Government’s Response and Directives

This section provides the list of notifications issued by the following regulators in response to COVID-19. The links to these notifications available on the official website of regulators are also provided for the benefit of members.

FBR Notifications  
  Reference Links
Exemption of Duties and Taxes on Diagnostic support and Health Safety Items
FBR vide notifications 235, 236 and 237(I)/2020 dated March 20, 2020 has exempted customs duty, regulatory duty, additional customs duty, withholding tax and sales tax on importof 61 kinds of Diagnostic Support and health safety items including medical equipment/machinery and apparatus like coronavirus detection kits, surgical masks, multimode ventilator with air compressor, face shields and other medical equipment for a period of three months.
Reduction in Taxes and Duties on Import and Supply of Food Items
FBR vide S.R.O. 287 (I)/2020 dated April 07, 2020 has reduced duties and taxes on import and local supply of essential food items; withdrawal of additional customs duty on import of edible oil and oil and abolition of advance income tax on import of pulses till June 30, 2020.
Exemption form Income Tax to PM COVID-19 Pandemic Relied Fund 2020
FBR vide their S.R.O. 300 (I)/2020 dated April 10, 2020 has made further amendments in the Second Schedule to the lncomeTax Ordinance, 2001 to allow exemption from Income Tax to the PM COVID-19 Pandemic Relief Fund-2020.

SECP Notifications  
  Reference Links
Aimed COVID-19; SECP measures to facilitate Insurers and policyholders.
To facilitate insurance policyholders in current challenging times, the Securities and Exchange Commission (SECP) has asked insurance companies to waive non mandatory requirements for claims processing. SECP has also advised insurers to use alternative methods for verifying the authenticity of claims.

SECP asks Insurers to extend coverage of Motor Insurance Policies.
In light of the outbreak of COVID-19, the Securities and Exchange Commission of Pakistan (SECP) has advised non-life insurance companies to grant one month free of cost extension in insurance coverage to all motor insurance policyholders. Due to anticipated low claim ratio in motor business due to lockdown, insurance companies have also been encouraged to take steps to facilitate and pass on the benefit of low claim ratio to motor insurance policyholders

To facilitate borrowers of non-bank lending companies (NBFCs), the SECP has allowed deferment of repayment of principal and rescheduling of loans, based on borrowers’ requests.
Relaxation from Certain provision of Companies Act, 2017 due to COVID-19
SECP vide CIRCULAR NO.6/ 2020 has notified relaxation in relation to compliance with requirements of the Companies Act, 2017due to CoVID-19.

Regulatory Relief TO Dilute impact of COVID-19 for Corporate Sector
SECP vide Circular No. 10 of 2020 has notified relief to corporate sector to dilute impact of Coronavirus) Covid-19) such as general relaxation on holding AGMs, relaxation on disseminating information to shareholders through post, filing of interim financial statements, holding of BOD meeting etc.

Modification in the effective date of IFRS-9
SECP vide their SRO 273(I)/2020 has modified the effective date of IFRS-9for Non-Banking Finance Companies as “Reporting period/year ending on or after June 30, 2021

Relief from Requirements contained in IFRS-9
SECP vide S.R.O. 278 (I)/2020 has allowed all companies relief from the requirements contained in IFRS 9 (IAS 39, IFRS for SMEs and AFRS for SSEs), for recording of fair value adjustments of equity instruments held as FVPL (Fair Value through Profit or Loss) in the Statement of Profit or Loss, as at March 31, 2020.

Relaxation to Asset Management Companies (AMC)
SECP vide their Circular No. 11 of 2020 dated April 9, 2020 has allowed relaxations to the Asset Management Companies (AMCs) for 90 days in relation to compliance with certain requirements of the NBFC Regulations and circulars.

SBP Notifications  
  Reference Links
Ministry of Finance and State Bank of Pakistan introduce risk-sharing mechanism to support bank lending to SMEs and small businesses to avail SBP’s Refinance Facility to Support Employment
The State Bank of Pakistan vide its Circular # ERD/M&PRD/PR/01/2020-47 dated May 6, 2020 has informed that a risk sharing mechanism has been introduced by the Ministry of Finance and SBP to support bank lending to SMEs and small businesses to avail SBP’s Refinance facility to support employment.

State Bank reinforces its support to health sector in fight against COVID-19
In the background of rising cases of COVID-19 in the country and with the need to strengthen health sector in fight against COVID-19, SBP today enhanced financing limit of a single hospital/ medical center under its Refinance Facility for Combating COVID -19 (RFCC) from Rs. 200 million to Rs. 500 million.

The SBP vide Circular # ERD/M & PRD/PR/01/2020‐44 dated April 22, 2020 has advised those Banks/DFIs which have approved dividend declaration for quarter ended March 2020 by 22nd April 2020, to suspend dividend distribution for June and September quarters 2020. All other banks have been advised to suspend dividend distribution for March and June 2020 quarters. This important decision has been taken keeping in view uncertainty arising out of COVID 19 pandemic and resultant probability of higher infections in loan portfolios of banks..
SBP has introduced further incentives for businesses under refinance scheme for payment of wages and salaries to workers and employees to prevent layoffs. To address the issue of providing security/collateral for small vendors/ distributors, financing has been allowed against corporate guarantees of companies in value/ supply chain the relationship with the borrowers. Banks have been encouraged to provide loans without any collateral i.e. taking clean exposure of up to Rs 5 million.
State bank of Pakistan (SBP) vide PSD Circular No. 04 of 2020 notified facilitation to the customers regarding Paper-based Clearing Operations in the wake of COVID-19.

In order to combat the impact of COVID-19 and to help the businesses in payment of wages and salaries to their workers and employees and thereby support continued employment in this challenging environment, State Bank of Pakistan (SBP) has introduced a temporary refinance scheme for payment of wages and salaries to the workers and employees of the business concerns. This Scheme is expected to ease cash flow constraints of the employers and thereby avoid layoffs.

SBP provides more flexibility to hospitals and medical centres under its Refinance Facility for Combating COVID-19 (06.04.2020)
Availability of SBP Helpline for customers of banks and public warning against fraudsters calling for personal information citing situation under COVID-19 (06.04.2020)
SBP extends its relief package to borrowers availing loans under Refinance Schemes (03.04.2020)
National Financial Literacy Program for Youth (NFLP-Y) launches its eLearning Portal (02.04.2020)
SBP and PBA issue Relief Package for households and businesses to cope with impact of COVID-19 Pandemic (26.03.2020)
Relaxation in Foreign Exchange Regulations to Facilitate Imports Against Advance Payment and Open Account Amid COVID-19 Pandemic (25.03.2020)
SBP takes measures to ensure continuous availability of banking services amid COVID-19 situation (23.03.2020)
SBP takes measures to support exporters affected by loss of demand due to COVID-19
State Bank Announces Measures to Facilitate Export-Oriented Sectors and Manufacturing Concerns (19.03.2020)
SBP takes measures to promote Digital Payments amid COVID-19 Pandemic (18.03.2020)
State Bank of Pakistan announces three measures to address the economic and health challenges posed by the spread of COVID-19 (17-03-2020)