The Minister of Domestic Trade and Consumer Affairs issued the Prescription of Amount of Indebtedness of Company under Paragraph 466(1)(a) (Gazette Notification No. 4159/2021)
stating that the amount of indebtedness for the purposes of section 466(1)(a) of the Companies Act 2016 shall be an amount exceeding RM50,000 with effect from 1 April 2021.
This means that a creditor may only commence winding-up proceedings against a debtor company for “inability to pay debts
” under section 466(1)(a) if the debtor company fails to satisfy a debt exceeding RM50,000, or to secure or compound the said sum with the creditor, within 21 days after a notice of demand has been served upon the debtor company at its registered office.
The minimum debt threshold of an amount exceeding RM50,000 is identical to the threshold under the previous prescription order issued by the Minister under Gazette Notification No. 21841 of 2020
which expired on 31 March 2021. Unlike the previous prescription order, the current prescription order does not
have a sunset date and will therefore remain in effect until it is amended or revoked by a subsequent order.
Alert prepared by Rachel Ten (Senior Associate) of Skrine