Penalty and Offences of Private Limited Company Sdn Bhd

While Malaysia Government welcomes foreigners to set-up their businesses in Malaysia with incorporating of a Private Limited (Sdn Bhd) Company in Malaysia, it is extremely important to know the compliance and datelines to comply to avoid any delays and late in filling of reporting to the Company Commission of Malaysia (CCM). Please be informed that these penalties and offenses imposed on foreigners apply same to all Malaysians.

Under the Company Act 2016, all business owners to comply with the Annual General Meeting (AGM), Submission of Annual Return and Audited Financial Statements as follows:

a)         SECTION 143(1)

This section provides that every Company is required to hold a  general meeting called “Annual General Meeting” (AGM) in each calendar year. The period between two AGMs must not be more than 15 months. The first AGM, however, can be held within the period of 18 months of its date of incorporation. If default is made in holding an AGM, the Company and every officer of the Company shall be guilty of an offense against this Act. 

Penalty: RM5,000

b)        SECTION 165(1) AND (4)

This section provides that every Company shall cause a return (Annual Return) as prescribed under Part II of the Eighth Schedule of the Companies Act, 1965 to be lodged with CCM within one month after the Annual General Meeting of the Company. If a Company fails to comply with this section, the Company and every officer of the Company who is in default shall be guilty of an offense against this Act. 

Penalty: RM2,000

c)         SECTION 169 (1)

This Section provides that the Directors of every Company shall at some date not later than 18 months after the incorporation of the Company and subsequently once in every calendar year at intervals of not more than 15 months lay before the Company’s AGM a profit and loss accounts (Audited Financial Statements) made up to a date not more than 6 months before the date of AGM. If any Director of a Company fails to comply or take all reasonable steps to secure compliance by the Company with the foregoing provisions shall be guilty of an offense against this Act.

Please note that a director has the fiduciary duty to ensure that all obligations of the company and the requirements set out in the Act, and related legislation and other relevant law are properly and fully complied with at all time.

Penalty: Imprisonment for 5 years or RM30,000

Feel free to contact us at +603 2181 2882 or email us at contact@malaysiabizadvisory.com on your business plan to ensure setting-up Malaysia Sdn Bhd Company is the right option, getting the right trade license and work permit for you and your employees.