6 months
  4. Account maintenance certificate
  5. Closing balance of Rs 6 Million
  6. Verifiable Chartered Account Firm audit report
  7. company/firm seal

 

 PEC Company Registration in C3 Category

New registration with Pakistan Engineering Council PEC is somehow a lengthy process when talking about big contractor categories. Almost every investor want registration in higher categories with PEC. It is a common question that our firm has no prior experience, can we get new firm registration in C3 category with PEC? Yes, direct registration with PEC in c3 category is possible on 1 of the 3 options. 1. C3 registration on Financial worth base 2. New C3 firm registration on Engineer partner based 3. Firm registration in C3 on work orders based (quite difficult)

Documents Required For C3 Registration

Following documents are required for C3 PEC firm registration with PEC

  1. Copies of CNICs of all partners (if any)
  2. NTN certificate
  3. Letterhead
  4. Firm stamp
  5. Firm Bank account statement
  6. Closing balance of Rs 30 Million – if financial worth option is availed
  7. Bank account maintenance certificate

 

PEC Company Registration in C2 Category

C2 category is considered a big category in PEC. Can we get C2 registration directly with PEC? Yes, a new firm or company can apply and get PEC registration in C2. There are around 7,000 firms registered in C2 category with PEC.

PEC Company Registration in C1 Category

For direct registration with PEC in C1 category, we can avail one of the 2 options. i- 2 partner engineers having more than 20 years of experience. ii- Financial soundness basis with QCR Chartered Accountant firm.