Corporate Industrial Restructuring Corporation Ordinance, 2000

This Ordinance set up the Corporate and Industrial Restructuring Corporation (CIRC) to buy up, restructure, and dispose of bad loans and other troubled assets held by government-owned banks and financial institutions, in order to help distressed businesses and support the wider economy. Section 4 establishes CIRC as a body corporate headquartered in Islamabad. Section 2 defines a "non-performing asset" as a financial asset on a financial institution's books where the borrower has been in arrears for more than three hundred and sixty-five days and the outstanding payment obligation exceeds thirty million rupees -- a figure the Federal Government can alter by notification, so it should be checked against the current text.

The Schedule lists the financial institutions CIRC deals with, including Habib Bank Limited, United Bank Limited, National Bank of Pakistan, National Development Finance Corporation, Industrial Development Bank of Pakistan, and Agriculture Development Bank of Pakistan, along with the extent of Federal Government ownership in each. Section 6 sets the Board's composition, including the Finance Minister, Commerce Minister, Industries Minister, the Governor of the State Bank of Pakistan, the Chairman of the Privatization Commission, and the Finance Secretary, alongside CIRC's own Chief Executive. Section 10 provides for Verification Committees and Section 12 for an Administration Committee to help run day-to-day affairs.

Section 18 sets out the business CIRC can transact, while Section 19 makes clear it is not itself a banking company. Section 22 allows CIRC to issue bonds to fund its acquisition of non-performing assets. Section 34 lets the Federal Government exempt CIRC from taxes, and Section 25 establishes its own Corporation Fund.

Section 35 gives CIRC a statutory life of six years from commencement, extendable by the Federal Government by law; notably, if CIRC is wound up before the end of its third year, all non-performing assets it still holds automatically revert to the financial institution that transferred them. Section 37 lets CIRC recover outstanding amounts as if they were arrears of land revenue. Section 38 lets CIRC demand information from any person, bank, or financial institution, and failing to comply is punishable with imprisonment of up to one year, a fine, or both.

The extract shows this 2000 Ordinance has been amended, including by the Corporate and Industrial Restructuring Corporation (Amendment) Act, 2005, which changed the definition of "Financial Institution," so figures like the thirty-million-rupee threshold and the institutions covered should be verified against the current text.