LAWS OF MALAYSIA

ONLINE VERSION OF UPDATED

TEXT OF REPRINT

Act 441

LABUAN COMPANIES
ACT 1990
As at 10 June 2022

This text is ONLY AN UPDATED TEXT of the Labuan Companies Act 1990 by the Attorney
General’s Chambers. Unless and until reprinted pursuant to the powers of the Commissioner
of Law Revision under subsection 14(1) of the Revision of Laws Act 1968 [Act 1], this text is
NOT AN AUTHENTIC TEXT.
2

LABUAN COMPANIES
ACT 1990

Date of Royal Assent … … … 22 August 1990

Date of publication in the

Gazette … … … 30 August 1990

Latest amendment made by 10 June 2022;

Act A1653 which came into except subsection
operation on … … … 4(b) 1 January 2019

PREVIOUS REPRINTS

First Reprint … … … 2001

Second Reprint … … … 2006
 3

LAWS OF MALAYSIA

Act 441

LABUAN COMPANIES
ACT 1990

ARRANGEMENT OF SECTIONS

PART I

PRELIMINARY

Section

1. Short title
2. Interpretation
3. Definition of subsidiary and holding company
4. Related companies
5. (Deleted)
6. (Deleted)
7. Permitted purpose for incorporation

PART II

ADMINISTRATION OF ACT

8. Administration of Labuan companies

9. Lodging of documents
9A. Electronic lodgement or filing of documents
9 B. Evidentiary value of electronically lodged or filed documents
9 C. Original copies to be kept at office of trust company
9D. Issuing of document electronically
10. Approved auditors
4 Laws of Malaysia ACT 441

Section

11. Company auditors

12. Approved liquidator
13. Registers

PART III

CONSTITUTION OF COMPANIES

DIVISION 1

INCORPORATION

14. Formation of companies

15. Registration and incorporation
16. Application for registration of foreign company as being continued in
Labuan
17. Prior approval in principle
18. Requirements as to memorandum

DIVISION 2

STATUS AND NAME

19. Powers of companies

20. Ultra vires transactions
21. Names of Labuan companies
22. Change of name
23. Articles of association
24. Alteration of memorandum or articles
25. Copies of memorandum and articles
26. Transactions and establishment of a branch
27. Prohibition against carrying on business when Labuan company has no
members
 Labuan Companies 5

PART IV

SHARES, DEBENTURES AND CHARGES

DIVISION 1

PROSPECTUSES

Section

28. (Deleted)
29. (Deleted)
30. (Deleted)
31. (Deleted)
32. (Deleted)
33. (Deleted)
34. (Deleted)
35. (Deleted)
36. (Deleted)
37. (Deleted)
38. (Deleted)
39. (Deleted)

DIVISION 2

RESTRICTIONS ON ALLOTMENT

40. (Deleted)
41. (Deleted)
42. (Deleted)

DIVISION 3

SHARES

43. Return of allotment

44. Calls
45. Reserve liability
6 Laws of Malaysia ACT 441

Section

46. No par or nominal value shares

46A. Prohibition to issue bearer share or bearer share warrants
47. Power to issue shares and voting rights
47A. Treasury shares
48. Dealing by a Labuan company in its own shares, etc.
48A. Purchase by a Labuan company of its own shares, etc.
49. (Deleted)
50. (Deleted)
51. Alteration of share capital
52. Validation of shares improperly issued
53. Special resolution for reduction of share capital
54. Rights of holders of preference shares to be set out in articles
55. Redeemable preference shares

DIVISION 4

DEBENTURES

56. (Deleted)
57. (Deleted)
58. Labuan company to maintain register of debentures holders
59. Perpetual debentures
60. Reissue of redeemed debentures
61. (Deleted)
62. (Deleted)
63. (Deleted)
64. (Deleted)
65. (Deleted)

DIVISION 5

INTERESTS OTHER THAN SHARES, DEBENTURE, ETC.

