IFMP Pakistan's Market Regulations Certification (PMR), Pakistan key terms

The principal national securities exchange of Pakistan, formed in 2016 by merging the Karachi, Lahore, and Islamabad stock exchanges. It lists equity, debt, and derivative securities and operates under SECP oversight.

The statutory regulator of Pakistan's capital markets, corporate sector, and insurance and non-bank financial sectors. It licenses intermediaries, approves listing rules, and enforces securities law through its Securities Market Division.

The core Pakistani statute governing securities markets, replacing the Securities and Exchange Ordinance, 1969. It defines insider trading, market manipulation, disclosure duties, and SECP enforcement powers over exchanges and intermediaries.

A firm granted a Trading Right Entitlement Certificate by the exchange, permitting it to execute client orders on the PSX. TREC holders must be SECP-registered and meet capital, conduct, and recordkeeping requirements.

Pakistan's licensed central securities depository, holding shares in electronic book-entry form. It settles trades, maintains investor sub-accounts, and operates the central depository system used by PSX participants.

The licensed clearing house that novates and settles PSX trades, manages the clearing and settlement guarantee funds, and operates the Real Time Gross Settlement link with the State Bank for cash settlement.

The standard PSX settlement cycle in which a trade is settled, with cash and securities exchanged, two business days after execution. The cycle applies to the regular market and is administered by NCCPL.

A pooled reserve maintained by NCCPL to cover losses if a clearing member defaults on settlement obligations. Contributions come from members and are sized to protect the clearing house from counterparty failure.

An investor-level account opened under a broker's participant account at CDC, recording that individual's electronic shareholdings. Sub-accounts give investors direct legal evidence of ownership separate from broker records.

The rule requiring brokers to hold client cash and securities separately from firm assets, typically in designated bank or CDC accounts. It protects investors if the broker becomes insolvent or is suspended.

Trading or tipping on material, non-public information about an issuer or its securities. The Securities Act, 2015 prohibits it, and SECP can impose penalties, disgorgement, and trading bans on violators.

Conduct intended to distort a security's price or trading volume, such as wash trades, spoofing, or false rumors. Pakistani securities law treats it as a prohibited market abuse practice subject to SECP enforcement.

PSX rules setting eligibility, disclosure, and continuing obligations for issuers whose securities trade on the exchange. They cover free float, financial reporting, related-party transactions, and delisting procedures.

The portion of a listed company's shares available for public trading, excluding holdings of promoters, directors, and strategic shareholders. PSX uses it to assess liquidity and index eligibility.

The obligation of a listed company to promptly announce price-sensitive events, such as earnings changes, mergers, or major contracts, to the exchange. Timely disclosure keeps markets fair and prevents selective leakage.

The benchmark index of the Pakistan Stock Exchange, tracking 100 companies selected by market capitalization and liquidity. It serves as the primary performance gauge for Pakistani equities and an underlying for derivatives.

A price band or trading halt mechanism that pauses trading when a security or index moves beyond a preset threshold. PSX applies scrip-level and market-level breakers to limit disorderly price swings.

A PSX facility allowing eligible investors to buy securities on credit through brokers, subject to SECP and exchange rules. It sets eligible securities, collateral requirements, and limits on leverage.

The minimum cash or collateral an investor or clearing member must post to cover potential losses on a position. Regulators and the clearing house set these levels to control leverage and settlement risk.

The requirement that financial institutions identify and verify clients' identity, beneficial ownership, and risk profile before opening accounts. In Pakistan, KYC obligations flow from AML/CFT law and SECP and SBP rules.

Laws, rules, and procedures designed to prevent criminals from disguising illegal proceeds through the financial system. Pakistani brokers must file suspicious transaction reports and maintain customer due diligence records.

Pakistan's financial intelligence unit, established under the Anti-Money Laundering Act, 2010. It receives suspicious transaction reports from reporting entities, analyzes them, and shares intelligence with law enforcement and regulators.

A confidential report filed with the Financial Monitoring Unit when an institution suspects funds relate to crime or terrorism financing. Filing is mandatory and tipping off the customer is prohibited.

The former foundational law for Pakistani securities markets, largely superseded by the Securities Act, 2015. Some provisions and rules made under it still inform market practice and legacy enforcement matters.

Pakistan's principal corporate law, governing incorporation, governance, share issuance, and reporting for companies. It underpins listed-company obligations and SECP's corporate regulatory powers.

A pooled investment vehicle that issues units to investors and invests in a portfolio under a licensed asset manager. In Pakistan, mutual funds are regulated by SECP and governed by the Non-Bank Mutual Funds regime.

A SECP-licensed firm that manages mutual funds and investment portfolios under fiduciary duties. It appoints a trustee and custodian and must comply with investment limits and disclosure rules.

The per-unit value of a fund, calculated as total assets minus liabilities divided by units outstanding. Pakistani funds typically compute NAV daily and publish it for subscription and redemption pricing.

A Real Estate Investment Trust that pools investor capital to own income-producing property and distributes most income to unit holders. Pakistani REITs are regulated by SECP under dedicated REIT regulations.

Fixed-income instruments issued by companies or the government, including Term Finance Certificates and Shariah-compliant Sukuks. They are listed and traded on PSX and regulated under SECP debt market rules.

A Shariah-compliant security representing ownership in an underlying asset or project, paying returns from rents or profits rather than interest. Pakistani Sukuks are issued under SECP and Shariah governance rules.

A panel of Islamic scholars that reviews products and structures for compliance with Shariah principles. In Pakistan, SECP requires Shariah-compliant funds and issuers to obtain such board approval.

A broker or institution authorized by CDC to open and maintain sub-accounts and process electronic settlements for clients. Participants must meet CDC eligibility and operational standards.

A price-discovery process in which institutional and other investors submit bids over a range to set an issue price for an IPO or debt offering. SECP rules govern allocation and disclosure in Pakistani book builds.

A company's first sale of shares to the public, accompanied by a prospectus approved under securities law. In Pakistan, IPO shares are listed on PSX after SECP and exchange review.

SECP rules governing acquisitions of control in listed companies, including mandatory offer thresholds and disclosure of shareholding changes. They aim to give minority shareholders fair treatment during change-of-control deals.

A fund maintained by the exchange or regulator to compensate investors harmed by broker default or misconduct, within defined limits. Claims are assessed under prescribed eligibility and cap rules.