Share Certificate
Share certificate will only be issued upon application
Register of members becomes prima facie evidence as to the title of the shares.
Definition of Board
“Board” in relation to a company, means—
a) Directors of the company who number not less than the required quorum acting as a board of directors; or
b) If the company has only one director, that director;
Resignation, Vacation or Death of Last Remaining Director
In the event the office of a sole director or the last remaining director becomes vacant die to death, disqualification of being director or otherwise vacation of office in accordance with the constitution, the secretary is responsible to call a meeting of next of kin or personal representatives for the purpose of appointing a new director.
If the next kin, personal representative or members fail to appoint a director within 6 months, the Registrar may direct to strike the company off the register.
Provisions Affecting Company Secretaries
Duty of secretary to enter issuance and transfer of shares in the register of members
Secretary shall cause the register of members to be properly kept and maintained regularly and all the particulars on issuance and transfer of shares are entered into the register.
Penalty: fine not exceeding ten thousand ringgit and, in the case of a continuing offence, to a further fine not exceeding five hundred ringgit for each day during which the offence continues after conviction.
Resignation, Vacation or Death of Sole Director or Last Remaining Director
For the purpose of appointing a new director, in the event of the office of a sole director or the last remaining director of the company being vacated, the secretary shall, as soon as practicable, call a meeting of the next of kin, other personal representatives or a meeting of members, as the case may be.
The secretary shall be entitled to be indemnified by the company in relation to any reasonable reasons and expenses of the meeting so convened.
Requirement to Register with Registrar
New Requirement for ALL Secretaries to register with Registrar:
Any person who is qualified and desires to act as a secretary must register with the Registrar before he/she can act as a secretary.
Once registered, a practicing certificate will be issued.
Transitional period; Within 1 months from the commencement of the Act, existing secretaries are required to be registered.
Provisions Affecting Auditors
Requirement of an Auditor Under the Companies Act 2016
- Every company is required to have at least one auditor
- Auditors must be approved by MOF
Qualification for appointment as company auditor is similar to CA 1965 except:
Indebtedness not exceeding RM25,000.
Recognition of audit firms registered as LLP:
The appointment of a firm in the name of LLP will take effect as appointment of partners and employees who are approved company auditor at the time the appointment or later as auditors of a company
Appointment and Terms of Office
Appointment of auditors of a private company under The Companies Act 2016
The registrar has the power to exempt certain categories of private companies from having to appoint auditor
Terms of office of a private company
An auditor ceases office thirty days from the circulation of the financial statements unless he is reappointed.
Appointment of auditor of a public company under The Companies Act 2016
From one AGM to the next AGM.
Resignation of auditor under The Companies Act 2016
- By giving notice in writing and delivered to the registered office of the company.
- Resignation takes effect after twenty-one days or from the date as may be specified in the notice.
Attendance where financial statements are laid
- Auditors or his representative must attend the meeting where the financial statement of the company is being laid.
- To respond to any question relevant to the audit of the financial statements Mandatory for public companies.
- In cases of private companies, only becomes mandatory when requested by the company.
Meetings and Decision Making
Written Resolutions
Provisions relating to written resolutions are only applicable to private companies.
The required percentage to pass a resolution will be similar as though the resolution would be passed at a meeting of members.
Members’ Power to Require Circulation of Written Resolution
Members having a total of 2.5% voting rights or 50 members who have right to vote and for companies not having a share capital, members having a total of 2.5% voting rights, to be allowed to a statement to demand, alter or add items into the AGM’s Agenda.
However, the company has the option not to circulate the statements if they are frivolous, vexatious or defamatory and if such statement is not in the best interest of the company.
Meetings at Multiple Venues
- A company may hold meeting at more than one venues.
- Using any technology or method that enables members of the company an opportunity to participate and exercise their right to speak and vote at the meeting.
- Main meeting venue shall be in Malaysia where the chairperson is present.
Compliance Requirements Annual Return
De- coupling of the requirement to lodge audited financial statements
Must be lodged within 30 days of the anniversary of the company’s incorporation date.
Company may submit a “non-change” annual return when there is no change since the last annual return was filed.
Failure to lodge more than 3 consecutive years is a ground for striking off
Duty to lodge financial statements and reports with the Registrar
In the case of private company, financial statements are to be lodge within 30 days from the time the financial statements were circulated to members.
In the case of public company, within 30 days from its AGM.
Advantage of No Constitution
Advantages:
- A company may hold meeting at more than one venues.
- Using any technology or method that enables members of the company an opportunity to participate and exercise their right to speak and vote at the meeting.
- Main meeting venue shall be in Malaysia where the chairperson is present.
Methods of holding Board Meetings
- By a number of the directors who constitute a quorum, being assembled together at the place, date and time appointed for the meeting; or
- By means of audio, or audio and visual, communication by which all directors participating and constituting a quorum can simultaneously hear each other throughout the meeting
Director’s Resolution in Writing
Clause 15. A resolution in writing, signed or assented to by all directors then entitled to receive notice of meeting of the Board, is as valid and effectiveness as if it had been passed at a meeting of the Board duly convened.
Clause 16. Any such resolution may consist of several documents, including facsimile or other similar means of communication, in similar form and each document shall be signed or assented to by one or more directors.
Clause 4. A notice of meeting the Board shall be sent to every director who is in Malaysia, and the notice shall include the date, time and place of the meeting and the matters to be discussed.
Clause 5. An irregularity in the notice of a meeting is waived if all directors entitled to receive notice of the meeting attend the meeting without objection to the irregularity.
New Obligation
Sec.57 – a register of directors shall contain the particulars of a director relating to his name, residential address, service address, date of birth, business occupation & identification.
Sec.2 – “Service address”, in relation to a director, means an address, electronic or otherwise, provided to the company to which any communication may be sent;
Death of Sole Director
Sec. 209(3) – For the purpose of appointing a new director, in the event of the office of a sole director or the last remaining director of the company being vacated due to the circumstances referred to in paragraph 208(1)(d), (e), (f) or (g), [disqualified by Court, becomes of unsound mind, dies or vacates according to the constitution] the secretary shall, as soon as practicable, call a meeting of the next of kin, other personal representatives or a meeting of members, as the case may be.
Company Secretary
Sec. 238 (1) – A person shall be disqualified to act as a secretary if he is an undischarged bankrupt; he is convicted in or outside Malaysia of offences in Sec. 198 or he ceases to be a holder of a practicing certificate (PC) issued under Sec. 241
Sec. 238(2) – If the Registrar is of the opinion that a person has failed to act honestly or use reasonable diligence in the discharge of his duties as a secretary, the Registrar may require the person to show cause why his PC should not be revoked or why he should not be disqualified
Accounting Records And Company Auditors as mentioned in The Companies Act 2016
SECTION 245: ACCOUNTS TO BE KEPT.
(1) A company, the directors and managers of a company shall-
(a) Cause to be kept the accounting and other records to sufficiently explain the transactions and financial position of the company and enable true and fair profit and loss accounts and balance sheets and any documents required to be attached thereto to be prepared.
(b) Cause the accounting and other records to be kept in a manner as to enable the accounting and other records to be and properly audited.
(2) A company, the directors and managers of a company shall cause appropriate entries to be made in the accounting and other records within sixty days of the completion of the transactions to which the entries relate.
(3) The company shall retain the records referred to in subsection (1) for seven years after the completion of the transactions or operations to which the entries relate.
(4) The records referred to in subsection (1) shall be kept at the registered office of the company or at such other place as the directors think fit, and shall at all times be open for inspection by the directors at all times.
(5) Notwithstanding subsection (4), the accounting and other records of operations outside Malaysia may be kept by the company at a place outside Malaysia provided that such accounting and other records shall be sent to and kept at a place in Malaysia and be made available for inspection by the directors at all times.
(6) The accounting and other records referred to in subsection (5) shall include such statements and returns with respect to the business dealt with in the records so kept as to enable the preparation of true and fair financial statements and any documents required to be attached to the financial statement.