66. Interpretation
 Labuan Companies 7
Section

67. Approved deeds

68. Approval of deeds
69. Interests to be issued by a Labuan company or a foreign Labuan
company only
70. Statement to be issued
71. No issue without approved deed
72. Register of interest holders
73. Penalty for contravention of Division, etc.
74. Winding up of schemes, etc.
75. Liability of trustees

DIVISION 6

TITLE AND TRANSFERS

76. Nature of shares

77. Numbering of shares
78. Certificate to be evidence of title
79. A Labuan company may have share seal
80. Instruments of transfer and transfer by personal representative
81. Duties of Labuan company with respect to issue of certificate

DIVISION 7

REGISTER OF CHARGES

82. Non-application of Division

83. Register of charges
84. Notice of creation and satisfaction of charge
84A. Assignment and variation of charge
8 Laws of Malaysia ACT 441

PART V

MANAGEMENT AND ADMINISTRATION

DIVISION 1
OFFICE AND NAME

Section

85. Registered office of a Labuan company

86. Name to be displayed at all offices and to appear on seals, letters, etc.

DIVISION 2

DIRECTORS AND OFFICERS

86. Name to be displayed at all offices and to appear on seals, letters, etc.
87. Directors
88. Consent to act as director
89. Validity of acts of directors
90. Persons disqualified from being a director
91. Disclosure of interest in contracts, property, offices, etc.
92. Duty and liability of officers
93. Secretary
94. Register of directors and secretaries
94A. Offence against any provision of this Act committed by directors and
secretaries
94B. Removal of director

DIVISION 3

MEETINGS AND PROCEEDINGS

95. Meetings of members

96. Notice of meetings of members
97. Quorum, chairman, voting, etc., at meetings
98. Voting by members
99. Action by consent of members in writing
 Labuan Companies 9
Section

100. Power of Court to direct meetings to be called

101. Special resolution
101A. Resolutions signed by all members deemed to be duly passed at
meeting
102. Resolution requiring special notice
103. (Deleted)
104. Minutes of proceedings

DIVISION 4

REGISTER OF MEMBERS

105. Register of members

106. Where register to be kept
107. Consequences of default by agent
108. Power of Court to rectify register
108A. Beneficial ownership of Labuan company
108B. Power of company to require disclosure of beneficial ownership
information
108C. Duty to lodge information with the Authority
108D. Particulars of beneficial ownership
108E. Obligation of Labuan company to maintain and keep information up to
date
108F. Power of Authority to require submission and examination
108G. Power of Authority to issue guidelines
108H. Removal of entries from register

DIVISION 5

ANNUAL RETURN

109. Annual return

10 Laws of Malaysia ACT 441

PART VI

ACCOUNTS AND AUDIT

DIVISION 1

ACCOUNTS

Section

110. Accounts to be kept

111. Audited accounts to be laid before meeting
112. Audited accounts to be sent to members

DIVISION 2

AUDIT

113. Auditor to be appointed

113A. (Deleted)
114. Removal and resignation of auditors
115. Remuneration of auditor
116. Auditor may attend meetings
117. Rights and duties of auditors

PART VII

ARRANGEMENTS AND RECONSTRUCTIONS

118. Arrangements
118A. Amalgamations
118B. Amalgamation of a Labuan company, a foreign Labuan company or a
corporation and continuation as a Labuan company
118C. Short form amalgamation
118D. Effect of amalgamation
119. Regulations in respect of takeover, merger and amalgamation
 Labuan Companies 11

PART VIII

FOREIGN LABUAN COMPANIES

Section

120. Interpretation
121. Registration of foreign Labuan companies
122. Prohibition and restriction on foreign Labuan company
123. Registered office of foreign Labuan companies
124. Return to be lodged where documents, etc., altered
125. Service on foreign Labuan companies
126. Cessation of business in Labuan
127. Liquidation or dissolution of company in place of incorporation,
establishment or origin
128. Names of foreign Labuan companies
129. Returns by foreign Labuan companies
130. Application of this Part to certain foreign companies registered under
Companies Act 2016

