On 28.8.2024, the Federal Court issued a landmark decision that clarified the distinctions between oppression actions and derivative actions under the Companies Act 2016 (CA 2016). This ruling offers valuable guidance in determining the appropriate legal course based on individual circumstances. Facts Low Cheng Teik & ors v Low Ean Nee Civil Appeal No.: 02(f)-30-04/2023(W) was an appeal by Low Cheng Teik and two others (Appellants) against the decision of the Court of Appeal

As businesses may also be misused to finance serious offences such as money laundering, terrorism, proliferation financing, and other illegal activities, the Companies Act 2016 implemented a beneficial ownership (BO) reporting system to reduce the prevalence of such unlawful activities. The Companies (Amendment) Act 2024 (Amendment Act) came into operation on 1 April 2024. This alert discusses the key amendments, specifically the beneficial ownership reporting requirements.

It is commonplace that contracting parties will document their meeting of minds into a written agreement for formality and ease of enforceability. The question is whether contracting parties can subsequently come to a mutual agreement to vary the terms of the initial agreement including the agreement in relation to consideration i.e. price. Although a contract is essentially founded on the consent of both the promisor and promisee, this does not mean contracting parties can v

Derivative action is an action commenced on behalf of a company, especially in cases of “fraud on the minority” and “wrongdoers in control”. The commencement of derivative action is now a statutory regime under the Companies Act 2016 (CA). A complainant may, with the leave of court initiate, intervene in or defend a proceeding on behalf of a company. This is not confined to the members of the company alone as it also extends to persons who are not members but entitled to be

Companies often embark on a spectrum of corporate exercises designed to bolster their market standing, drive shareholder value and adapt to the ever-evolving business dynamics. This alert examines the various common corporate exercises that are undertaken by listed companies, ranging from rights issues to raise additional capital to bonus issues that reward shareholders. Each initiative represents a deliberate step towards sustainable growth of these listed companies. Rig

Section 245 of the Companies Act 2016 (CA 2016) provides for a company and for its directors and manager to keep and maintain accounting and other records at the registered office of the company or such other places as the directors think fit. These accounting and other records shall at all times be open for inspection by the directors. Further, the court also may by order allow an approved company auditor acting for a director to inspect the accounting and other records of t

‘…one has to remember that a scheme of arrangement is a corporate rescue mechanism. As with other corporate rescue mechanisms, such as judicial management, it seeks to rehabilitate the company and achieve a better realisation of assets than possible on liquidation.’ Hitachi Plant Engineering & Construction Co Ltd And Another V Eltraco International Pte Ltd And Another Appeal [2003] 4 SLR 384 Consequent to the Consultative Document on the Proposed Companies (Amendment) Bill 2

In the realm of contractual agreements, the interplay between oral promises and subsequent written agreements often becomes a focal point of legal scrutiny. The Federal Court in Abd Ghani Golamdin v Universiti Utara Malaysia & 2 Ors [2023] 6 MLJ 1 examined a scenario wherein an employee received an oral commitment of additional remuneration from his superiors, and this commitment was subsequently documented in writing. A key question emerged - Would this written “agreement” s

On 10 October 2023, the Government tabled amendments to the Companies Act 2016 (CA) via the Companies (Amendment) Bill 2023. This Bill introduces, among others, a comprehensive beneficial ownership reporting framework under the new Division 8A in Part II of the CA. Proposed Amendments The key proposed amendments are as follows: 1.Criteria of Beneficial Owner Presently, Section 2 of the CA defines “beneficial owner” as the ultimate owner of the shares and does not include a no

In a move towards strengthening corporate governance and promoting high standards of integrity and accountability, the Companies Commission Malaysia (CCM) has recently issued a new Code of Ethics for Company Director and Company Secretary ( Code of Ethics ). This Code of Ethics serves as general guidelines on the ethical expectations of directors and company secretaries when carrying out their duties. This Code of Ethics supersedes the previous Code of Ethics – Company Direct