(7) If any accounting and other records are kept at a place outside Malaysia under subsection (4) or (5), the Registrar may require the company to produce those records at a place in Malaysia or determine the type and manner of the records to be kept in Malaysia.
(8) The Court may, in any particular case, order that the accounting and other records of a company be open to inspection by an approved company auditor acting for a director, subject to a written undertaking given to the Court that information acquired by the auditor during his inspection shall not be disclosed by him except to that director.
(9) The company and every officer who contravene this section commit an offence and shall, on conviction, be liable to a fine not exceeding five hundred thousand ringgit or to imprisonment for a term not exceeding three years or to both.
SECTION 248: DIRECTORS SHALL PREPARE FINANCIAL STATEMENTS.
(1) The directors of every company shall prepare financial statements-
(a) Within eighteen months from the date of its incorporation
(b) Subsequently, within six months of its financial year end.
(2) The financial statements referred to in subsection (1) shall be duly audited before the financial statements are sent to every member under section 257 and laid before an annual general meeting under section 340.
(3) Any director of the company who contravenes this section commits an offence and shall, on conviction, be liable to a fine not exceeding five hundred thousand ringgit or imprisonment for a term not exceeding one year or both,
SECTION 267: APPOINTMENT AUDITORS OF PRIVATE COMPANY.
(1) A private company shall appoint an auditor for each financial year of the company.
(2) Notwithstanding subsection (1), the Registrar shall have the power to exempt any private company from the requirement stated in that subsection according to the conditions as determined by the Registrar
(3) The Board shall appoint an auditor of the company-
(a) In the case of newly incorporated companies, at least thirty days before the end of the period for the submission of the first financial statements to the Registrar.
(b) To fill casual a casual vacancy in the office of auditor.
(4) The members shall appoint an auditor by ordinary resolution-
(a) In the case of subsequent years following the submission of its first financial statements, during the period for appointing auditor
(b) If the Board fails to appoint an auditor under subsection (3)
(5) An auditor of a private company shall only be appointed in accordance with subsection (3) or (4).
(6) For the purposes of subsection (4) the period for appointing auditors means the period of thirty days-
(a) Before the end of the period allowed for the lodgement of the previous year financial statements with the Registrar under subsection 259(1)
(b) If the previous year financial statements were lodged earlier, before the day on which financial statements were lodged with the Registrar.
(7) The company and every director of the company who contravene this section commit an offence.
SECTION 267: APPOINTMENT AUDITORS OF PRIVATE COMPANY.
(1) A private company shall appoint an auditor for each financial year of the company.
(2) Notwithstanding subsection (1), the Registrar shall have the power to exempt any private company from the requirement stated in that subsection according to the conditions as determined by the Registrar
(3) The Board shall appoint an auditor of the company-
(a) In the case of newly incorporated companies, at least thirty days before the end of the period for the submission of the first financial statements to the Registrar.
(b) To fill casual a casual vacancy in the office of auditor.
(4) The members shall appoint an auditor by ordinary resolution-
(a) In the case of subsequent years following the submission of its first financial statements, during the period for appointing auditor
(b) If the Board fails to appoint an auditor under subsection (3)
(5) An auditor of a private company shall only be appointed in accordance with subsection (3) or (4).
(6) For the purposes of subsection (4) the period for appointing auditors means the period of thirty days-
(a) Before the end of the period allowed for the lodgement of the previous year financial statements with the Registrar under subsection 259(1)
(b) If the previous year financial statements were lodged earlier, before the day on which financial statements were lodged with the Registrar.
(7) The company and every director of the company who contravene this section commit an offence.
SECTION 264: COMPANY AUDITORS.
(1) A person shall not-
(a) Knowingly consent to be appointed as an auditor for any company.
(b) Knowingly act as an auditor for any company
(c) Prepare, for or on behalf of a company, any report required by this Act to be prepared by an approved company auditor if-
(i) He is not an approved company auditor
(ii) He is indebted to the company or to a corporation that is deemed to be related to that company by virtue of section 7 in an amount exceeding twenty-five thousand ringgit.
(iii) He is-
(A) Or his spouse is an officer of the company.
(B) A partner, employer or employee of an officer of the company.
(C) A partner or employee of an employee of an officer of the company
(D) A shareholder or his spouse is a shareholder of a corporation whose employee is an officer of the company.
(iv) He is responsible for or if he is the partner, employer or employee of a person responsible for the keeping of the register of members or the register of member or the register of debenture holders of the company
(v) He is an undischarged bankrupt within or outside Malaysia except with leave of the Court
(vi) He has been convicted of any offence involving fraud or dishonesty punishable with imprisonment for three months or more.
(2) For the purposes of subparagraph (1)(c)(iii), a person shall be deemed to be an officer of a company if he is an officer of a corporation that is deemed to be related to the company by virtue of section 7 if he has been an officer or promoter of the company or such a corporation at any time within the preceding period of twelve months, unless the Minister directs otherwise.
(3) For the purposes of this section, a person shall not be deemed to be an officer by reason only of him having been appointed as an auditor of a corporation.
(4) A firm of auditors shall not knowingly consent to be appointed, and shall not knowingly act, as an auditor for any company and shall not prepare, for or on behalf of a company any report required by this Act to be prepared by an approved company auditor unless-
(a) All the partners of the firm resident in Malaysia are approved company auditors and here,the firm is not registered as a firm under any law for the time being in force, a return showing the full names and addresses of all the partners of the firm has been lodged with the Registrar.
(b) No partner of the firm is disqualified under subsection
(1) From acting as the auditor of the company.
(5) A company shall not appoint a person or a firm as an auditor unless prior to the appointment-
(a) That person has consented in writing to act as the auditor
(b) In the case of a firm, at least one partner of the firm has consented in writing.
(6) The appointment of a firm in the name of the firm as auditors of a company shall take effect as an appointment as auditors of the company of the persons who are partners of that firm at the time of the appointment.
(7) The appointment of a firm in the name of the limited liability partnership or foreign limited liability partnership as auditors of a company shall take effect as an appointment as auditors of the company as if-
(a) The partners of the limited liability partnership, whether the partners at the time the limited liability partnership was appointed as auditor or later
(b) Employees of the limited liability partnership who are approved company auditors in that limited liability partnership, whether employed at the time the limited liability partnership was appointed as auditor or later, are appointed as auditors of the company.
(8) Any person who is or any firm which is appointed as an auditor contravenes subsection (1) or (4) respectively commits an offence and shall, on conviction, be liable to fine not exceeding one hundred thousand ringgit.
A person shall not knowingly consent to be appointed as an auditor for any company to prepare, for or on behalf of a company, any report required by this Act to be prepared by an approved company auditor if-
He is not an approved company auditor and he is indebted to the company or to a corporation that is deemed to be related to that company by virtue of section 7 in an amount exceeding twenty-five thousand ringgit.
He is or his spouse is an officer of the company.
A partner, employer or employee of an officer of the company.
A partner or employee of an employee of an officer of the company
A shareholder or his spouse is a shareholder of a corporation whose employee is an officer of the company.
He is responsible for or if he is the partner, employer or employee of a person responsible for the keeping of the register of members or the register of member or the register of debenture holders of the company
He is an undischarged bankrupt within or outside Malaysia except with leave of the Court
He has been convicted of any offence involving fraud or dishonesty punishable with imprisonment for three months or more or the purposes of subparagraph (1)(c)(iii), a person shall be deemed to be an officer of a company if he is an officer of a corporation that is deemed to be related to the company by virtue of section 7 if he has been an officer or promoter of the company or such a corporation at any time within the preceding period of twelve months, unless the Minister directs otherwise.
For the purposes of this section, a person shall not be deemed to be an officer by reason only of him having been appointed as an auditor of a corporation.