PART VIIIA

COMPANY MANAGEMENT

130A. (Deleted)
130B. (Deleted)
130C. (Deleted)
130D. (Deleted)
130E. (Deleted)
130F. (Deleted)
130G. (Deleted)
130H. (Deleted)
130I. (Deleted)
130J. (Deleted)
130K. (Deleted)
130L. (Deleted)
12 Laws of Malaysia ACT 441

Section

130M. (Deleted)

PART VIIIB

LABUAN PROTECTED CELL COMPANIES

130N. Interpretation
130O. Labuan protected cell companies
130P. Approval of the Authority
130Q. Incorporation of, or conversion into, a Labuan protected cell company
130R. Name and memorandum or articles of a Labuan protected cell
company
130S. Cell and general assets
130T. Cell shares and cell share capital
130U. Register of shareholders
130V. Reduction of cell capital
130W. Rights of creditors
130X. Liabilities
130Y. Disclosure
130Z. Dealings and transactions between cell assets
130ZA. Transfer of cell assets
130ZB. Receivership and winding up of Labuan protected cell company and
cell liquidation
130ZC. Application of this Act

PART IX

RECEIVERSHIP AND WINDING UP

131. Receivership and winding up

131A. Alternative procedure for voluntary winding up of solvent Labuan
companies
 Labuan Companies 13

PART X

MISCELLANEOUS

Section

132. Service of documents on companies

133. Transfer from Labuan
134. Costs of proceedings before the Court
135. Security for costs
136. Disposal of shares of shareholder whose whereabouts are unknown
137. Power to grant relief
137A. Injunctions
138. Irregularities in proceedings
139. Translation of instruments
140. Dividends payable from profits only
141. Use of word “Corporation”, etc.
142. Penalties
142A. Power to impose administrative penalties
143. (Deleted)
144. Compounding of offences
145. Procedure where none laid down
146. Power of the Minister to make regulations
147. (Deleted)
148. Prohibition by Minister
149. Secrecy
150. Power of the Minister to grant exemptions
151. Annual fee
151A. Company struck off liable for fees, etc.
151B. Fees payable to Registrar
151BA. Power of Authority to strike off Labuan company
151BB. Notice of intention to strike off Labuan company
151C. Effect of striking off
14 Laws of Malaysia ACT 441

Section

151D. Dissolution of a Labuan company

151E. Letter of confirmation and letter of good standing
152. Non-application of specified written laws
153. Application of specified written laws
SCHEDULE (Deleted)
 15

LAWS OF MALAYSIA

Act 441

LABUAN COMPANIES ACT 1990

An Act to provide for the incorporation, registration and

administration of Labuan companies and foreign Labuan companies
and for matters connected therewith.

[1 October 1990, P.U. (B) 591/1990]

BE IT ENACTED by the Seri Paduka Baginda Yang di-Pertuan

Agong with the advice and consent of the Dewan Negara and Dewan
Rakyat in Parliament assembled, and by the authority of the same, as
follows:

PART I

PRELIMINARY

Short title

1. This Act may be cited as the Labuan Companies Act 1990.

Interpretation

2. (1) In this Act, unless the context otherwise requires —

“allot” includes sell, issue, assign, and convey; and “allotment” has
a corresponding meaning;

“annual fee payment date” means the date on which the annual fee
of a Labuan company shall be payable pursuant to subsection 151(1);
16 Laws of Malaysia ACT 441

“annual return” means the return required to be made by a Labuan

company under section 109 and includes any document
accompanying the return;

“approved auditor” means a person approved under

subsection 10 (1);

“approved liquidator” means a person approved under

subsection 12(1);

“Authority” means the Labuan Financial Services Authority

established under section 3 of the Labuan Financial Services
Authority Act 1996 [Act 545];

“authorized officer” means an officer duly authorized by the

Authority;

“books” includes any register or other record of information and

any accounts or accounting records, however compiled, recorded or
stored, and also includes any document;

“certified” means certified in the prescribed manner to be a

particular document or to be a true copy thereof;

