COMPETITION LAW & ANTITRUST

Finding of infringement by the Malaysian Competition Commission (“MyCC”)

 
For further information regarding competition law and antitrust matters, please contact

Dato' Johari Razak
jorazak@shearndelamore.com

K Shanti Mogan
shanti@shearndelamore.com
 

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CORPORATE & COMMERCIAL

Proposed enhancements to the Guidelines on Real Estate Investment Trusts (REITs) (“REITs Guidelines”)

On 14 July 2016, Securities Commission Malaysia (“SCM”) released a consultation paper seeking public feedback on the proposed enhancements to the REITs Guidelines. The REITs Guidelines was first published by the SCM on 21 August 2008 and has since been updated once on 28 December 2012.

The objectives of the proposed enhancements include:

1. facilitating growth of the maturing REITs market in a manner that promotes stronger governance practices and instills greater market confidence;
2. allowing REITs to invest in a wider range of real estate asset classes; and
3. strengthening corporate governance practices and enhancing the level of disclosures and reporting to unit holders.

The new measures to be introduced into the REITs Guidelines are, among others:

1. to allow REITs to acquire vacant land and to undertake property development subject to a cap of 15% of their total asset value;
2. to allow REIT managers to enter into long-term leases with registered proprietors of real estate;
3. to require REIT managers to establish an Audit Committee to further improve investor protection and include a statement of corporate governance and a statement of internal control in annual reports;
4. to remove options of allowing REITs to increase their borrowing thresholds by obtaining unit holders’ approval and limiting the threshold to 50% of total asset value;
5. to carry out yearly valuation updates by a registered valuer in addition to the current requirement for full valuation every three years;
6. in the event assets are acquired with income support by REITs, to provide complete and relevant information to investors for them to make an informed investment decision; and
7. to streamline the post-listing requirements for REITs with listed corporations by applying the Main Market Listing Requirements of Bursa Securities Malaysia Berhad to REITs.

You can find the consultation paper on the SCM’s website www.sc.com.my/reit2016. Interested parties and the public are invited to submit their comments and feedback online at http://surveys.sc.com.my/s3/Public-Consultation-REITs-Guidelines before the closing date of 13 September 2016. 

For further information regarding corporate and commercial law matters, please contact

Datin Grace C G Yeoh
gcgyeoh@shearndelamore.com

Lorraine Cheah
l_cheah@shearndelamore.com
 

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DISPUTE RESOLUTION

Government of India v Petrocon India Limited [2016] 6 CLJ 321, Federal Court

The seat of arbitration determines the curial law that will govern the arbitration proceedings. The seat refers to the legal seat rather than the geographical seat. It is a permanent or fixed seat which can only be changed by consent of parties to the arbitration and must be distinguished from the physical or geographical place where the arbitration was held. 

For further information regarding dispute resolution matters, please contact

Datin Jeyanthini Kannaperan
jeyanthini@shearndelamore.com

Robert Lazar
rlazar@shearndelamore.com
 

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FINANCIAL SERVICES

Real-time Electronic Transfer of Funds and Securities ("RENTAS") system ("RENTAS SBL Policy")

Bank Negara Malaysia ("BNM") has issued an updated policy document in respect of securities borrowing and lending of securities settled in the RENTAS SBL Policy. The RENTAS SBL Policy came into effect on 1 July 2016, and supersedes the Guidelines on Securities Borrowing and Lending Programme under RENTAS issued in December 2001.
 
The RENTAS SBL Policy will apply to all market participants undertaking securities borrowing and lending transactions in respect of scripless securities transacted and deposited under the RENTAS system except for securities borrowing and lending transactions under BNM’s Institutional Securities Custodian Programme.

Securities Commission Malaysia's ("SCM") new measures to boost unit trust industry
 

1. Guidelines on Unit Trust Funds;
2. Prospectus Guidelines for Collective Investment Schemes; and
3. Guidelines on Sales Practices of Unlisted Capital Market Products,