A firm of auditors shall not knowingly consent to be appointed, and shall not knowingly act, as an auditor for any company and shall not prepare, for or on behalf of a company any report required by this Act to be prepared by an approved company auditor unless-
All the partners of the firm resident in Malaysia are approved company auditors and here,the firm is not registered as a firm under any law for the time being in force, a return showing the full names and addresses of all the partners of the firm has been lodged with the Registrar.
No partner of the firm is disqualified under subsection
From acting as the auditor of the company.
A company shall not appoint a person or a firm as an auditor unless prior to the appointment-
That person has consented in writing to act as the auditor
In the case of a firm, at least one partner of the firm has consented in writing.
The appointment of a firm in the name of the firm as auditors of a company shall take effect as an appointment as auditors of the company of the persons who are partners of that firm at the time of the appointment.
The appointment of a firm in the name of the limited liability partnership or foreign limited liability partnership as auditors of a company shall take effect as an appointment as auditors of the company as if-
The partners of the limited liability partnership, whether the partners at the time the limited liability partnership was appointed as auditor or later
Employees of the limited liability partnership who are approved company auditors in that limited liability partnership, whether employed at the time the limited liability partnership was appointed as auditor or later, are appointed as auditors of the company.
Any person who is or any firm which is appointed as an auditor contravenes subsection (1) or (4) respectively commits an offence and shall, on conviction, be liable to fine not exceeding one hundred thousand ringgit.
SECTION 276(1) – RESOLUTION TO REMOVE AUDITOR FROM OFFICE
(1) The members of the company may remove an auditor from office at anytime-
(a) by ordinary resolution at a general meeting
(b) in accordance with section 277
(2) This section shall not be taken as depriving the person removed of the compensation or damages payable to him in respect of the termination of his appointment as an auditor.
(3) An auditor may not be removed from office before the expiration of his term of office except by resolution under this section.
SECTION 277: SPECIAL NOTICE REQUIRED FOR RESOLUTION TO REMOVE AUDITOR FROM OFFICE.
277(1) A special notice shall be required for a resolution to remove an auditor from office at a general meeting of a company.
(2) Upon receipt of the special notice of such intended resolution, the company shall immediately send a copy of the notice to the auditor proposed to be removed and the Registrar.
(3) The auditor may make a representation in writing not exceeding a reasonable lenght to the company within seven days from the receipt of the special notice and may request that prior to the meeting at which the resolution is to be considered, a copy of the representation be circulated by the company to every member of the company to whom notice of the meeting is sent.
(4) Upon request of the auditor referred to in subsection (3), the company shall send a copy of the representation to every member of the company to whom notice of the meeting is sent.
95) If a copy of the representation is not sent as required under subsection (4), the auditor may, without prejudice to his right to be heard orally, require that the representation be read out at the meeting.
(6) A copy of the representation need not be circulated and representation need not to be read at the meeting if, on the application either of the company or of any other person claiming to be aggrieved, the Court is satisfied that the auditor is using this section to secure needless publicity or the matter is defamatory or some other grounds that the Court thinks reasonable.
SECTION 277: NOTICE TO REGISTRAR OF RESOLUTION TO REMOVE AUDITOR FROM OFFICE.
278(1) If a resolution is passed under section 276, the company shall give a notice of that fact to the Registrar within fourteen days.
(2) The company and every officer who contravene this section commit an offence.
SECTION 281: RESIGNATION OF AUDITOR.
281910 An auditor of a company may resign his office by giving a notice in writing to that effect to the company at its registered office.
(2) A notice of resignation under subsection (1) shall bring the auditor’s term of office to an end after twenty-one days from which the notice is given or from the date as may be specified in the notice.
SECTION 281: NOTICE OF RESIGNATION OF AUDITOR TO REGISTRAR.
282(1) Where an auditor resigns his office, the company shall send a copy of the notice to the Registrar within seven days from receiving of a notice of resignation.
(2) The company and every officer who contravene this section commit an offence.
S174(4)&(5)
Rights to access accounting book/records, vouchers, and other records of the company and its subsidiaries
Entitlement to require from any officer of the company and any auditor of a related company or of any subsidiaries, such information and explanation as he desires for the purpose of carrying out his duties
S174(7)
The entitlement to attend any general meeting of any company and to speak on any part of the business of that meeting that concern him in his capacity as auditor
Rights to receive all notices of any other communication relating to any general meeting in which a member entitled to receive
S172 (6)
Auditor has a right to be heard at the meeting
Statutory Duties (S174)
Duty to carry out audit
Duty to report to appropriate management
Duty to be independent
Duty to use reasonable care and skill
An auditor is under a duty to exercise the appropriate standard of care to shareholders and outsiders.
Any failure to do that may lead the auditor liable in an action for the tort of negligent
It was held that a firm of accountant was not liable to outsider investor who had relied on a negligently prepared report. This was because there was no contract between the accountants and outsider and they were under no duty of care.
Company Law In Malaysia
A company must have a minimum of one directors, being natural persons of full age and having their principal or only place of residence in Malaysia and not under bankruptcy .Directors need not be shareholders of the company. A director has onerous duties under the Companies Act 2016 as in common law. The duties of directors stipulated in the Companies Act 2016 are not exhaustive and generally directors are imposed with statutory duties, duty of care and fiduciary duties. In addition, directors are also governed by a Directors Code of Ethics.
SECTION 14: APPLICATION FOR INCORPORATION
(1) A person who desire to from a company shall apply for incorporation to the Registrar.
(2) A company shall not be formed for any unlawful purpose.
(3) The application for incorporation under this section shall include a statement by every person who desires to form a company containing the following particulars:
(a) The name of the proposed company
(b) The status of whether the company is private or public
(c) The nature of business of the proposed company
(d) The proposed address of the registered office of the proposed company
(e) The name identification, nationality and the ordinary place of residence of every person who is to be a member of the company and where any of these persons is a body corporate, the corporate name, place of incorporation, registration number and the registered office of the body corporate.
(f) The name, identification, nationality and the principal place of residence of every person who is to be a director.
(g) The name, identification, nationality and the principal place of residence of every person who is to be director.
(h) In the case of a company limited by shares the details of class and number of shares to be taken by a member.
(i) In the case of a company limited by guarantee the amount up to which the member undertakes to contribute to the assets of the company in the event of its being wound up and
(j) Any other information as the Registrar may require.
(4) The application for incorporation shall be accompanied by a statement from each promoter or director confirming-
(a) His consent to act as a promoter or to his appointment as a director as the case may be , and
(b) That he is not disqualified under this Act to act as a promoter or a director as the case may be.
SECTION 15: REGISTRATION FOR INCORPORATION
If the Registrar is satisfied that the requirements of this Act as to the application for incorporation are complied with and upon payment of the prescribed fee, the Registrar shall-
(a) Enter the particulars of the company in the register,
(b) Assign a registration number to the company as its company registration number and.
(c) Issue a notice of registration in the form and manner as the Registrar may determine.
SECTION 16: POWER TO REFUSE REGISTRATION OF INCORPORATION
(1) Without prejudice to the powers of the Registrar under section 15, the Registrar shall not register an application unless he is satisfied that all the requirements of this Act in respect of the registration and any matter relating to the registration has been complied with.
(2) The Registrar shall refuse to register the application of a proposed company where he is satisfied that the proposed company is likely to be used for an unlawful purpose or for purposes prejudicial to public order, morality or security of Malaysia.
SECTION 17: CERTIFICATE OF INCORPORATION
Upon an application by a company and on payment of a prescribed fee, the Registrar may issue to the company a certificate of incorporation in the form and manner as the Registrar may determine.
SECTION 18: EFFECT OF INCORPORATION
(1) Upon the date of incorporation specified in the notice of registration issue under section 15, there shall be a company by the name and registration number as stated in the principal register kept by the Registrar for this purpose.
(2) Every person whose name is stated as a member in the application for incorporation and on the incorporation of the company shall be entered member in the register of members, together with such there persons who my become members of the company from time to time , are a body corporate by the name stated in the notice of registration.
