ISLAMABAD, Pakistan: The Joint setting of the Parliament Monday passed a much awaited bill to convert PIA into a public limited company (The Pakistan International Airlines Corporation (conversion) Bill, 2016) with some amendments unanimously.
Minister for Law and Justice Zahid Hamid moved the PIA (conversion) Bill, 2016 in the House.
The statement of objects and reasons of the bill says, the PIA was established under the Pakistan International Airlines Corporation Act. 1956. In the recent years the national flag carrier has not been able to fulfill its statutory mandate.
The PIA has been incurring huge financial losses and has become a burden on the national exchequer.
The main objectives of the government with regard to the airline are to ensure its continued operations as the country’s national airlines, to promote rapid development and modernization of the airline to encourage injection of capital, skills and latest technology, to upgrade the airline operational and financial performance and to achieve improvement in performance and operational efficiency in various business segments of the airline.
In order to achieve these objectives, it is imperative that the airline be corporatized and converted into a public limited company, incorporated under the Companies Ordinance, 1984.
The conversion will enable the government to revitalize the Airline and develop a healthy, competitive aviation sector in Pakistan.
In clause 4, after sub clause (3), a new sub-clauses are added namely:- Representation on the Board of Directors and all other rights and privileges of shareholders of the Company, or any of its subsidiary companies carrying on air-transport business, shall be proportionate to their share-holding.
The federal government shall carry out or cause to be carried out valuation of the assets of the Company, and its subsidiary companies carrying on air-transport business, by a recognized valuator before transforming any shares of these companies to a third party.
It is pertinent to mention here that earlier the bill was rejected by the Senate twice and the National Assembly passed it with majority votes amid the opposition strong protest.
Earlier, in last joint session of the Parliament a 10-member special committee was constituted by the Speaker National Assembly Sardar Ayaz Sadiq on demand of the Opposition to make consensus on the bill.
The Special Committee in its meeting on April 6 reached consensus on the bill and it was decided that the government would sell as much as 49% of the shares of PIA while the remaining 51% shares would remain with the government.
Likewise, the administrational control of the institution will also not be handed over to the shareholders.
The management of PIA will remain with the Board of Governors however representation within the Board of Governors will be given in accordance with the percentage of shares.
It was also decided in the committee that by converting PIA into a limited company, no impact will take place on the salaries and pensions of the PIA employees and that the assets of the institution will not be sold as well.