“charge” includes a mortgage and any agreement to give or execute

a charge or mortgage whether upon demand or otherwise;

“company limited by guarantee” means a company formed on the

principle of having the liability of its members limited by its
memorandum to such amount as the members may respectively
undertake to contribute to the assets of the company in the event of it
being wound up;

“company limited by shares” means a company formed on the

principle of having the liability of its members limited by its
memorandum to the amount, if any, unpaid on the shares respectively
held by them;
 Labuan Companies 17

“contributory”, in relation to a Labuan company, means a person

liable to contribute to the assets of the company in the event of its
being wound up, and includes the holder of fully paid shares in the
company and, prior to the final determination of the persons who are
contributories, includes any person alleged to be a contributory;

“corporation” means a body corporate formed, incorporated or

existing within Malaysia or outside Malaysia and includes a foreign
Labuan company but does not include—

(a) a corporation sole;

(b) a trade union registered under any written law as a trade

union; or

(c) a society registered under any written law relating to co-

operative societies;

“Court” means the High Court or a judge thereof;

“court” means a court of competent jurisdiction;

“debenture” includes debenture stock, bonds, notes and any other

evidence of indebtedness of a corporation for borrowed monies,
whether or not constituting a charge on the assets of the corporation,
but shall not be construed as applying to any of the following:

(a) an instrument acknowledging or creating indebtedness for,

or for money borrowed to defray the consideration payable
under, a contract for sale or supply of goods, property or
services or any contract for hire in the ordinary course of
business;

(b) a cheque, banker’s draft or any other bill of exchange or

letter of credit;

(c) a banknote, guarantee or an insurance policy;

18 Laws of Malaysia ACT 441

(d) a statement, passbook or other document showing any

balance in a current, deposit or savings account;

(e) an agreement for a loan where the lender and borrower are
signatories to the agreement and where the lending of
money is in the ordinary course of business of the lender,
and any such promissory note issued under the terms of
such an agreement; or

(f) an instrument or product or class of instruments or products

as the Minister may, on the recommendation of the
Authority, prescribed by order published in the Gazette;

“director” means any person, by whatever name called, occupying

the position of director of a Labuan company or a foreign Labuan
company, and includes a person in accordance with whose directions
or instructions the directors of such a company are accustomed to act
and an alternate or substitute director;

“document” includes summons, order and other legal process, and

notice and register;

“domestic company” means a company incorporated under the

Companies Act 2016 [Act 777];

“expert” includes engineer, valuer, accountant, solicitor, auditor

and any other person whose profession or reputation gives authority
to a statement made by him;

“foreign company” means —

(a) a company, corporation, society, association or other body

incorporated outside Malaysia; or

(b) an unincorporated society, association or other body which

under the law of its place of origin may sue or be sued, or
hold property in the name of the secretary or other officer of
the society, association or body duly appointed for that
 Labuan Companies 19

purpose, and which does not have its head office or

principal place of business in Malaysia;

“foreign Labuan company” means a foreign company registered

under Part VIII;

“Labuan” means the Federal Territory of Labuan;

“Labuan company” means a company incorporated or registered

under this Act;

“Labuan protected cell company” means a company incorporated

as, or converted into, a protected cell company in accordance with the
provisions of Part VIIIB of this Act;

“Labuan trust company” means a corporation registered as a

Labuan trust company under the Labuan Financial Services and
Securities Act 201 [Act 704];

“lodged” means lodged in accordance with the provisions of this

Act;

“memorandum”, in relation to a Labuan company, means the

memorandum of association of that company for the time being in
force; and, in relation to a foreign Labuan company, means the
charter, statute, memorandum of association or instrument
constituting or defining the constitution of the company;

“Minister” means the Minister for the time being charged with the
responsibility for finance;

“month” means a period of thirty days;

“officer”, in relation to a Labuan company or a foreign Labuan

company, includes —

(a) any director, secretary or employee of the company;