(3) In the case of company having a share capital, every person whose name is stated in the application for incorporation becomes the shareholder as specified in the application.
(4) The details of the registered office of the company are ass stated in, or in connection with, the application for registration.
(5) The person named in the statement as a director or a secretary if any shall be deemed to have been appointed to that office.
SECTION 19: NOTICE OF REGISTRATION AS CONCLUSIVE EVIDENCE.
The notice of registration is conclusive evidence that the requirements of this Act in respect of registration and matters precedent and incidental to such registration have been complied with and that the company is duly registered under this Act.
SECTION 21: COMPANIES HAVE UNLIMITED CAPACITY
(1) A company shall be capable of exercising all the functions of a body corporate and have the full capacity to carry on or undertake any business or activity including-
(a) To sue and be sued.
(b) To acquire, own, hold, develop or dispose of any property and
(c) To do any act which it may do or to enter into transactions
(2) A company shall have the full rights, powers and privileges for the purposes mentioned in subsection (1)
SECTION 197: PERSONS CONNECTED WITH DIRECTORS.
(1) A person shall be deemed to be connected with a director if the person is-
(a) A member of the director’s family
(b) A body corporate which is associated with that director
(c) A trustee of a trust, other than a trustee for an employee share scheme, under which that director or a member of the director’s family is a beneficiary or
(d) A partner of that director or a partner of a person connected with that director.
(2) For the purpose of this section-
(a) “a member of the director’s family” means the director’s spouse, parent, child, including adopted child and stepchild, brother, sister and the spouse of the director’s child, brother or sister.
(b) A body corporate is associated with a director if-
(i) The body corporate is accustomed or is under an obligation, whether formal or informal, or the majority of directors of the body corporate is accustomed to act in accordance with the directions, instructions or wishes of the director.
(ii) That director has a controlling interest in the body corporate
(iii) That director, or persons connected with that director, or that director and persons connected with him, are entitled to exercise, or control the exercise of, not less than twenty per centum of the votes attached to voting shares in the body corporate.
SECTION 198: PERSONS DISQUALIFIED FROM BEING A DIRECTOR.
(1) A person shall not hold office as a director of a company or whether directly or Indirectly be concerned with or takes part in the management of a company , if the person-
(a) Is an undischarged bankrupt
(b) Has been convicted of an offence relating to the promotion, formation or management of a corporation.
(c) Has been convicted of an offence involving bribery fraud or dishonesty
(d) Has been convicted of an offence under sections 213,217,218,228 and 539
(e) Has been disqualified by the Court under section 199
(2) The circumstances referred to in paragraph (1)(a), (b), (c) and (d) shall be applicable to circumstances in or outside Malaysia.
(3) Notwithstanding subsection (1), a person who has been disqualified under paragraph (1)(a) may be appointed or hold office as a director with the leave of-
(a) The official Receiver or
(b) The Court provided that a notice of intention to apply for leave has been served on the Official Receiver and the Official Receiver is heard on the application.
(4) Notwithstanding subsection (1), a person who has been disqualified under paragraph
(1)(b),(c),(d) or (e) may be re-appointed or hold office as a director with the leave of the Court.
(5) A person intending to apply for a leave of the Court under paragraph (3)(b) or subsection(4) shall-
(a) Give the Registrar a notice of not less than fourteen days of the person’s intention to do so and
(b) Make the Registrar a party to the proceedings under subsection (3)
(6) For the purposes of subsection (5), any person referred to in paragraph (1)(b), (c), (d) or (e) shall not be required to obtain a leave from Court after the expiry of five years calculated from the date he is convicted or if he is sentenced to imprisonment from the date of his release from prison.
(7) Any person who contravenes this section commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding one million ringgit or to both.
Ready made company are companies which has been fully registered under the Companies Act 2016,
Our registered companies was incorporated under the Registrar Of Companies by using our own capital, promoters and subscribers. These companies is not carried on any business transaction or no business activity was been done since from the date of it incorporation.
These companies can be transfer immediately and you can start your business simply. The company registration certificate has already been issued by The Companies Commission Malaysia (CCM).
These companies are normally dormant and registered under directors and shareholders from Malaysia. The existing directors and shareholders will be replaced with new directors and shareholders of your choice and all the company documents will be given once the transferring ownership submitted to the Registrar.
The directors can start to trade with the existing company name or can request to change the company name under their own choice. A registered Company has the same characteristics as a normal newly incorporated company.
Client can chose to buy company from our company list and we will restructure the company by transferring ownership and to appoint directors as instructed and to amend any details they want to do through our company secretary.
All registered company incorporated with 2 shares of RM1.00 each.
For you information all our ready made companies can be purchased immediately and allowed to be booked not more than 24 hours and full payment must be make upon confirmation to purchase is made.
Company statutory documents can be deliver by post or through e.mail immediately after we received the payment and original documents will be dispatched accordingly to enable the company to start the business operations.
(1) The name of the company (whether or not it is carrying on business under a business name) in legible romanized letters and the company number of the company shall appear on-
(a) its seal; and (b) all business letters, statements of account, invoices, official notices, publications, bills of exchange, promissory notes, endorsements, cheques, orders, receipts and letters of credit of or purporting to be issued or signed by or on behalf of, the company, and if default is made in complying with this subsection the company shall be guilty of an offence against this Act.
(1A) Where a company has changed its name pursuant to section 23, the former name of the company shall also appear beneath its present name on all documents, business letters, statements of account, invoices, official notices, publications, bills of exchange, promissory notes, endorsements, cheques, orders, receipts and letters of credit of, or purporting to be issued or signed by or on behalf of, the company for a period of not less than twelve months from the date of the change, and if default is made in complying with this subsection the company shall be guilty of an offence against this Act.
(2) If an officer of a company or any person on its behalf-
(a) uses or authorizes the use of any seal purporting to be a seal of the company where on its name does not so appear;
(b) issues or authorizes the issue of any business letter, statement of account, invoice, official notice or publication of the company wherein its name and former name (if applicable) is not so mentioned; or
(c) signs issues or authorizes to be signed or issued on behalf of the company any bill of exchange, promissory note, cheque or other negotiable instrument or any endorsement, order, receipt or letter of credit wherein its name and former name (if applicable) is not so mentioned, he shall be guilty of an offence against this Act, and where he has signed, issued or authorized to be signed or issued on behalf of the company any bill of exchange, promissory note or other negotiable instrument or any endorsement thereon or order wherein that name and former name (if applicable) is not so mentioned, he shall in addition be liable to the holder of the instrument or order for the amount due thereon unless it is paid by the company.
SECTION 30: PUBLICATION OF NAME
(1) A company shall display its registered name and company registration number at-
(a) Its registered office
(b) Every place where its business is carried on and
(c) Every place where its books are kept.
(2) A company shall disclose its registered name and company registration number on-
(a) Its business letters, notice and other official publications, including in electronic from
(b) Its websites
(c) Its bills of exchange, promissory notes, endorsements and order forms.
(d) Cheques purporting to be signed by or on behalf of the company.
(e) Orders invoices and other demands for payment receipts and letter of credit purporting to be issued or signed by or on behalf of the company and
(f) All other forms of its business correspondence and documentation.
(3) The Registrar shall determine the manner a registered name is to be displayed or disclosed by a company.
(4) For the purposes of subsection (2), where a company changed its name under section 28 or 29, the former name of the company shall appear beneath its present registered name for a period of not less than twelve months from the date of the change.
(5) The company and every officer who contravene this section commit an offence.
A company shall at all times have registered office in Malaysia to which all communications and notices may be addressed. The registered office shall be open and accessible to the public during ordinary business hour.
The Registrar shall be notified of any change in the address of the registered office within fourteen days of such change. The company and every officer who contravene this section commit an offence and shall, on conviction, be liable to a fine not exceeding fifty thousand ringgit.
