The Companies Act 2016 (‘CA2016’), the relevant provisions of which came into operation on 31 January 2017, introduced the concept of no par value shares into Malaysian company law.
The CA2016 provided a period of 24 months from 31 January 2017 for companies to transition from the par value regime to the no par value regime by allowing companies with credit balances in their share premium account and capital redemption reserve account to utilise such credit balances in the manner set out in sections 618(3) and 618(4) respectively of CA2016 during the aforesaid 24-month period.
With the 24-month transitional period coming to a close on 30 January 2019, the Companies Commission of Malaysia has provided further guidance, in addition to the provisions in section 618 of CA2016, by uploading the following on its website on 31 January 2019 –
(1) Two new FAQs (i.e.
Questions 4 and 5) to Part A of the document, Enforcement Date of the Companies Act 2016 and Transitional Issues, as follows –
4. Is a company which has no Share Premium Account or Capital Redemption Reserve required to submit notification to
under subsection 618(8)1 or (9)2 with the Registrar?
Answer: Such companies may submit such notification. If no notification is submitted the Registrar will invoke subsection
618(10)
3 of the Companies Act at the end of the period referred to under subsection 618(8).
5. What is the period for lodging this notification?
Answer: Pursuant to subsection 618(8), a company is required to submit the notice as follows:
(a) the date it is required to lodge its annual return after the end of the period referred to under subsection 618(3); or
(b) the expiry of 180 days after the end of the period referred to under subsection 618(3),
whichever is the earlier.
However it is advisable for a company to adhere to the following lodgement timeline:
| Anniversary Date |
Lodgement Period |
| Company having anniversary date on or before 30 June 2019 |
31 January 2019 till April 2019 |
| Company having anniversary date on or after 01 July 2019 |
2 May 2019 till 31 July 2019 |
(2) A new form,
Notice of Share Capital (under sections 618(8) and 618(9)), to be used to notify the Registrar of the changes
in equity structure of the company by comparing the position as of 30 January 2019 and 31 January 2019 respectively.
1 Section 618(8) of CA2016, inter alia, provides that a notice of share capital is to be filed with the Registrar: (a) at any time before (i) the date it is required to lodge its annual return after the end of the period referred to under section 618(3); or (ii) the expiry of 180 days after the end of the period referred to under section 618(3), whichever is the earlier; or (b) within such longer period as the Registrar may allow.
2 Section 618(9) of CA2016, inter alia, allows a company to file a notice of share capital earlier than the time frames referred to in section 618(8)(a) if the company: (a) has no amount standing to the credit in its share premium account; or (b) has utilised the amount standing to the credit of its share premium account under section 618(3).
3 Section 618(10) of CA2016, inter alia, provides that unless a company has filed a notice of its share capital under sections 618(8) or 618(9), the Registrar may for the purposes of the records maintained by him adopt, as the share capital of the company, the aggregate value of the shares issued by the company as that value appears in the Registrar’s records immediately after the end of the period referred to in section 618(8)(a) of CA2016.