S.R.O.
1214 (1)/74, dated 23rd December, 1979: In exercise of the powers
conferred by Section 44 of the Employees’ Old-Age Benefits Act, 1976 (XIV of
1976) the Federal Government is pleased to make the following rules:-
(1) These rules may be called the Employees’
Old-Age Benefits (Investment) Rules, 1979.
(2) They shall come into force at once.
In these rules unless
there is anything repugnant in the subject or context:-
(a) “Act” means the Employees’ Old-Age Benefits
Act, 1976 (XIV of 1976);
(b) “authority” means an authority constituted
by or under any law, and includes an authority constituted under any housing or
building scheme approved by the Federal Government or a Provincial Government;
(c) “company” has the same meaning as defined in
clause (2) of Section 2 of the Companies Act, 1913 (VII of 1913);
(d) “controlled company” means a company in
which not less than fifty-one per cent of the voting share capital is held by
the Institution;
(e) “corporation” means a corporation
constituted by or under any law;
(f) : “debenture”: means written acknowledgement
of a debt raised by an authority, corporation, company or non-guaranteed bank
and secured by a trust deed or mortgage, the debt being repayable at specified
date or dates;
(g) “dividend” means the distribution of profit
in cash among, or of bonus shares in lieu thereof to, its shareholders by an
authority, corporation, company or non-guaranteed bank;
(h) “Government-guaranteed securities” means
securities in respect of which the Federal Government or a Provincial Government
has given a full and unconditional guarantee both as regards the principal and
interest payable thereon on being presented at the State Bank or other bank or a
Treasury Office;
(i) “Government securities” means Government
securities as defined in the Securities Act, 1920 (X of 1920), and includes
Government Treasury Deposit Receipts, Postal Savings Deposits, Khas Deposit
Certificates, Defense Saving Certificates, National Deposit Certificates and
such other similar certificates as may be introduced by the Federal Government
or a Provincial Government under any scheme;
(j) “guaranteed-bank” has the same meaning as
defined in clause (1) of Section 3 of the Bank (Nationalization) Act, 1974 (XIX
of 1974);
(k) “net-worth” in respect of any authority,
corporation, company or non-guaranteed-bank, means to the total value of its
assets in Pakistan less the total actual and contingent liabilities (other than
in respect of ordinary of preference shares), provisions for liabilities, loans
and other charges payable, out of, or provided against, or charged on, the said
assets;
(l) “non-guaranteed-bank” means a scheduled bank
with a paid-up capital of not less than thirty million rupees, not being a
guaranteed-bank;
(m) “ordinary share capital” means any class or
classes of share capital which under the constitution of an authority,
corporation, company or non-guaranteed bank to which it relates has no right to
any fixed or preferred dividend or to any priority in the event of its winding
up or liquidation;
(n) “paid-up capital” means the total amount
credited as paid-up on issued share capital;
(o) “portfolio” means the aggregate of all
investments made by the Institution at book value; and
(p) “preference share capital” means any class
or classes of share capital which under the constitution of any authority,
corporation, company or non-guaranteed bank to which it relates has a right to a
fixed or preferred dividend or a priority over any other class of capital in the
event of its winding up or liquidation.
The Institution may
invest any moneys which are not immediately required for expenses under the
Act:-
(a) in Government securities;
(b) in Government-guaranteed securities;
(c) in
loans to bodies or persons holding Government securities or Government
guaranteed securities, the realizable value of which exceeds the amount of the
loan and the accrued interest and other charges thereon, by not less than twenty
per cent and such securities are pledged, hypothecated or assigned to the
Institution;
(d) in interest-bearing deposits in guaranteed
banks;
(e) in
debentures or loan stocks of, or other securities for money issued by, of loans
to, any such authority, corporation or company, or interest-bearing deposits in
such non-guaranteed bank as have paid dividends of not less than ten per cent
per annum on their respective ordinary share capital for the two accounting
years, or have paid interest in full on debentures issued or other money
obligations incurred by them and have not defaulted in the repayment or the
principal thereof during thirty-six months immediately preceding the day on
which investment is made;
(f) in
ordinary or preference shares of any such authority or corporation or of such a
company listed with any stock Exchange in Pakistan, as has paid dividends of not
less than ten per cent. per annum on its ordinary share capital for three
accounting years immediately preceding the year in which investments is made;
(g) in
ordinary or preference shares or debentures or loan stock of, or other
securities for money issued by, or loans to, a controlled company;
(h) in immovable property, whether freehold or
leasehold; or
(i) with
the previous approval of the Federal Government, in such other investments as
the Institution may think it fit.
