The Companies Bill 2015 has received Royal Assent on 31 August 2016 and has been gazetted as the Companies Act 2016 (“Companies Act”) on 15 September 2016.  The Companies Act will come into operation on a date to be appointed by the Minister by notification in the Gazette, and the Minister may appoint different dates for the coming into operation of different provisions of the Companies Act.

The Companies Act 2016 is available on the Companies Commission of Malaysia’s website:
www.ssm.com.my/sites/default/files/acts/aktaBI_20160915_CompaniesAct2016Act777.pdf.

Bursa Malaysia’s proposal to establish a (new) market for small and medium enterprises
 

1. Main Market — for established companies with profit track record and/or have sizeable operations; and
2. ACE Market — enable smaller companies with growth potential to tap equity funding.

1. The (New) Market will be opened to all Malaysian SMEs which are public companies incorporated in Malaysia;
2. There will be no profit or operating track record requirements in relation to the licensing criteria for the (New) Market;
3. Two methods of listing on the (New) Market are available, namely: (i) listing with fund raising (via placement or excluded issue); or (ii) listing without fund raising (via listing by introduction);
4. The core business of the issuer must not be the holding of investment in other listed corporations;
5. The issuer must have at least 10% of the total share capital in the hands of public shareholders at the point of listing on the (New) Market;
6. Only ordinary shares are allowed to be listed on the (New) Market;
7. Offer for sale is not allowed for promoters of the (New) Market but is allowed for registered venture capital corporation, registered venture capital management corporation, private equity firms and qualified angel investors accredited by the Malaysian Business Angels Network as an exit strategy; and
8. A moratorium will be imposed on the sale, transfer or assignment of shares by promoters of an applicant of (New) Market whereby the moratorium applies to the entire shareholdings of the promoters of an applicant for the first year from the date of listing; and upon expiry of the one year period, the listed corporation must ensure that the promoters’ aggregate shareholding is at least 45% of the nominal issued and paid up ordinary share capital.

The consultation paper is available at Bursa Malaysia’s website: www.bursamalaysia.com/market/regulation/rules/public-consultation.

Interested parties and the public are invited to submit their written comments and feedback to Bursa Malaysia before the closing date of 2 October 2016.

Amendments to the Capital Markets and Services (Dispute Resolution) Regulations 2010

The Capital Markets Services (Dispute Resolution) Regulations 2010 (“Regulations”) were passed in 2010 pursuant to section 378(1) of the Capital Markets and Services Act 2007 (“Act”). Section 378(1) of the Act pertains to the settlement of disputes in connection with capital market services and products. The Regulations have been amended with effect from 5 September 2016. One of the key amendments is the insertion of a new Regulation 5(3) which gives power to Securities Commission Malaysia ("SCM") to direct any licensed person or registered person to be a member of the Securities Industries Dispute Resolution Center ("SIDREC").

Pursuant to this new insertion, the SCM and Bank Negara Malaysia (“BNM”) issued announcements on 5 September 2016 directing that licensed persons such as commercial and Islamic banks offering capital market services and products are now members of the SIDREC. Following this membership, capital market investors facing disputes while dealing with commercial and Islamic banks under the purview of BNM now have access to dispute resolution services through the SIDREC.

The SIDREC is an independent body established by the SCM in 2011 which provides free dispute resolution services to investors. Under the SIDREC framework, investors may file for a dispute resolution with claims up to RM250,000 and SIDREC may provide mediation for claims exceeding RM250,000 where both parties agree. Prior to this, the channel for redress for investors dealing with BNM-regulated institutions was the Financial Mediation Bureau (“FMB”) which dealt with conventional claims not exceeding RM100,000. Investors with ongoing matters with the FMB do not need to resubmit their cases with SIDREC. The SCM and BNM will work with both SIDREC and the FMB in an effort to ease the transition.

The Capital Markets and Services (Dispute Resolution) (Amendment) Regulations 2016 are available on the Securities Commission website:
www.sc.com.my/wp-content/uploads/eng/html/resources/acts/PU_(A)_233_2016.pdf.

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
 

Silver Corridor Sdn Bhd v Gallant Acres Sdn Bhd & Anor [2016] 7 CLJ 823

The Federal Court affirmed the Court of Appeal decision in invoking the rule against undue preference under Section 293 of the Companies Act 1965 (read together with Section 52 of the Bankruptcy Act 1967)  in a  transaction involving the sale and purchase of 12 shop lots.

For further information regarding dispute resolution matters, please contact

Datin Jeyanthini Kannaperan
jeyanthini@shearndelamore.com

Robert Lazar
rlazar@shearndelamore.com
 

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TAX & REVENUE

Income tax 

The Inland Revenue Board of Malaysia has issued a new technical guideline on 2 September 2016 in the Malay language called “Garis Panduan Berkaitan Potongan Dua Kali Secara Automatik Bagi Projek Penyelidikan Dan Pembangunan (R&D)”.

For further information regarding tax and revenue law matters, please contact

Goh Ka Im
kgoh@shearndelamore.com

Anand Raj
anand@shearndelamore.com