The Court of Appeal in Likas Bay Precinct Sdn Bhd v Bina Puri Sdn Bhd  MLJU 49 has decided that a petitioner can issue a statutory demand for winding up based on a mere adjudication decision. There is no requirement to first enforce the adjudication decision as a court judgment before issuing such a winding up notice.
After my earlier introduction and summary of the new Companies Bill, I will be writing a series of articles on the new Companies Bill. I aim to release an article every few weeks or so, touching on the different areas of the new law. For ease of reference, I will continue to refer to it as the Companies Bill and insert the clause references in brackets.
I kick off this series by focusing on 3 things existing companies should already look out for under the Companies Bill. While the Companies Bill may only come into force in the next 6-12 months or so, I highlight 3 areas companies should start preparing for right now.
In summary, these 3 areas are:
- Your existing Memorandum and Articles of Association: Do you need to fine-tune the provisions?
- The new law will shift to a no-par value regime: Impact on your existing share premium account.
- Putting in place checklists and guidelines for the new internal processes.
Bloomberg Malaysia came across my earlier TML post on the Companies Bill and invited me on their show to have a short chat. I was a bit nervous leading up to it, with it being my first TV interview. But I am glad I got to share my views on the new Bill.
I spoke about how the new laws would transform the corporate landscape, spur entrepreneurship and also strengthen corporate governance.
That whole experience felt a bit like Suits meets The Newsroom. A lawyer getting a small glimpse into the inner workings of a news studio.
Bloomberg has also uploaded the clip on their YouTube channel and you can view it below.
[update: The Bill has received Royal Assent on 31 August 2016 and has been gazetted on 15 September 2016 as the Companies Act 2016. I have written briefly about this in my latest post.]
The new Companies Act will undoubtedly transform Malaysia’s corporate landscape. Underpinning the changes are the aims of spurring entrepreneurship, making the corporate vehicle more attractive for businesses, deregulating certain aspects of the corporate process, and to introduce the concept of corporate rescue for ailing companies.
It is anticipated that the new Companies Act itself will not be brought into force until a year’s time or so. This is because the new regulations, rules and guidelines will still need to be drawn up.
I set out below 7 of the more significant areas we will see in the new Companies Act. Continue reading
This post is a part of a series based on my Law for Startups workshop at MaGIC in September 2015. It’s a basic introduction to legalities for startup founders. You can access the slides here.
Read the earlier posts for context:
- Law for startups in Malaysia — building on the best foundations.
- The legal landscape in Malaysia for startups — a hybrid of traditional corporate practices and Silicon Valley models.
One of the earliest decisions that a startup or small business founder will have to make is choosing the right business vehicle through which the business/idea will be carried out.
Business vehicle options
The most common business vehicle options in Malaysia are —
- sole proprietorships / partnerships;
- private limited liability companies (Companies / Sdn Bhd); and
- most recently, the limited liability partnership (LLP).
I was interviewed by The Edge Financial Daily and I shared my views on some of the challenges that directors will face under the upcoming Companies Bill.
“It’s not an easy balancing act to be done. But if you are speaking from the perspective of minority shareholders or even shareholders, I would say they will be welcoming these changes because there is more information, and the directors have to allow a platform for the shareholders to discuss, query, ask questions, even if it’s not contained specifically in any audited accounts.
“Free flow of information is quite welcomed,” Lee told The Edge Financial Daily after presenting his paper “New Companies Bill: Upcoming Changes and Impact on Directors and Shareholders” at the Malaysia Legal and Corporate Conference on Oct 7.
Although Lee welcomed the greater flow of information and interaction between the board and the shareholders, he warned of the possibility of shareholders abusing the new privileges to the detriment of the company and its operations.”
My views in The Edge were also briefly discussed on the BFM Morning Run on 19 October 2015.
It appears from the Parliament website that the Companies Bill 2015 was tabled for its First Reading on 19 October 2015 and for the Second Reading on 20 October 2015. So we are now in the process of ushering in the new laws.