Setting Up a Call Center in Pakistan for US and UK Clients: Legal Requirements on Both Sides

Pakistan's BPO and call center industry has grown into a multi-billion-dollar sector, with thousands of operations serving clients in the United States, United Kingdom, and Europe. The cost advantage is obvious: a fully trained English-speaking agent in Lahore or Karachi costs a fraction of what the same resource costs in New York or London. But running a call center that serves foreign clients involves compliance obligations on both sides of the transaction, and getting these wrong can shut down your operation or expose you to serious liability.

Pakistan-Side Requirements

Before you make a single call, you need: SECP company registration (a Private Limited Company is the standard structure for any call center with more than one owner), a National Tax Number from FBR, registration with the Pakistan Software Export Board (PSEB), and a PTA licence for your telephony setup. PSEB registration is not optional if you want the tax benefits. Under the Income Tax Ordinance 2001, IT and IT-enabled services (ITeS) exporters registered with PSEB enjoy significant tax relief on foreign exchange earnings. The current framework provides a reduced withholding tax rate of 0.25% for PSEB-registered exporters compared to 1% for unregistered ones. Your business bank account must be set up to receive foreign currency, and all export proceeds must come through banking channels to qualify for tax benefits.

Employment law is another area that catches people out. Call center workers are employees under Pakistani labour law, and the applicable legislation includes the Standing Orders Ordinance 1968, the Payment of Wages Act 1936, the Minimum Wage Ordinance, provincial social security laws, and EOBI contributions. Night shifts, which are standard for serving US clients, require compliance with the Factories Act provisions on working hours and rest periods. Many call centers operate informally, skipping employment contracts and social security registration. This works until it does not, and a disgruntled employee filing a complaint with the Labour Department can trigger an inspection that uncovers months or years of non-compliance.

US-Side Compliance

If your call center makes outbound calls to US consumers, you are subject to US telemarketing law regardless of where the calls originate. The Telephone Consumer Protection Act (TCPA) regulates autodialed calls, prerecorded messages, and calls to numbers on the National Do Not Call Registry. The Telemarketing Sales Rule (TSR) enforced by the Federal Trade Commission imposes additional requirements on telemarketing calls, including mandatory disclosures, prohibited misrepresentations, and restrictions on when calls can be made (generally 8am to 9pm in the consumer's time zone). Violations of the TCPA carry statutory damages of 500 to 1,500 dollars per call. Class action lawsuits under the TCPA have resulted in settlements of tens of millions of dollars. Your US client may try to contractually shift this liability to you, and your contract with them needs to address this explicitly.

Data protection is the other major compliance area. If you are handling US consumer data (names, phone numbers, email addresses, financial information, health information), you are subject to state-level data protection laws. The California Consumer Privacy Act (CCPA) and its successor the California Privacy Rights Act (CPRA) impose specific obligations on businesses that collect personal information of California residents, including the right to deletion, the right to opt out of sale, and mandatory disclosure requirements. If your call center handles health-related data (for example, appointment scheduling for US medical practices), HIPAA compliance is mandatory, requiring specific technical safeguards, access controls, and Business Associate Agreements.

UK-Side Compliance

For call centers serving UK clients, the relevant regulations include the UK GDPR, the Data Protection Act 2018, the Privacy and Electronic Communications Regulations (PECR), and the Telephone Preference Service (TPS). The UK GDPR applies to any entity processing personal data of UK residents, regardless of where the processing takes place. This means your call center in Karachi that handles UK customer data must comply with UK GDPR, including having a lawful basis for processing, providing privacy notices, implementing appropriate security measures, and responding to data subject access requests within one month. The Information Commissioner's Office (ICO) can impose fines of up to 17.5 million pounds for serious breaches. If your agents are making marketing calls to UK consumers, the TPS must be screened against, and PECR imposes specific consent requirements for electronic marketing.

Practical Guidance for Affected Parties

Anyone dealing with a legal matter in this area should begin by understanding the applicable law, identifying the correct forum, and assessing the strength of their position. Pakistani law provides a range of remedies, but exercising those remedies effectively requires proper preparation, timely action, and competent legal advice. The most common mistakes are: waiting too long to take action (and missing limitation deadlines), filing in the wrong forum (and having the case dismissed for lack of jurisdiction), and failing to gather and preserve evidence (which makes it difficult to prove the case in court).

Documentation is your strongest asset in any legal proceeding. Courts in Pakistan give significant weight to documentary evidence: written agreements, official records, correspondence, receipts, bank statements, and photographs. Oral testimony is important but is treated with caution, particularly where the witness has an interest in the outcome. Before any transaction or event that might give rise to a legal dispute, think about what documents you would need to prove your case, and make sure those documents are created, preserved, and accessible.

Cost and Timeline Considerations

Legal proceedings in Pakistan take time. A civil suit in the trial court typically takes two to f