Companies (Amendment) Act 2024 will give more transparency, says minister

 

Domestic trade and cost of living minister Armizan Mohd Ali said Malaysia’s efforts to deal with money laundering, terrorist financing, corruption and tax evasion activities were being assessed by international bodies.

PETALING JAYA: The Companies (Amendment) Act 2024, which will come into force on April 1, will improve beneficial ownership reporting and enhance the corporate sector’s transparency, says domestic trade and cost of living minister Armizan Mohd Ali.

In a statement, the minister said the Act’s 31 clauses, comprising four policy clusters, would strengthen the framework of beneficial ownership reporting, among others.

Armizan said the new legal provisions oblige every company to identify their beneficial owner, or the individual who controls the company via ownership of 20% or more of shares, with the ability to influence the board of directors’ decisions.

“Improvements to the beneficial ownership reporting framework take into account the latest developments at the international level in the fight against money laundering, terrorist financing, corruption and tax evasion activities,” he said.

Armizan said Malaysia’s efforts to deal with money laundering, terrorist financing, corruption and tax evasion activities were being assessed starting this year by various international bodies such as the Financial Action Task Force and the Organisation for Economic Co-operation and Development.

“It is hoped that the nation’s corporate community is prepared to comply with all the provisions of the Companies (Amendment) Act 2024,” he said.

The Act was first approved in the Dewan Rakyat on Nov 28 last year and in the Dewan Negara on Dec 13, receiving royal assent on Jan 24 this year and gazetted as the Companies (Amendment) Act 2024 on Feb 2.

Though the Act will come into force on April 1, Sections 4, 14, 26 and 28 will come into force on a date to be announced later.

Companies Commission of Malaysia chairman Ahmad Sabki Yusof said last year that the bill also aimed to prevent companies from being wound up so that they could stay afloat and remain in business.

“Without a corporate rescue mechanism, creditors can take legal action and invoke an insolvency declaration, so we want to avoid that,” Sabki said. - FMT