Question 1

(1) What is a Private Limited Company (Sdn. Bhd.) ?

Accepted Answer

A Private Limited Company (otherwise known as Sdn. Bhd. in Malaysia A Sdn Bhd is a company limited by shares where its shareholder(s)’ liability is limited to the amount of shares held. It is a separate legal entity with full capacity to undertake business activities including to sue or be sued, manage property, and carry out business transactions.

Question 2

(2) Who can incorporate a Private Limited Company (Sdn. Bhd.) ?

Accepted Answer

To incorporate a Sdn Bhd, one must be at least 18 years old, reside in Malaysia, and is not disqualified under Section 198 of the Companies Act 2016.

Section 198 described that, a person shall not hold office as a Director of a Company or whether directly or indirectly be concerned with or takes part in the management of the Company , if the person
a) is an undischarged bankrupt,
b) has been convicted of an offence relating to the promotion, formation or management of corporation
c) has been convicted of an offence involving bribery, fraud or dishonesty
d) has been convicted of an offence under Section 213, 217, 218, 228 and 539 of Companies Act, 2016 or, 
e) has been disqualified by the court under Section 199 of Companies Act, 2016

Question 3

(3) How many Directors are needed to form a Sdn. Bhd.?

Accepted Answer

Only 1 director, who may also act as the sole shareholder of the company.

Question 4

(4) Can I incorporate a Sdn. Bhd. without having a Director residing in Malaysia?

Accepted Answer

Unfortunately, no. According to the Companies Act 2016, there must be at least 1 director who ordinarily resides in Malaysia in order to register a Sdn. Bhd. This could be yourself or other Directors of the business.

Question 5

(5) Can a Corporation be a shareholder in Sdn. Bhd.?

Accepted Answer

Yes. Shareholder can be the same person as Director, can be a different person from Director, can be a combination of individual and corporation and also can be a sole corporation.

Question 6

(6) How much is the minimum paid up capital to form a Sdn. Bhd.?

Accepted Answer

During the initial stage of formation, the maximum capital range may between RM1 to RM10,000.00. Proof of fund is required when Company wishes to increase its capital.

Question 7

(7) Can Company Increase the Capital after Incorporated?

Accepted Answer

Yes, the Company may do so provided bank account has successfully opened as bank statement is required to be shown as a proof fund injected to the Company bank account.

Question 8

(8) Must I appoint a Company Secretary?

Accepted Answer

According to Section 236 of the Companies Act 2016, all Sdn. Bhd. must appoint a company secretary within 30 days from its date of incorporation. Note that ASI will be automatically be appointed as the Company Secretaries when you engage us on Incorporation Services.

Question 9

(9) What are the roles and duties of the Company Secretary in my Company?

Accepted Answer

Besides assisting you with company registration, a Company Secretary is also responsible for:
a) Ensure the information of the Company, director(s) and shareholder(s) are kept up-to-date.
b) Advise the Company on compliance to various laws and regulations such as the Malaysian Companies Act 2016.
c) Lodge Annual Return and Financial Statements.
d) Keep meeting minutes and written resolutions of board meetings.
e) Handle striking off or winding up of the company.
f) Provide Certified True Copy (CTC) documents for opening bank account, grant application, etc.
g) Provide the registered office of the Company.

Question 10

(10) What is Registered Office and does it compulsory?

Accepted Answer

Registered office is address where all company documents, registers as ordered by the Companies Act 2016 need to be kept, must be located in Malaysia and open and accessible to the public during ordinary business hours. And by practice, Companies Secretary address is the registered office of the Company.

Question 11

(11) Is the Registered Address the same as my Company Business Address?

Accepted Answer

No, the Company’s registered address is not necessarily the same as its business address. A Company’s registered address is usually where the Company Secretary’s office is located at, which shall be open and accessible to the public during ordinary business hours. This is where all Company documents, as ordered by the Companies Act 2016, shall be kept at.
The Company may conduct business at any other address, which would then constitute as the business address.

Question 12

(12) Can the Business Address be the address for Registered Office?

Accepted Answer

Yes, possible. However, it is not advisable as to ensure that the registers which are required to be maintain under Companies Act 2016 is up to date.

Question 13

(13) I own an Enterprise, Partnership or Limited Liability Partnership. Can I convert any one of them to Sdn. Bhd.?

Accepted Answer

Switching the type of business structure is not possible as they are different entity. Nevertheless, one can incorporate a new Sdn. Bhd. and run the business as a new company before termination the existing Enterprise, Partnership or Limited Liability Partnership.

Question 14

(14) I own an existing Sdn. Bhd. or Limited Liability Partnership. Can I register a new Sdn. Bhd. using the same Company Name?

Accepted Answer

Unfortunately, no. A new Sdn. Bhd. shall not use the same name as any existing business entity even if they are owned by the same person. Any Company name that may create confusion with another Company’s that exists in the system is prohibited.

Question 15

(15) Can I close down my existing Sdn. Bhd. and register a new Sdn. Bhd. with the same name?

Accepted Answer

Yes, you can. However, there is a holding period of 2 years before the existing Sdn. Bhd. name can be re-used by a new entity again.

Question 16

(16) Should the Company adopts a Constitution?

Accepted Answer

A Company, may or may not have a constitution. Without its own constitution, the Company, Directors and Members shall have the rights, powers, duties, and obligations as set out in the Companies Act 2016. Based on the Companies Act 2016, a Company shall not be formed for any unlawful purpose. Hence, if a Company has adopted its down constitution, object clauses are now less significant and may or may not be specified in the constitution.