The amount of indebtedness for the purposes of “inability to pay debts” under section 466(1)(a) of the Companies Act 2016 has been increased to an
amount exceeding RM50,000 from 1 January 2021 until 31 March 2021.
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This means that during the aforesaid period, 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The previous threshold of more than RM10,000 has been revoked with effect from 1 January 2021.
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Alert prepared by Rachel Ten (Senior Associate) of Skrine