Pakistan's Prime Minister Nawaz Sharif has announced that he will set up an independent judicial commission to probe whether his family is involved in illegal overseas investments after reports based on documents leaked from a Panama-based law firm indicated his sons owned several offshore companies.

In a televised address to the nation Tuesday, Sharif said a retired judge from the Supreme Court of Pakistan will head the commission.

He asked those levelling corruption charges against his family to cooperate with the commission and prove any allegations.

Sharif's comments came a day after his son Hussain Nawaz admitted he owned offshore companies and property abroad which has been disclosed in the so-called Panama Papers leaks.