SECTION 2 : INTERPRETATION
(1) In this Act, unless the context otherwise requires-
“accounting records” in relation to a corporation, includes invoices, receipts ,orders for payment of money , bills of exchange, chequs, promissory notes, vouchers and other documents of prime entry and also includes such working papers and other documents as are necessary to explain the methods and calculations by which accounts are prepared.
“Annual general meeting”, in relation to a public company, means a meeting of the company required to be held by section 340.
“Annual return” means the return required to be lodged under section 68, and includes ay document accompanying the return.
“Approved company auditor” means a person who has been approved under section 263 as an auditor and whose approval has not been revoked.
“Approved liquidator” means a person who has been approved under section 433 ass liquidator and whose approval has not been revoked.
Banking corporation” means a licensed bank, licensed investment bank, licensed Islamic bank and licensed international Islamic bank.
“Beneficial owner” means the ultimate owner of the shares and does not include a nominee of any description.
“Board”, in relation to a company, means-
(a) Directors of the company who number not less than the required quorum acting as a board of directors, or
(b) If the company has only one director, that director
“Books” includes any register or other record of information and any accounts and accounting records, however compiled, recorded or stores and also includes any document.
“Directors’ includes any person occupying the position of director of a corporation by whatever name called and includes a person in accordance with whose directions or instructions the majority of directors of a corporation are accustomed to act and an alternate or substitute director.
“exempt private company” means a private company in the shares of which no beneficial interest is held directly or indirectly by any corporation and which has not more than twenty members none of whom is a corporation.
“Financial statements” has the same meaning as set out in the approved
accounting standards issued or approved by the Malaysia Accounting Standard Board under the Financial Reporting Act 1997.
“Financial year” means the period in respect of which any financial statement of a corporation is made up whether that period is a year or not.
“Officer”, in relation to a corporation, includes-
(a) Any director, secretary or employee of the corporation.
(b) A receiver and manager of any part of the undertaking of the corporation appointed under power contained in any instrument and
(c) Any liquidator of a company appointed in a voluntary winding up. But does not include –
(i) Any receiver who is not also a manager
(ii) Any receiver and manager appointed by the Court or
(iii) Any liquidator appointed by the Court or by the creditors.
”preference share” mean a share by whatever name called, which does not entitle the holder to the right to vote on a resolution or to any right to participated beyond a specified amount in any distribution whether by way of dividend or on redemption, in a winding up, or otherwise.
“Profit and loss account” includes income and expenditure account, revenue account or any other account showing the results of the business of a corporation for a period.
“Promoter”, in relation to prospectus issued by or in connection with a corporation, means a promoter of the corporation who was a party to the preparation of the prospectus or of any relevant portion of the prospectus, but does not include any person by reasons only of his acting in a professional capacity.
“Service address”, in relation to a director, means an address, electronic or otherwise, provided to the company to which any communication may be sent.
“Share” means issued share capital of a corporation and includes stock except where a distinction between stock and shares is expressed or implied.
“Annual return” means the return required to be lodged under section 68, and includes any document accompanying the return.
SECTION 54: PLACE WHERE REGISTER OF MEMBERS AND INDEX TO BE KEPT
(1) The register of members and index shall be kept at the registered office of the company,but-(a) If the register and index are prepared at another office of the company within Malaysia, the register and index may be kept at that other office or
(b) If the company arranges with any person to prepare the register and index on its behalf the register and index may be kept at the office of that person at which the work is done if that office is within Malaysia.
(2) Where, by virtue of paragraph (1)(b), the register of member is kept at the office of that agent other than the company and by reason of his default the company contravenes subsection (1) or any requirements of this Act as to the production of the register, the agent shall be liable to the same penalties as if he were an officer of the company, and the power of the Court under section 585 shall extend to the making of orders against the agent and officers and servants of the agent.
(3) The company ad every officer who contravene this section commit an offence and shall on conviction, be liable to a fine not exceeding ten thousand ringgit and in the case of a continuing offence, to a further fine not exceeding five hundred ringgit for each day during which the offence continues after conviction.
(a) a company, corporation, society, association or other body incorporated outside Malaysia; or(b) an unincorporated society, association or other body which under the law of its place of origin may sue or be sued, or hold property in the name of the secretary or other officer of the body or association duly appointed for that purpose and which does not have its head office or principal place of business in Malaysia;
“guarantor corporation”, in relation to a borrowing corporation, means a corporation that has guaranteed or has agreed to guarantee the repayment of any money received or to be received by the borrowing corporation in response to an invitation to the public to subscribe for or purchase debentures of the borrowing corporation;
“limited company” means a company limited by shares or by guarantee or both by shares and guarantee;
“liquidator” includes the Official Receiver when acting as the liquidator of a corporation;
“lodged” means lodged under this Act or any corresponding previous written law;
“manager”, in relation to a company, means the principal executive officer of the company for the time being by whatever name called and whether or not he is a director;
“marketable securities” means debentures, funds, stocks, shares or bonds of any Government or of any local authority or of any corporation or society and includes any right or option in respect of shares in any corporation and any interest as defined in section 84;
“members’ voluntary winding up” means a winding up under Division 3 of Part X, where a declaration has been made and lodged in pursuance of section 257;
“memorandum” means memorandum of association;”minimum subscription”—
(a) in relation to any shares of an unlisted recreational club which are offered to the public for subscription, means the amount stated in the prospectus relating to the offer in pursuance of paragraph
4(a) of the Fifth Schedule;(b) in relation to any issue of, offer for subscription or purchase of, or invitation to subscribe for or purchase, shares made pursuant to the Securities Commission Act 1993 [Act 498], means the amount stated in the prospectus relating to the issue, offer or invitation in pursuance of the requirements of the Securities Commission relating to contents of prospectuses, as the minimum amount which in the opinion of the directors must be raised by the issue of the shares so offered;
“Minister” means the Minister charged with the responsibility for companies;”office copy”, in relation to any Court order or other Court document, means a copy authenticated under the hand or seal of the Registrar or other proper officer of the Court;
“officer” in relation to a corporation includes
(a) any director, secretary or employee of the corporation;(b) a receiver and manager of any part of the undertaking of the corporation appointed under a power contained in any instrument; and(c) any liquidator of a company appointed in a voluntary winding up,
but does not include
(d) any receiver who is not also a manager;(e) any receiver and manager appointed by the Court; or(f) any liquidator appointed by the Court or by the creditors;
“Official Receiver” means the Director General of Insolvency, Deputy Director General of Insolvency, Senior Assistant Directors of Insolvency, Assistant Directors of Insolvency, Insolvency officers and any other officer appointed under the Bankruptcy Act 1967 [Act 360];
“preference share” means a share by whatever name called, which does not entitle the holder thereof to the right to vote at a general meeting or to any right to participate beyond a specified amount in any distribution whether by way of dividend, or on redemption, in a winding up, or otherwise;
“prescribed” means prescribed by or under this Act;
“principal register”, in relation to a company, means the register of members of the company kept in pursuance of section 158;
“printed” includes typewritten or lithographed or reproduced by any mechanical means;
“private company” means
(a) any company which immediately prior to the commencement of this Act was a private company underthe repealed written laws;(b) any company incorporated as a private company by virtue of section
15; or(c) any company converted into a private company pursuant to section 26(1), being a company which has not ceased to be a private company under section 26 or 27;
“profit and loss account” includes income and expenditure account, revenue account or any other account showing the results of the business of a corporation for a period;
“promoter”, in relation to a prospectus issued by or in connection with a corporation, means a promoter of the corporation who was a party to the preparation of the prospectus or of any relevant portion thereof; but does not include any person by reason only of his acting in a professional capacity;
