The Companies Commission of Malaysia (“CCM”) issued a new set of Guidelines on Company Names (“2022 Guidelines”) on 15 March 2022 that superseded the previous corresponding guidelines dated 31 January 2017 (“2017 Guidelines”).
 
This article outlines the main changes introduced by the 2022 Guidelines.

Scope of the 2022 Guidelines
 
It is stated in the 2022 Guidelines that the guidelines apply to all applications pertaining to the following¹:

1. registration of name for incorporation of a company;
2. change of name of a company;
3. registration of a foreign company; and
4. change of name of a foreign company.  

In contrast, it was stated in the 2017 Guidelines that the said guidelines apply to applications in respect of categories (a) and (b) above.² Therefore, the 2022 Guidelines clarify that the considerations applicable to locally incorporated companies also apply to foreign companies that seek registration or are registered in Malaysia.
 
Confirmation of Availability of Name
 
The 2022 Guidelines state that for incorporation of a company, the confirmation of availability of name can be sought simultaneously during the incorporation exercise.³ Although it appears that this has already been allowed under the CCM’s existing practice, the 2022 Guidelines formalises this practice.
 
Names of Companies – Dos and Don’ts
 
The 2022 Guidelines include additional provisions pertaining to the general principles and characteristics of names acceptable for registration.
 
The following paragraphs of the 2022 Guidelines should be noted when deciding on a name of a company. It is possible that some of these restrictions or relaxations may have been applied by the CCM previously, however, they nevertheless serve as a useful guidance for applicants.

1. Individual names and names of historical figures  
   
   Paragraph 8(h) provides that: “The usage of individual names refers to the name of the director or director’s family members only as stated on the individual’s identity card. Names associated with local or foreign historical figures, for example, Parameswara, Ibnu Sina, Abraham Lincoln are allowed”.
    
   In our experience, the CCM’s practice even prior to the issuance of the 2022 Guidelines is to require proof of identity (e.g. an individual’s NRIC / identification card) insofar as the usage of individual names in a company name is concerned.  

2. Created words  
   
   Paragraph 8(j) introduces a new provision which reads: “When using created words, a letter of consent is not required from an existing company that carries the same created word. For example, if a new application with the name Jellex Assets Sdn. Bhd. (Jellex being a created word), the applicant is not required to provide a consent letter from Jellex Jaya Sdn. Bhd. (an existing company)”.
    
   The CCM’s practice previously was to require a consent letter from an existing company that carries the same word in any circumstances unless the relevant word is a general word in English, e.g. “green”, or in Bahasa Malaysia, e.g. “hijau”.
    
   This new provision may have severe implications for companies whose names are derived from created words, e.g. “Westpac” and “AmBank”, as a consent letter is no longer required.

3. Use of “Corporation”, “Incorporated”, “Perbadanan” etc.  
   
   Paragraph 8(m) provides that: “The words “Corporation”, “Corp”, "Perbadanan”, “Incorporated”, “Diperbadankan”, “Incorporation”, “Incorp”, “Inc”, “Pemerbadanan", is prohibited in their use unless there is a government interest in the company and a letter of consent from the relevant Ministry must be given. However, the word is allowed if it is related to the registration of a foreign company or for a change of name of an existing company in which its existing name carries such words”.
    
   The rationale for prohibiting the use of the word “Corporation” is unclear as it has long been used by some companies in Malaysia, e.g. IGB Corporation Berhad and Berjaya Corporation Berhad. It is possible that the use of certain of these words, e.g. “Perbadanan” and “Diperbadankan”, is now restricted as they may suggest that the entity is a statutory body.

 
Names Previously Used
 
The 2022 Guidelines now expressly permit the use of names that have been previously used in these circumstances:

1. Dissolved or wound up company or limited liability partnership
   
   Paragraph 11(i) provides as follows: “The use of the name of a company that has been dissolved by court order / voluntary winding up is allowed after seven (7) years of dissolution under subsection 555(1) of the Companies Act 2016. The use of a Limited Liability Partnership that has been dissolved is allowed after two (2) years of dissolution under section 52 of the Limited Liability Partnerships Act 2012”.
    