20 Laws of Malaysia ACT 441

(b) any receiver and manager of any part of the undertaking of

the company appointed under a power contained in any
instrument; and

(c) any liquidator of the company appointed in a voluntary

winding up,

but does not include —

(d) any receiver who is not also a manager;

(e) any receiver and manager appointed by the Court; or

(f) any liquidator appointed by the Court or by the creditors;

“person” includes a corporation, partnership, a body of persons and

a corporation sole;

“post” includes communication by mail, courier, freight, telex or

facsimile;

“printed” includes typewritten or lithographed or reproduced by

any mechanical means;

“prescribed”, where no mode is mentioned, means prescribed from

time to time by order published in the Gazette, and a power to
prescribe includes the power to make different provisions in the order
for different persons or different classes, categories or descriptions of
persons;

“regulations” means regulations under this Act;

“resident” means—

(a) in relation to a natural person, a citizen or permanent

resident of Malaysia; or

(b) in relation to any other person, a person who has established

a place of business, and is operating, in Malaysia,
 Labuan Companies 21

and includes a person who is declared to be a resident pursuant to

paragraph 214(6)(a) of the Financial Services Act 2013 [Act 758] and
paragraph 225(6)(a) of the Islamic Financial Services Act 2013
[Act 759];

“ringgit” means a ringgit in the currency of Malaysia;

“serious offence involving fraud or dishonesty” means an offence

that is punishable by imprisonment for a term that is not less than two
years or, where there is a loss of the value of assets derived or likely
to be derived suffered by the company, member or debenture holder
from the commission of such an offence, the loss exceeds two
hundred and fifty thousand ringgit;

“share”, in relation to a Labuan company, means a share in the

share capital of that company, and includes stock;

“solvency declaration” means a declaration of solvency by the

directors of a Labuan company or foreign Labuan company, as and
when required by the provisions of this Act, and is deemed to be a
statutory declaration within the meaning and effect under the
*Statutory Declarations Act 1960 [Act 60] and the Penal Code
[Act 574];

“specify”, where no mode is mentioned in this Act, means specify

from time to time in writing, and a power to specify includes the
power to specify differently for different persons or different classes,
categories and descriptions of persons;

“treasury share” means a share of a corporation that was previously

issued but was repurchased, redeemed or otherwise acquired by the
corporation and not cancelled;

“unlimited company” means a company formed on the principle of

having no limit placed on the liability of its members.

*NOTE—Statutory Declarations Act 1960 [Act 60] has since been superceded by the Statutory
Declarations Act 1960 [Act 783] which comes into operation on 17 November 2016.
22 Laws of Malaysia ACT 441

(2) For the purposes of this Act, a person shall be deemed to hold
a beneficial interest in a share—

(a) if that person, either alone or together with other persons, is

entitled (otherwise than as a trustee for, on behalf of, or on
account of, another person) to receive, directly or indirectly,
any dividends in respect of the share or to exercise, or to
control the exercise of, any rights attaching to the shares; or

(b) if that person, being a corporation, holds any beneficial

interest in a share of another corporation which holds, or a
subsidiary of which holds, any beneficial interest in the
first-mentioned share.

(3) Whenever in this Act any person holding or occupying a

particular office or position is mentioned or referred to, such mention
or reference shall, unless the contrary intention appears, be taken to
include all persons who shall at any time thereafter occupy for the
time being the said office or position.

(4) Any provision of this Act overriding or interpreting a

corporation’s articles shall, except where otherwise provided by this
Act, apply in relation to articles in force at the commencement of this
Act, as well as to articles coming into force thereafter, and shall apply
also in relation to a corporation’s memorandum as it applies in
relation to its articles.

Definition of subsidiary and holding company

3. (1) For the purposes of this Act, a corporation shall, subject to

the provisions of subsection (3), be deemed to be a subsidiary of
another corporation if—

(a) that other corporation —

(i) controls the composition of the board of directors of

the first-mentioned corporation;
 Labuan Companies 23

(ii) controls more than half of the voting power of the

first- mentioned corporation; or

(iii) holds more than half of the issued share capital of the
first-mentioned corporation (excluding any part
thereof which carries no right to participate beyond a
specified amount in a distribution of either profits or
capital); or

(b) the first-mentioned corporation is a subsidiary of any

corporation which is that other corporation’s subsidiary.

