ISLAMABAD: New guidelines have been introduced to regulate the opening of trading accounts in the capital markets for minors under the age of 18, aimed at promoting investment awareness and protecting young investors from financial fraud. The guidelines have been issued by the Pakistan Stock Exchange (PSX) in collaboration with the National Clearing Company of Pakistan Limited (NCCPL) and the Central Depository Company of Pakistan Limited (CDC), under the guidance of the Securities and Exchange Commission of Pakistan (SECP).
According to the framework, a guardian may open a trading account for a minor by submitting relevant identification documents issued by NADRA — including a Juvenile Card, Form-B, or Child Registration Certificate. If the guardian is someone other than the father, a Guardianship Certificate issued by a court will be required. The guidelines also stipulate that all anti–money laundering and counter–terrorism financing (AML/CFT) procedures — such as screening, risk assessment, and verification of the source of funds — must be carried out through the guardian.
Receipts and payments in the minor’s trading account may be made through the minor’s own bank account (opened via guardian), a joint account with the guardian, or the guardian’s personal account, as per the agreed terms with the securities broker. Officials said the move is intended to encourage financial literacy and early investment discipline among Pakistan’s youth by facilitating minors’ participation in the formal capital market system.
The tax treatment will follow existing laws, and the guidelines clearly define the procedures and terms for opening and operating minor accounts through natural or court-appointed guardians. They also explain the process for transitioning to a regular trading account once the minor reaches 18 years of age, including the tax implications on asset transfers.
