The First Reading — No. 1

This is the first number of The First Reading, our monthly digest. The format is fixed: ten developments, one paragraph each, and one thing worth reading slowly. We pick what a general counsel or a board in Pakistan should actually know, not everything that happened. Positions are stated as of May 5, 2026. Anything we could not verify against the instrument as issued is bracketed for the reviewing lawyer.

1. Where constitutional challenges now go

The Twenty-Sixth Amendment of October 2024 moved constitutional jurisdiction to designated constitutional benches. The Twenty-Seventh Amendment of November 2025 went further and provided for a Federal Constitutional Court [COMMENCEMENT, COMPOSITION AND TRANSFER OF PENDING CASES TO BE VERIFIED BY REVIEWING LAWYER]. For a company challenging regulatory action, the practical question is forum: confirm where an Article 199 petition or a constitutional question now lies before filing, and expect transfer arguments in anything already pending.

2. NAB references after the restored amendments

The Supreme Court's intra-court appeal decision of September 2024 restored the 2022 amendments to the National Accountability Ordinance 1999, including the Rs 500 million threshold [CITATION — TO BE VERIFIED]. Matters below the threshold stand routed to other forums — FIA, provincial anti-corruption establishments, ordinary criminal courts — and accountability courts have spent the months since re-fixing what remains. If your matter predates the amendments, confirm where it now sits before assuming anything about remand, bail or trial timelines.

3. PECA's new machinery is being built in public

The Prevention of Electronic Crimes (Amendment) Act 2025 created a new regulator, a complaints structure and dedicated tribunals, and replaced the FIA's cybercrime wing with the National Cyber Crime Investigation Agency. The false-information offence in the amendment carries imprisonment. Constitutional challenges are pending before the high courts [STATUS OF PETITIONS AND OF TRIBUNAL CONSTITUTION TO BE VERIFIED]. Until the case law settles, treat any online-content complaint against the company or its officers as a criminal matter from day one.

4. The FBR can now arrest for tax fraud

The Finance Act 2025 gave the Federal Board of Revenue arrest powers in sales tax fraud cases, with approval safeguards added after sustained objection from the business community [SECTION NUMBERS AND CURRENT SAFEGUARDS TO BE VERIFIED]. The practical consequence is that a tax audit with a fraud allegation attached is no longer only a money dispute. Involve defence counsel at the notice stage, not at the arrest stage, and keep the record of every response.

5. CCP enforcement is steady; recovery is the fight

The Competition Commission of Pakistan continued its run of cartel and deceptive-marketing orders through early 2026 [SPECIFIC ORDERS TO BE VERIFIED], but most penalties sit behind appeals and interim orders, and the appellate tribunal's capacity remains the bottleneck [TRIBUNAL COMPOSITION AND PENDENCY TO BE VERIFIED]. The compliance point is unchanged: trade-association meetings are where cartel cases are born. Keep agendas, keep minutes, and give commercial teams a written protocol for competitor contact.

6. The State Bank keeps loosening the exchange perimeter

The repatriation queue that defined 2023 has largely normalised, and the SBP has continued adjusting the Foreign Exchange Manual — import payments, exporter retention, outward investment — through circulars rather than a single reform [SPECIFIC CIRCULARS OF EARLY 2026 TO BE VERIFIED]. Foreign shareholders planning dividends or exits should still sequence around the Manual: registration of the investment, the bank's role as authorised dealer, and the documentary trail come before the board resolution, not after.

7. Virtual assets have a regulator on paper

The virtual-assets legislation of 2025 established the Pakistan Virtual Assets Regulatory Authority and a licensing regime for service providers [STATUS OF THE INSTRUMENT AND OF LICENSING RULES TO BE VERIFIED]. The banking channel remains the hard constraint: the SBP's longstanding caution to banks on virtual-currency dealings has not been withdrawn to our knowledge [TO BE VERIFIED]. Anyone building in this space should plan for a licensed future and a banked present that do not yet fully connect.

8. AGM season is challenge season

Companies with December year ends are now inside the annual-meeting window under section 132 of the Companies Act 2017. The recurring litigation lesson: resolutions fail on mechanics, not merits. Notice content, quorum, proxy handling and the voting record are what a hostile shareholder attacks. Confirm the SECP's current position on virtual and hybrid meetings before convening one [CURRENT GUIDANCE TO BE VERIFIED], and pay dividends only through the electronic channel section 242 requires.

9. Arbitration reform is still a bill

The draft legislation to replace the Arbitration Act 1940 with a statute modelled on the UNCITRAL Model Law remains pending before Parliament [STATUS TO BE VERIFIED]. Domestic arbitration is therefore still governed by the 1940 Act, and foreign awards by the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act 2011. Draft dispute clauses for the law as it is: a foreign seat in a New York Convention state remains the most enforceable choice for cross-border contracts.

10. Budget watch

The Finance Bill 2026 is expected in June. Super tax under section 4C of the Income Tax Ordinance 2001 and the deemed-income tax under section 7E both remain in litigation [STATUS OF APPEALS TO BE VERIFIED], which means the June numbers may move again in the courts. Boards modelling transactions for the new fiscal year should build both outcomes into the numbers rather than assume the current text survives.

The long read

Read the Supreme Court's intra-court appeal judgment restoring the 2022 NAB amendments [CITATION — TO BE VERIFIED], majority and minority both. It is the clearest recent statement of how the Court approaches accountability legislation — what Parliament may recalibrate, and what it may not — and it is the frame within which every pending reference will be argued for the next several years.