“prospectus” means any prospectus, notice, circular, advertisement or invitation inviting applications or offers from the public to subscribe for or purchase or offering to the public for subscription or purchase any shares in or debentures of or any units of shares in or units of debentures of a corporation or proposed corporation and, in relation to any prospectus registered under the Securities Commission Act 1993, means a prospectus as defined under that Act;
“public company” means a company other than a private company;
“registered” means registered under this Act or any corresponding previous written law;
“Registrar” means the Registrar of Companies as designated under subsection 7(1);
“regulations” means regulations under this Act;
“related corporation”, in relation to a corporation, means a corporation which is deemed to be related to the first-mentioned corporation by virtue of section 6;
“repealed written laws” means the written laws repealed by this Act;
“resolution for voluntary winding up” means the resolution referred to in section 254;
“rules” means rules of court;
“securities” has the same meaning as is assigned to that word in the Securities Commission Act 1993;
“share” means share in the share capital of a corporation and includes stock except where a distinction between stock and shares is expressed or implied;
“statutory meeting” means the meeting referred to in section 142;
“statutory report” means the report referred to in section 142;
“Subdivision” means a Subdivision of this Act and a reference to a specified subdivision is a reference to that Subdivision of the Division in which the reference occurs;
“Table A” means Table A in the Fourth Schedule;
“this Act” includes any regulations;
“transparency”, in relation to a document, means
(a) a developed negative or positive photograph of that document (in this definition referred to as an “original photograph”) made on a transparent base, by means of light reflected from or transmitted through the document;
(b) a copy of an original photograph made by the use of photo-sensitive material (being photo-sensitive material on a transparent base) placed in surface contact with the original photograph; or
(c) any one of a series of copies of an original photograph, the first of the series being made by the use of photosensitive material (being photo-sensitive material on a transparent base) placed in surface contact with a copy referred to in paragraph
(d), and each succeeding copy in the series being made, in the same manner from any preceding copy in the series;
(a) a company registered as a trust company under the Trust Companies Act 1949 [Act 100]; or(b) a corporation that is a public company under this Act or under the laws of any other country, which has been declared by the Minister to be a trustee corporation for the purposes of this Ac
“unit”, in relation to a share, debenture or other interest, means any right or interest therein, by whatever term called;
“unlimited company” means a company formed on the principle of having no limit placed on the liability of its members;
“unlisted recreational club” has the same meaning as is assigned to that expression in the Securities Commission Act 1993;
“voting share”, in relation to a body corporate, means an issued share of the body corporate, not being
(a) a share to which, under no circumstances, there is attached a right to vote; or(b) a share to which there is attached a right to vote only in one or more of the following circumstances:
(i) during a period in which a dividend (or part of a dividend) in respect of the share is in arrears;
(ii) upon a proposal to reduce the share capital of the body corporate;
(iii) upon a proposal affecting the rights attached to the share;
(iv) upon a proposal to wind up the body corporate;
(v) upon a proposal for the disposal of the whole of the property, business and undertakings of the body corporate;
(vi) during the winding up of the body corporate.
(1A) In this Act—
(a) “licensed bank”, “licensed business”, “licensed discount house”, “licensed finance company”, “licensed institution”, “licensed merchant bank”, “licensed money broker”, “nonscheduled institution”, “scheduled business” and “scheduled institution” shall have the meanings assigned thereto in subsection 2(1) of the Banking and Financial Institutions Act 1989 [Act 372]; and
(b) “Islamic bank” or “Islamic banking business” shall have the meaning assigned thereto in the Islamic Banking Act 1983 [Act 276].
(2) For the purposes of this Act a person shall not be regarded as a person in accordance with whose directions or instructions the directors of a company are accustomed to act by reason only that the directors act on advice given by him in a professional capacity.
(3) For the purposes of this Act a statement included in a prospectus or statement in lieu of prospectus shall be deemed to be untrue if it is misleading in the form and context in which it is included.
(4) For the purposes of this Act a statement shall be deemed to be included in a prospectus or statement in lieu of prospectus if it is contained in any report or memorandum appearing on the face thereof or by reference incorporated therein or issued therewith.
(5) For the purposes of this Act any invitation to the public to deposit money with or to lend money to a corporation shall be deemed to be an invitation to subscribe for or purchase debentures of the corporation and any document that is issued or intended or required to be issued by a corporation acknowledging or evidencing or constituting an acknowledgement of the indebtedness of the corporation in respect of any money that is or may be deposited with or lent to the corporation in response to such an invitation shall be deemed to be a debenture, but an invitation to the public by a prescribed corporation as defined in subsection 38(7) shall not be deemed to be an invitation to the public to deposit money with or to lend money to the corporation for the purpose of Division 4 of Part IV.
(6) Any reference in this Act to offering shares or debentures to the public shall, unless the contrary intention appears, be construed as including a reference to offering them to any section of the public, whether selected as clients of the person issuing the prospectus or in any other manner; but a bona fide offer or invitation with respect to shares or debentures shall not be deemed to be an offer to the public if it is—
(a) an offer or invitation to enter into an underwriting agreement;
(b) made to a person whose ordinary business it is to buy or sell shares or debentures whether as principal or agent;
(c) made to existing members or debenture holders of a corporation and relates to shares in or debentures of that corporation and is not an offer to which section 46 of the Securities Commission Act 1993 applies; or
(d) made to existing members of a company within the meaning of section 270 and relates to shares in the corporation within the meaning of that section.
(7) Unless the contrary intention appears any reference in this Act to a person being or becoming bankrupt or to a person assigning his estate for the benefit of his creditors or making an arrangement with his creditors under any written law relating to bankruptcy or to a person being an undischarged bankrupt or to any status, condition, act, matter or thing under or in relation to the law of bankruptcy shall be construed as including a reference to a person being or becoming bankrupt or insolvent or to a person making any such assignment or arrangement or to a person being an undischarged bankrupt or insolvent or to the corresponding status, condition, act, matter or thing (as the case requires) under any written law relating to bankruptcy or insolvency.
Power of Companies in Malaysia
1. To carry on any other business which may seem to the company capable of being conveniently carried on in connection with its business or calculated directly or indirectly to enhance the value of or render profitable any of the company’s property or rights.
2. To acquire and undertake the whole or any part of the business, property, and liabilities of any person or company carrying on any business which the company is authorized to carry on, or possessed of property suitable for the purposes of the company.
3. To apply for, purchase, or otherwise acquire any patents, patent rights, copyrights, trade marks, formulas, licenses, concessions, and the like, conferring any exclusive or non-exclusive or limited right to use, or any secret or other information as to, any invention which may seem capable of being used for any of the purposes of the company, or the acquisition of which may seem calculated directly or indirectly to benefit the company; and to use, exercise, develop, or grant licenses in respect of, or otherwise turn to account, the property, rights, or information so acquired.
4. To amalgamate or enter into partnership or into any arrangement for sharing of profits, union of interest, co-operation, joint adventure, reciprocal concession, or otherwise, with any person or company carrying on or engaged in or about to carry on or engage in any business or transaction which the company is authorized to carry on or engage in, or any business or transaction capable of being conducted so as directly or indirectly to benefit the company.
5. To take, or otherwise acquire, and hold, shares, debentures, or other securities of any other company.
6. To enter into any arrangements with any Government or authority, supreme, municipal, local, or otherwise, that may seem conducive to the company’s objects, or any of them; and to obtain from any such Government or authority any rights, privileges, and concessions which the company may think it desirable to obtain; and to carry out, exercise, and comply with any such arrangements, rights, privileges, and concessions.
7. To establish and support or aid in the establishment and support of associations, institutions, funds, trusts, and conveniences calculated to benefit employees or directors or past employees or directors of the company or of its predecessors in business, or the dependents or connections of any such persons; and to grant pensions and allowances, and to make payments towards insurance; and to subscribe or guarantee money for charitable or benevolent objects, or for any exhibition, or for any public, general, or useful object.
8. To promote any other company or companies for the purpose of acquiring or taking over all or any of the property, rights, and liabilities of the company, or for any other purpose which may seem directly or indirectly calculated to benefit the company.