(2) For the purposes of subsection (1), the composition of a

corporation’s board of directors shall be deemed to be controlled by
another corporation if that other corporation, by the exercise of some
power exercisable by it without the consent or concurrence of any
other person, can appoint or remove all or a majority of the directors,
and for the purposes of this provision that other corporation shall be
deemed to have power to make such an appointment if—

(a) a person cannot be appointed as a director without the

exercise in his favour by that other corporation of such a
power; or

(b) a person’s appointment as a director follows necessarily

from his being a director or other officer of that other
corporation.

(3) In determining whether one corporation is a subsidiary of

another corporation —

(a) any shares held or power exercisable by that other

corporation in a trustee or fiduciary capacity shall be treated
as not held or exercisable by it;

(b) subject to paragraphs (c) and (d), any shares held or power
exercisable —
24 Laws of Malaysia ACT 441

(i) by any person as a nominee for that other corporation

(except where that other corporation is concerned
only in a trustee or fiduciary capacity); or

(ii) by, or by a nominee for, a subsidiary of that other

corporation, not being a subsidiary which is
concerned only in a trustee or fiduciary capacity,

shall be treated as held or exercisable by that other corporation;

(c) any shares held or power exercisable by any person by

virtue of the provisions of any debentures of the first
mentioned corporation or of a trust deed for securing any
issue of such debentures shall be disregarded; and

(d) any shares held or power exercisable by, or by a nominee

for, that other corporation or its subsidiary (not being held
or exercisable as mentioned in paragraph (c) shall be treated
as not held or exercisable by that other corporation if the
ordinary business of that other corporation or its subsidiary,
as the case may be, includes the lending of money and the
shares are held or power is exercisable as aforesaid by way
of security only for the purposes of a transaction entered
into in the ordinary course of that business.

(4) A reference in this Act to the holding company of a

corporation shall be read as a reference to a corporation of which the
last-mentioned corporation is a subsidiary.

Related companies

4. Where a corporation —

(a) is the holding company of another corporation;

(b) is a subsidiary of another corporation; or

 Labuan Companies 25

(c) is a subsidiary of the holding company of another

corporation,

that first-mentioned corporation and that other corporation shall for

the purposes of this Act be deemed to be related to each other.

5. (Deleted by Act A1367).

6. (Deleted by Act A1367).

Permitted purpose for incorporation

7. (1) A Labuan company may be incorporated for any lawful

purpose and, subject to any other written laws on financial services
applicable to Labuan, shall carry out business only in, from or
through Labuan.

(2) Subject to subsection (3), a Labuan company may carry on a

business with a resident.

(3) No Labuan company shall—

(a) issue or offer to any resident for subscription or purchase; or

(b) invite any resident to subscribe or purchase,

any interest pursuant to the relevant provisions of the Interest

Schemes Act 2016 [Act 778] where such issue or offer or invitation is
made in Malaysia, other than Labuan, unless the provisions of the
Interest Schemes Act 2016 are complied with.

(4) (Deleted by Act 1653).

(5) (Deleted by Act 1653).

(6) (Deleted by Act 1653).

26 Laws of Malaysia ACT 441

PART II

ADMINISTRATION OF ACT

Administration of Labuan companies

8. (1) The Authority is responsible for the due administration of

this Act, and subject to the general direction and control of the
Authority and to such restrictions and limitations as may be
prescribed, anything which is required by this Act to be appointed,
authorized, done or signed by the Authority may be appointed,
authorized, done or signed by an authorized officer of the Authority
and shall be as valid and effectual as if appointed, authorized, done or
signed by the Authority.

