Company Act in Malaysia

Updated on Wednesday 21st June 2017

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All businesses in Malaysia are regulated by a set of rules stipulated in the Companies Act, which gives a comprehensive image on many aspects related to the incorporation on the company, the obligations and rights of the shareholders and of the directors, the audit procedures, requirements for tax compliance and many others. Our team of company formation specialists in Malaysia can assist foreign investors with a detailed presentation on the provisions of the Companies Act

The Malaysian Companies Act 

The Malaysian Companies Act was enforced by the local authorities in 1965; since then, the Act has been amended several times, in order to comply with new local measures taken by the Malaysian institutions

Part I of the Act offers an understanding on the legal definition of the subsidiaries or holding companies and on the way in which a person can own shares in a business. Part II refers to the administration of the Act, which prescribes the legal rights on the institutions which regulate the activity of businesses in Malaysia. Section 7A stipulates that the governmental bodies, represented by ministries, have the legal rights to exempt legal entities, such as statutory bodies or government agencies, from paying various fees prescribed in the Act; our team of company incorporation agents in Malaysia can provide further details on this part of the law.  

The video below provides more details on the Companies Act in Malaysia


Incorporation of a Malaysian company 

Part III provides the legal provisions related to the incorporation of companies in Malaysia. Section 14 specifies that a company can be registered by at least two persons and, according with the Section 14 (2), a company can be established as follows: 

•    company limited by shares;
•    company limited by guarantee;
•    company limited by shares and by guarantee;
•    unlimited company. 

Section 16 stipulates that the first step of the incorporation process refers to the registration of a proposed trading name, alongside with the statutory documents of the company, at the local Registrar represented by the Companies Commission of Malaysia

The private company, which is the most common type of business registered in Malaysia, is regulated in accordance with the provisions of the Part III, Section 15. The memorandum of a business set up as a private company must contain the following: 

•    the transfer rights on the shares is restricted;
•    the number of members is limited to 50;
•    the shares can’t be sold to the public. 

Persons interested in receiving more details on the provisions of the Companies Act can contact our team of company incorporation representatives



May 4, 2016

This article was very helpful, as I am now studying the legal environment applicable to both individuals and legal entities in Malaysia.

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