9. To purchase, take on lease or in exchange, hire, and otherwise acquire any movable or immovable property and any rights or privileges which the company may think necessary or convenient for the purposes of its business, and in particular any land, buildings, easements, machinery, plant, and stock in trade.
10. To construct, improve, maintain, develop, work, manage, carry out, or control any buildings, works, factories, mills, roads, ways, tramways, railways, branches or sidings, bridges, reservoirs, watercourses, wharves, warehouses, electric works, shops, stores, and other works and conveniences which may seem calculated directly or indirectly to advance the company’s interests; and to contribute to, subsidies, or otherwise assist or take part in the construction, improvement, maintenance, development. working, management, carrying out, or control thereof.
11. To invest and deal with the money of the company not immediately required in such manner as may from time to time be thought fit.
12. To lend and advance money or give credit to any person or company; to guarantee and give guarantees or indemnities for the payment of money or the performance of contracts or obligations by any person or company; to secure or undertake in any way the repayment of moneys lent or advanced to or the liabilities incurred by any person or company; and otherwise to assist any person or company.
13. To borrow or raise or secure the payment of money in such manner as the company may think fit and to secure the same or the repayment or performance of any debt, liability, contract, guarantee or other engagement incurred or to be entered into by the company in any way and in particular by the issue of debentures perpetual or otherwise, charged upon all or any of the company’s property (both present and future), including its uncalled capital; and to purchase, redeem, or pay off any such securities.
14. To remunerate any person or company for services rendered, or to be rendered, in placing or assisting to place or guaranteeing the placing of any of the shares in the company’s capital or any debentures, or other securities of the company, or in or about the organization, formation, or promotion of the company or the conduct of its business.
15. To draw, make, accept. endorse, discount, execute, and issue promissory notes, bills of exchange, bills of lading, and other negotiable or transferable instruments.
16. To sell or dispose of the undertaking of the company or any part thereof for such consideration as the company may think fit, and in particular for shares, debentures, or securities of any other company having objects altogether or in part similar to those of the company.
17. To adopt such means of making known and advertising the business and products of the company as may seem expedient.
18. To apply for, secure, acquire by grant, legislative enactment, assignment, transfer, purchase, or otherwise, and to exercise, carry out, and enjoy any charter, license, power, authority, franchise, concession, right, or privilege, which any Government or authority or any corporation or other public body may be empowered to grant; and to pay for, aid in, and contribute towards carrying the same into effect; and to appropriate any of the company’s shares, debentures, or other securities and assets to defray the necessary costs, charges, and expenses thereof.
19. To apply for, promote, and obtain any statute, order, regulation or other authorization or enactment which may seem calculated directly or indirectly to benefit the company; and to oppose any bills, proceedings, or applications which may seem calculated directly or indirectly to prejudice the company’s interests.
20. To procure the company to be registered or recognized in any country or place outside Malaysia.
21. To sell, improve, manage, develop, exchange, lease, dispose of, turn to account, or otherwise deal with all or any part of the property and rights of the company.
22. To issue and allot fully or partly paid shares in the capital of the company in payment or part payment of any movable or immovable property purchased or otherwise acquired by the company or any services rendered to the company.
23. To distribute any of the property of the company among the members in kind or otherwise but so that no distribution amounting to a reduction of capital shall be made without the sanction required by law.
24. To take or hold mortgages, liens, and charges to secure payment of the purchase price, or any unpaid balance of the purchase price, of any part of the company’s property of whatsoever kind sold by the company, or any money due to the company from purchasers and others.
25. To carry out all or any of the objects of the company and do all or any of the above things in any part of the world and either as principal, agent, contractor, or trustee, or otherwise, and by or through trustees or agents or otherwise, and either alone or in conjunction with others.
26. To do all such other things as are incidental or conducive to the attainment of the objects and the exercise of the powers of the company.
FAQ About Company Law In Malaysia
S5(1)(a)- Deemed to be a subsidiary of a holding company if the holding co. with respect to the subsidiary, if the holding company:
a) Controls the composition of the BOD of the subsidiary company
b) Controls more than half of the voting power of the subsidiaries
c) Controls more than half of the issued share capital of the subsidiaries
S5(1)(b) – a corporation is also deemed to be a subsidiary if it is a subsidiary of a holding company that itself a subsidiary.
S5A – A corporation is an ultimate holding company of another corporation if:
a. That other corporation is a sub is that holding company
b. The holding company is not itself a subsidiary of another
S5B- A corporation is wholly owned subsidiary if none of its members is a person other than
a. Its holding company
b. A nominee of its holding company
c. Another wholly owned subsidiary of the holding company, or
d. Nominee of such a wholly owned subsidiary
S6 – Corporation is deemed to be related to each other where a corporation:
a. Is the holding company of another corporation
b. Is a subsidiary of another corporation
c. Is a subsidiary of the holding company of another corporation
S4(1) – Foreign Company means:
a. A company, corporation, society, association, or other body incorporated outside Malaysia
b. An incorporated society, association or other body which under the law of its place of origin may sue and be sued, or hold property in the name of the secretary or other officer of the body of or association duly appointed for that purpose and which does not have its head office or principal place of business in Malaysia.
There are two types of winding up:
a. Compulsory Winding Up
It is a winding up by an order of the court which is initiated by the presentation of a petition by a person who is entitled to do so.
b. Voluntary Winding
A voluntary winding up should commence where a provisional liquidator has been appointed before the resolution for voluntary winding up was passed and in any other case, at the time of passion of the resolution for voluntary winding up. S255(6)
There are a few circumstances in which company may be wound up by court.
(1) The court may order the winding up if: (MC DOS D)
(a) The company has by special resolution resolved that it be wound up by the Court
(b) The company has defaulted in lodging the statutory report or in holding the statutory meeting
(c) The company does not commence business within a year from its incorporation or suspends its business for a whole year
(d) The number of members is reduced below two
(e) The company is unable to pay its debt
(f) The Directors have acted in their own interests rather than in the interests of the members as a whole, or in any other manner whatsoever which appears to be unfair or unjust to other member.
Two things to be shown before the court will make a winding up order on a petition are:
a. That the petitioner had the right to present the petition
b. That one of the grounds set out in the Acts as justifying a winding up has been made out.
A company is deemed to be unable to pay its debt if any one of the following circumstances is shown to exist:
a. The petitioner has delivered to the company at its registered office, a written demand for payment of all debt owing to him of at least RM500 and within the ensuing three weeks, the company has neither paid the debt nor given security for the payment
b. A judgment has been obtained against the company for the debt and an attempt to obtain payment out of the company’s assets remain unsatisfied, or
c. The court is satisfied that the company is unable to pay its debt.
Section 27(1) of CA 1965 provides that the following persons may petition for the winding up of a company:
a. The company itself
b. Any creditor, including a contingent or prospective creditor of the company
c. A contributor or any person who is the personal representative of a deceased contributory or the trustee in bankruptcy or the Official Assigner of the estate of a bankrupt contributory.
d. The liquidator
e. The minister pursuant to section 205 or on the ground specified in section 218(1)(d)
f. Bank Negara Malaysia
g. The registrar on the grounds specified in section 218(1)(m) or (n)
Contributory include every person liable to contribute to the assets of the company in the events of its being wound up.
It includes the present members and certain past members of the company
It has been held that a holder of fully paid up share is a contributory and entitled to present a petition.
Section 217(2) provides exceptions whereby contributory may not present a petition on any of the grounds specified in section 218(a),(b),(c),(e) or (l) unless
a. The number of members is reduced below two, or
b. The shares allocated to the contributor, or have been held by him and registered in his name at least 6 months during the 18 months before the presentation of the petition or have devolved on him through the death or bankruptcy of a former holder.
It happened where a provisional liquidator has been appointed before the resolution for voluntary winding up was passed and in any other case, at the time of passion of the resolution for voluntary winding up (S255(6)).
