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The Securities and Exchange Commission of Pakistan (SECP) has issued a directive instructing all companies to abstain from entering agreements or contracts with surrogate entities that originally operate as gambling, betting, and casino companies.
This directive, denoted as SRO(I)/2023, was disseminated on Tuesday by the SECP. As per the SECP’s notification, the Ministry of Information and Broadcasting, under the title “Zero Tolerance for Surrogate Companies,” has communicated the presence of certain surrogate companies masquerading as betting entities in the Pakistani market.
These entities have engaged in sponsorship and advertisement contracts with various media and sports enterprises. The SECP advises companies to avoid entering into any agreements or business relationships with these surrogate companies.
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The notification highlights that these entities have roots in gambling, betting, and casino activities, often orchestrated by adversarial nations seeking to undermine Pakistan’s moral fabric, introduce corruption into the national sports teams, and exacerbate economic instability by channeling untaxed funds out of the country in foreign currency.
Numerous advertisements for such surrogate betting companies are currently being broadcast on digital, electronic, social, and print media in Pakistan. It is imperative to curtail the operations of these surrogate betting companies within the country.
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To this end, the Pakistan Cricket Board, Pakistan Super League, PSL franchises, club cricket, private leagues, television channels, radio broadcasters, internet platforms, newspapers, magazines, and other media/advertisement platforms are strongly advised against entering any agreements or business relations with such surrogate companies and are prohibited from promoting them through any form of advertisement.
Furthermore, companies are urged to promptly terminate any existing agreements with such surrogate entities. The Securities and Exchange Commission of Pakistan, exercising its authority under Section 40B of the SECP Act, 1997, explicitly directs all companies and Limited Liability Partnerships (LLPs) to ensure compliance with the advisory issued by the Ministry of Information and Broadcasting in both letter and spirit, as outlined in the SECP’s notification.
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