(2) No person dealing with any authorized officer of the Authority

shall be concerned to see or inquire whether any restrictions or
limitations have been prescribed, and every act or omission of the
authorized officer, so far as the act or omission affects any such
person, shall be as valid and effectual as if done or omitted by the
Authority.

(3) All courts, judges and persons acting judicially shall take
judicial notice of the seal of the Authority.

(4) For the purpose of ascertaining whether a Labuan company or

a foreign Labuan company is complying with this Act, the Authority
or any authorized officer may require the Labuan company or the
foreign Labuan company or any officer of the Labuan company or the
foreign Labuan company to produce any book, minute book, register
or record required to be kept by the company under or by this Act for
the Authority’s or the authorized officer’s inspection.

(5) A Labuan company, foreign Labuan company or any officer of

the company shall, on being required by the Authority or any
authorized officer to do so under subsection (4), produce such book,
minute book, register or record.
 Labuan Companies 27

(6) The Labuan company, foreign Labuan company or any officer

of the company shall not obstruct or hinder the Authority or any
authorized officer of the Authority while exercising any of the
powers referred in subsection (4).

(6A) If default is made in complying with this section, the Labuan

company, foreign Labuan company and every officer of the company
who is in default commits an offence under this Act.

Penalty: Five hundred thousand ringgit or imprisonment for one

year or both.

(7) A Labuan company or a foreign Labuan company shall pay to

the Authority such fees as may be prescribed.

Lodging of documents

9. (1) Every document required or permitted to be lodged or filed

with the Authority under the provisions of this Act shall be lodged or
filed through a Labuan trust company or any other entity which may
be approved by the Authority.

(2) Every application to the Authority for any certificate to be

issued under this Act or for any extract or copy of any certificate
issued under this Act or of any document lodged or filed with the
Authority shall be made through a Labuan trust company or any other
entity which may be approved by the Authority:

Provided that this subsection shall not apply—

(a) where an application is made in respect of a Labuan

company or a foreign Labuan company by a member of that
company and the document, certificate, extract or copy is
for his own personal use; or

(b) where an application is made by a Labuan company or a

foreign Labuan company for a licence for the purpose of
undertaking or offering to undertake the business of a
28 Laws of Malaysia ACT 441

management company under Part VIII of the Labuan

Financial Services and Securities Act 2010 or an approved
liquidator where a Labuan company or foreign Labuan
company is under liquidation.

Electronic lodgement or filing of documents

9A. (1) The Authority may provide a service for the electronic
lodgement or filing of documents required by this Act to be lodged or
filed with the Authority.

(2) A Labuan trust company or any other person approved by the

Authority shall become a subscriber to the service provided under
subsection (1) and shall pay the prescribed fee and comply with such
terms and conditions as may be determined by the Authority.

(3) A document electronically lodged or filed under this section

shall be deemed to have satisfied the requirement for lodgement or
filing if the document is communicated or transmitted to the
Authority in such manner as may be specified or approved by the
Authority.

(4) The Authority may, by notice in writing, specify the

documents that may be electronically lodged or filed.

(5) A document that is required to be certified or authenticated

shall, if it is to be electronically lodged or filed, be certified or
authenticated in such manner as may be specified or approved by the
Authority.

(5A) Notwithstanding subsection (5), a document which is signed

electronically may not be required to be certified or authenticated as
required under that subsection.

(6) Where a document is electronically lodged or filed with the

Authority, the Authority or its authorized agents shall not be liable
for any loss or damage suffered by any person by reason of any error
or omission of whatever nature or however arising appearing in any
 Labuan Companies 29

document obtained by any person under the service referred to in

subsection (1) if such error or omission was made in good faith and
in the ordinary course of the discharge of the duties of the
Authority or of its authorized agents or occurred or arose as a result
of any defect or breakdown in the service or in the equipment used
for the provision of the service.

(7) Where a document is electronically lodged or filed in place of

a statutory declaration, there must be lodged or filed electronically
with the Authority a declaration in the manner prescribed by the
Authority, and such declaration shall be deemed to be a declaration
under sections 199 and 200 of the Penal Code.

(8) