Financial Distress: 6 Reliefs for Corporate Malaysia

In EY Malaysia’s Transactions Insights (February 2021), it was pointed out that the prolonged impact of the COVID-19 pandemic continues to disrupt Corporate Malaysia, financially and operationally. Almost a year on, the magnitude of financial risks has increased. A vast majority of companies would require some form of recapitalization to improve their financial position.

I identify six much-needed reliefs to provide a shot in the arm for Corporate Malaysia. The reliefs will help to inoculate and strengthen businesses against further distress.

In the Companies Commission of Malaysia (CCM) Consultation Document issued in July 2020, CCM set out policies and a draft proposed Bill in support of such reliefs. I wrote about these changes in The Edge Malaysia as well.

Like the vaccine rollout in Malaysia, I am hoping for a smooth and quick rollout of these proposed laws. The commentary below is based on the proposed laws by the CCM. Continue reading

Case Update: Federal Court to Decide If Unsecured Creditors Can Oppose Judicial Management

Lee Shih and Lynn comment on the Federal Court proceedings involving points of law on judicial management

The Federal Court in the case of Million Westlink Sdn Bhd will now decide on an important area on judicial management law. Whether unsecured creditors can appear in an application for a judicial management order and oppose the making of the judicial management order. Leave to the Federal Court was granted on 4 January 2021. Continue reading

Top 5 Restructuring & Insolvency Cases in Malaysia for 2020

We continue the Top 5 cases series with the top five restructuring & insolvency cases in Malaysia for the year 2020. You can also read the 2019 edition. This year’s cases range from restraining orders, judicial management and voluntary arrangement in bankruptcy. Continue reading

Judicial Management Statistics in Malaysia

On 26 and 27 October 2020, I spoke at the two-day webinar organised by the Companies Commission of Malaysia Training Academy. I was joined by Norhaslinda Salleh of the Companies Commission of Malaysia, Khoo Poh Poh of Ernst & Young and Jimmy Ng of Chooi & Co + Cheang & Ariff.

We covered a range of restructuring and insolvency topics. There were some interesting facts shared as well. Continue reading

Case Update: Biaxis Decision – Stringent Requirements for a Judicial Management Application

The High Court decision of Re Biaxis (M) Sdn Bhd [2020] MLJU 1188 (grounds of judgment dated 12 August 2020) set stringent requirements for a company to successfully apply for judicial management. These requirements may set an unnecessarily high bar for a distressed company to meet. Continue reading

10 Key Restructuring Changes in the Proposed Companies Amendment Bill 2020

The Companies Commission of Malaysia (SSM) has issued its Consultative Document Companies (Amendment) Bill 2020. The proposed amendments cover a wide range of areas. I will write another time on some of the other areas like beneficial ownership and other amendments.

One key aspect of the Companies Amendment Bill 2020 is the very significant amendments and strengthening of the restructuring framework through the scheme of arrangement and corporate rescue mechanisms. The proposed amendments follow similar moves taken by the United Kingdom and Singapore in assisting and helping distressed companies and ensuring safeguards for creditors’ interests.

I highlight the 10 most significant restructuring and corporate rescue amendments which are in the proposed Companies Amendment Bill 2020. I did take part in the initial consultation process as a member of some of the professional bodies. I very much welcome these much-needed restructuring and relief tools to help distressed businesses in the Covid-19 environment. Continue reading