(1) Subject
to these rules, the following shall be the limits up to which investments may be
made under rule 3, namely:-
(i) For
investment clauses (a) to (d), no limit.
(ii) For
investment under clause (e), fifty per cent. of the portfolio.
(iii) For
investment under clause (f), fifty per cent. of the portfolio.
(iv) For investment
under clause (g),-
(a)
in respect of any controlled company, ten percent, of the portfolio; and
(b)
in respect of all such controlled companies together, thirty percent of the portfolio.
(v) For investment
under clause (h),-
(a)
in respect of any one property, ten percent of the portfolio; and
(b)
in respect of all properties together thirty per cent. of the portfolio.
(vi) For investment under clause (i), two and-a-half percent of the portfolio.
(2) No investment
made in any one authority, corporation, company or non-guaranteed bank under
clause (e) and
(f) of rule 3 shall
exceed twenty-five percent of its paid-up capital, or twenty-five per cent of
its net worth in
Pakistan or two
and-a-half per cent of the portfolio, whichever is less:
Provided that if there
be any investment in partly paid-up shares of an authority, corporation,
company or
non-guaranteed bank, the limit shall be reduced by the uncalled for liability in
respect of
such shares.
(3) The aggregate of
all investments made under clauses (f), (g) and (h) shall not exceed fifty
percent of the portfolio.
(4) The aggregate of
all investments made under clauses (e), (f), (g) and (h) shall not exceed eighty
percent of the portfolio.
Rule 3 of the Investment Rules prescribes the permissible investments that EOBI is authorized to make, and sub-rule (h) of Rule 3 authorizes EOBI to invest any moneys which are not immediately required for expenses under the EOB Act in immovable property,whether freehold or leasehold. Further, sub-rule 4(1)(v) of the Investment Rules, which prescribes the threshold to invest inimmovable property, states that EOBI can invest up to (i) ten percent of its portfolio, in respect of any one immovable property, and (ii) thirty percent of its portfolio, in respect of all immovable properties collectively. |
|
(1) If
at any time the existing investments in any class or aggregate of classes or in
any one authority, corporation, company, non-guaranteed bank on immovable
property exceed the limits prescribed by rule 4, then, except as provided in
rule 6, no additional investment by way of actual disbursement of money or
money’s worth shall be made by the Institution at that time in such class or
classes, or authority, corporation, company, non-guaranteed bank or immovable
property.
(2) In
respect of any class or aggregate of classes, or any one authority, corporation,
company, non-guaranteed bank or immovable property, no additional investment
shall be made at any time by way of actual disbursement of money or money’s
worth if such additional investment will cause the limits prescribed by rule 4
to be exceeded, except as provided in rule 6.
(3) For
the purposes of this rule and rules 3,4 and 6 all existing investments shall be
taken at current book value.
The Institution may, with the previous
approval of the Federal Government, invest its money, in excess of the limits
prescribed by rule 4:
Provided that
the aggregate of all investments made under this rule, together with investments
made under clause (i) of rule 3, shall not exceed two and a half percent of the profolio
The Institution may
make loans to its officers and members of staff in accordance with the
regulations made in this behalf, but the total amount of such loans outstanding
at any time, including any interest accrued thereon, shall not exceed two
percent of the assets of the fund at its book value.
The
Institution may at any time sell or realize any of its investments at such
price, and reinvest all or part of the proceeds in such manner as it deems fit.
The
Institution shall ensure that “Proper” and adequate arrangements are made for
the safe custody of the documents of title relating to investments.
|