Dealing In Companies in Malaysia

The Companies Act 2016 (CA 2016) was introduced on 31 January 2017 and came into operation on 30 May 2017, repealing and replacing the Companies Act 1965 (CA 1965). The CA 2016 seeks to improve corporate governance and business transparency in Malaysia while providing better protection for investors.

Under the CA 2016, a company may be wound up by the court if, inter alia, the company is unable to pay its debts as and when they fall due. In addition, the Minister of Domestic Trade and Consumer Affairs (the Minister) has the power to order the compulsory winding up of a company if, inter alia, the company has been carrying on business for a fraudulent or unlawful purpose, or for a purpose prejudicial to the national interest.

The winding up of a company may be initiated by:

(a) the company itself;

(b) a creditor of the company; or

(c) the Minister.

A company may be wound up voluntarily by its members if:

(a) the company has by special resolution resolved that it be wound up voluntarily; and

(b) the company has complied with the requirements of the CA 2016 in relation to the holding of the meeting at which the resolution was