The resolution may be of two types:
a. Ordinary resolution
It passed when the articles provide that the company is to be wound up when a specified purpose has been achieved or a specified period has elapsed.
b. Special Resolution
It requires no ground for winding up and is used in any other case such as a solvent liquidation.
Two types of voluntary winding up are:
a. Member Voluntary Winding Up – where the company is solvent
b. Creditor Voluntary Winding Up – where the company is insolvent
If an order is made it is retrospective in effect to the date on which the petition was presented to their court which becomes the date of commencement of liquidations (S219(2))
Among the legal consequences of an order court for winding up are:
a. The effective dismissal of the directors and employees
b. A stay of any execution of a judgment against the company and of any legal proceeding in which it is either plaintiff or defendant.
c. A standstill on any disposition of assets or transfer of shares (unless approved by the court) from the date of commencement of liquidation S226.
a. Application by the company
Section 217(1)(a)
Allows the company to apply to have itself compulsorily wound up. The general meeting is the appropriate organ to determine that the company be wound up.
Application by a company for its compulsory winding up is quite rare. Usually, if the members wish to liquidate their company, they will do so by a voluntary winding up. A voluntary winding up does not involve a court hearing and so is cheaper.
On the other hand, a voluntary winding up can only be initiated by a special resolution which requires 3 quarters majority, whereas under S217(1)(a), a compulsory winding up only requires an ordinary resolution.
In some circumstances, the members may desire to place the company into liquidation as quickly as possible.
If this is the case, a compulsory winding up may be preferred over a members’ winding up, because meetings at which ordinary resolutions are to be proposed require less notice than meetings at which it is proposed to pass special resolution
b. Application by the creditors as a ground for compulsory liquidation
Section 218(1)(e)
Usually the vast majority of applications for compulsory winding up are presented by creditors on the grounds, i.e. the company is unable to pay its debt
S217(1)(b)
Permits a creditor, a contingent or a prospective creditor to apply for a compulsory winding up. This section enables creditors to apply for a compulsory winding up even though their debts are not immediately due and payable at the date of application
– Case: RE William Ltd
It was held that a person who is owed a debt by the company, which is still unpaid at the date of the application for winding up is a creditor
c. Application by the contributories as a ground for liquidation (S217(1)(C)
Section 4 (1) defines a contributory to includes
a. A person liable as a member or past member to contribute to the assets of the company in the event of winding up
b. A holder of a fully paid shares in the company
This definition of a contributory, in the case of a company limited by shares, includes persons who at the commencement of the winding up, held either fully paid or partly paid,even though strictly speaking, only a holder of partly paid, is able to contribute an amount on the winding up. Not only the contributories must hold the shares, their names must also be entered in the register of membership.
S214 (1)
– Past members may also be liable to contribute to the assets of a company if they were members within one year of the commencement of winding up and the present members are unable to satisfy the full extent of their liabilities.
– E.g. past member ceased to be a member for 1 or more years before the commencement of the winding up (a) till (g)
S215
A contributory’s liabilities is that of a specialty debt. This diminishes the effect of the statute of limitations as a specialty debt can be enforced within 20 years of the liquidator making the call. The debt accrues from the contributory at the time that he or she is liable and becomes payable at the time when calls are made to enforce the liability.
Contributory include every person liable to contribute to the assets of the company in the events of its being wound up.
It includes the present members and certain past members of the company
It has been held that a holder of fully paid up share is a contributory and entitled to present a petition.
Section 217(2) provides exceptions whereby contributory may not present a petition on any of the grounds specified in
section 218(a),(b),(c),(e) or (l) unless
a. The number of members is reduced below two, or
b. The shares allocated to the contributor, or have been held by him and registered in his name at least 6 months during the 18 months before the presentation of the petition or have devolved on him through the death or bankruptcy of a former holder.
a. Ordinary shares
Also known as equity shares
– Typically carry normal rights without special definitions
– Equity = Net value of real property= Appraised Property Value-unpaid debts
b. Preference Shares
S4 Of CA1965
It is a share which does not entitle the holder thereof to vote at general meeting or to participate beyond a specified amount in any distributions, whether by way of dividend or redemption in a winding up or otherwise
– Also known as preferred shares
– Typically a higher ranking share than ordinary share
– May or may not carry voting right
– Will paid out in assets before the common stockholders after debt holders in winding up
c. Redeemable shares
Are those shares that carry a right by the company to buyback the shares
It stated that the amount of capital which a company proposes to be registered must be stated in the MOA which called authorized capital and the company cannot allot shares more than authorized in its MOA. Any such allotment is void.
S62 of CA 1965
– A company may alter its authorized capital in general meeting by the creation of new shares or consolidated or divide all or any of its shares capital into shares of larger amount
S62(1)(C) of CA 1965
– Fully paid up shares may also be converted into stock. Stock unlike shares, it does not exist as discrete unit but as fund
S99(1) of CA 1965
– Shares must be numbered but stock need not be
a. Authorized share capital
– It is the amount which the company can issue
– S18(1) Required all companies except unlimited state in MOA amount of share capital.
b. Issued share capital
– It is the nominal value of share capital that actually issued.
– For example, 100 authorized capital of which 50 RM1 share have been issued
c. Reserve or uncalled capital
– A company may issue share and not receive the full par value immediately
– The share issued may be partly paid (paid-up capital)
– The amount unpaid called reserved @ uncalled capital
Company Statutory Records And Annual Returns
Register of Directors,Managers and secretaries – Section 141 (6)
Every company must keep at its registered office a register of its directors,managers and secretaries containing all particulars in the register as mentioned below:-
Set Company Register Book
The Register Of Members (Section 158)
The Register Of Directors, Managers And Secretaries (Section 141)
The Register Of Debenture Holders (Section 70)
The Register Of Charges (Section 115)
The Register of Accounts (Section 167)
The Register Of Substantial Shareholdings, Debentures and interests (Section 69L) – for Public Company only.
Set Of Minute Book
The Minute Books of proceedings of General Meetings and meetings of its directors and of its managers (if any) (Section 156)
Set Of Pre-Printed Shares Certificates Book
Set Of Company Common Seal.
Every Company having a share capital is required by section 165 of The Companies Act,1965 to prepare an annual return, which must be made up to the date of the Annual General Meeting (AGM) of the company in the year, or a date not later than 14th day after the date of the AGM.
The annual return, accompanied by a certificate and a list of members, signed by a director, or by the manager or secretary of the company, must be lodged in duplicate with Companies Commission Malaysia (CCM) within one month after the AGM.
First AGM to be held within 18 months of incorporation
Held once every calendar year
Periods between two AGMs must not be more that 15 months after the preceding AGM.
An annual return should be accompanied by copies of documents, certificates, financial statements.
Penalty:RM5,000 / Default Penalty:RM100
Articles of Association
The “Articles of Association”, which constitutes the internal regulations of a company usually contains clauses dealing with under-mentioned matters.
Every company is required to have a written constitution in the form of the above two documents.
The name of the company
The name of each first director (minimum two)
The name of the first company secretary
The minimum and maximum number of directors
The share qualifications of each director, if any
Name, identity card number (if Malaysian), passport (if foreigner), address and occupation of each subscriber
Name, designation and address of the witness to the signature of each subscriber
The “Articles of Association” also includes a provision governing the use of a company seal on certain formal documents such as share certificates.
Memorandum And Articles of Association
The “Memorandum of Association” defines the essential components of the structure of the company. Its essential contents are:
The name of the company (which must end with the words “Sendirian Berhad” if it is a private company, or just “Berhad” if it is a public company);
The situation of the company’s registered office;
The objects of the company, i.e the nature of business intended to be carried out;
That the liability of the members is limited
The nominal amount of the authorized share capital with which it is proposed to register the company and the division of such capital into shares of a fixed amount; and
The association clauses
The “Memorandum of Association” must be signed by at least two subscribers; duly dated. The signature of each subscriber must be witnessed by a third person. Each of the subscribers must undertake to subscribe for one or more shares of the company.