   The 7-year moratorium on the use of the name of a company that has been dissolved or wound up corresponds with the 7-year time period allowed under section 555(1) of the Companies Act 2016 (“CA 2016”) for a person to apply to the Court for the reinstatement of the name of the company which has been struck off by the Registrar of Companies (“Registrar”) – the moratorium under the 2017 Guidelines was 15 years, in line with section 308(5) of the Companies Act 1965 (the predecessor of the CA 2016).

2. Reuse of name of company or limited liability partnership  
   
   Paragraph 11(j) states that the reuse of a company’s or a limited liability partnership’s previously used name is permitted subject to the following:

1. if the previous name is no longer in use and the period has exceeded 12 months, the name can be used without a letter of consent;


2. if the period of non-usage of the previous name is within 12 months, a letter of consent must be included.

3. Name of expired or terminated business  
   
   Paragraph 11(k) permits the reuse of expired or terminated business names in the following circumstances:

1. after 12 months from the expiration date of the business; or


2. if the business has been terminated, when the relevant notification has been lodged with the Registrar.

 
Use of Names Prohibited by the Minister
 
In exercising the powers conferred under sections 26(1)(d) and 564 of the CA 2016, the Minister of Domestic Trade, Co-Operative and Consumerism⁴ (“Minister”) has directed the Registrar vide Gazette Notification No. 4620 dated 9 March 2017 (“Minister’s Direction”) not to accept for registration any name of a company or foreign company that is a name or a name of a kind mentioned in the Schedule to the Minister’s Direction unless prior approval of the Minister has been obtained.
 

1. Names suggesting royal patronage or connection with royalty
   
   Names stated in the Schedule to the Minister’s Direction include, amongst others, those that suggest a connection with a member of the royal family or royal patronage, such as “Royal”, “King”, “Queen”, “Prince”, “Princess”, “Crown”, “Regent” or “Imperial”.
    
   However, paragraph 11(a) of the 2022 Guidelines provides certain flexibilities to the Minister’s Direction by permitting the Registrar to consider applications for the use of the names mentioned above subject to the following circumstances:

1. in respect of the registration of a foreign company in Malaysia, the name of the company shall be identical to the parent company;


2. the word has been registered as a registered trademark in Malaysia and a letter of consent is obtained from the registered trademark owner;


3. the word refers to the name of a location such as “Putra Nilai” or “Taman Mahkota”;


4. the word indicates the product itself or the size of the product that is being traded such as “Musang King” or “king-sized roof”; or


5. at the Registrar’s discretion, the reasons given by the applicant do not indicate any connection with a member of the royal family or royal patronage.

2. Use of names or words in the Minister’s Direction
   
   In relation to any word or name contained in the Minister’s Direction, paragraph 13 of the 2022 Guidelines provides as follows:
    
   “If an applicant or promoter of a company has justifications to use the names or words contained in the [Minister’s] Direction, the said applicant or promoter has to appeal to the Minister under subsection 27(3) of the Companies Act 2016 through the Registrar, stating the reasons or justifications for using such names or words as part of the proposed name by the company, together with a payment of RM300.00.”
    
   The fee charged in respect of the appeal prior to the issuance of the 2022 Guidelines was RM150.00.

Words/Phrases Controlled by Referral Authorities
 
Annexure 1 to the 2022 Guidelines sets out a list of words and phrases that are controlled by certain authorities or agencies (e.g. Bank Negara Malaysia, Board of Architects Malaysia, Securities Commission Malaysia, Ministry of Housing and Local Government and Ministry of Health) (“Referral Authority”). The 2022 Guidelines stipulate that a letter of permission is required from the relevant Referral Authority when applying for a name that includes a controlled word or phrase.⁵
 
The restriction in respect of words/phrases controlled by a Referral Authority has always been in place although it was not particularised in the 2017 Guidelines. The introduction of Annexure 1 to the 2022 Guidelines serves as helpful guidance for applicants to check beforehand whether any word/phrase in the name of their proposed entity is a controlled word/phrase, and if necessary to obtain a letter of permission from the relevant Referral Authority. It should, however, be noted that the list provided in Annexure 1 is not exhaustive.

Comments
 
The issuance of the 2022 Guidelines is certainly welcomed as it clarifies and formalises some of the CCM’s existing practices and treatment of company names.

Article by Kok Chee Kheong (Partner) and Vanessa Ho (Associate) of the Corporate Practice of Skrine.