The Companies Commission of Malaysia has decided that the new Interest Schemes Act 2016 and the Companies Act 2016 will come into operational force on 31.1.2017. The regulatory framework will be implemented in stages. Below is the CCM Press Statement-
ANNOUNCEMENT ON THE ENFORCEMENT DATE OF COMPANIES ACT 2016
The
Companies Commission of Malaysia (SSM) hereby notifies that the
Companies Act 2016 (CA 2016) will be implemented on staggered basis with
the first phase to be effective from 31 January 2017. With the
enforcement of the first phase of the CA 2016, the Companies Act 1965 is
repealed.
2.Several provisions in the CA 2016 which have yet to be effective are as follows:
(a)Section 241 – provision relating to the requirement for company secretaries to register with Registrar; and
(b)Division
8 of Part III – provisions relating to corporate rescue mechanisms on
corporate voluntary arrangement and judicial management.
3.With the effective of the enforcement date, SSM would like to draw your attention to the following:
(a)Introduction of single member/director company
Beginning
from the date the CA 2016 becomes effective, a company may be
incorporated by or have only one member and that single member can also
be the sole director of the company. However, for public companies, the
CA 2016 still retains the minimum requirement of 2 directors.
(b)Change of “certificate of registration” to “notice of registration”
Effective
from the enforcement of the CA 2016, SSM will issue a notice of
registration for the incorporation of a new company to confirm that
provisions relating to the requirements for registration have been
complied with in line with the requirement of the law.
(c)Abolition of the authorized capital concept
Under
the CA 2016, a company is no longer required to state its authorized
capital. Instead, a company is required to notify its issued share
capital and paid up capital and the related changes through the return
of allotments.
(d)Abolition of concept of shares with nominal value
With
effect from 31 January 2017, any newly issued share will no longer be
tied with the nominal value when the company was incorporated. A company
may issue shares at a price depending on the factors affecting the
current circumstances and needs of the company.
(e)Companies are no longer required to have constitution or memorandum & articles of association
For a
company which is incorporated beginning from 31 January 2017, the
company has the option whether to adopt a constitution or otherwise. For
a company which was incorporated before the CA 2016 came into effect,
the existing constitution (memorandum & articles of association)
will continue to be applicable to such companies until the companies
resolve otherwise. However, it is still mandatory for a company limited
by guarantee to have a constitution.
(f)Companies are not required to have a common seal
Effective
from 31 January 2017, a company has the option to have a common seal.
Execution of documents must comply with the procedures outlined under
Division 9 of Part II including situations when a company decides to
have a common seal.
(g)Abolition of the requirement for annual general meeting for private companies
Beginning
from 31 January 2017, all private companies are no longer required to
hold annual general meetings. Instead all decisions of private companies
can be fully made through circular resolutions.
(h)Decoupling of lodgement of Annual Return and Financial Statements
Under
the CA 2016, the requirement to lodge Annual Returns is based on the
anniversary of the incorporation of a company, and the date for the
lodgement of Financial Statements is no later than 7 months from the
financial year end of the company.
4.SSM
seeks the cooperation of YBhg. Tan Sri/Datuk/Dato’/Datin/Tuan/Puan to
take into account of the changes stated above when reviewing,
formulating or implementing policies and procedures which may affect
companies when dealing with your
Ministry/Department/Agency/Organisation. This is to ensure that the
business friendly policies which are contained in the CA 2016 can be
implemented efficiently and the benefits could be enjoyed by the
business community in general.
5.Apart
from the CA 2016, SSM will also enforce the Interest Schemes Act 2016
effective from 31 January 2017. The Interest Schemes Act regulates the
offering of interest schemes as an alternative to fundraising activities
for companies. The provisions in the Interest Schemes Act were
previously contained in the Companies Act 1965.
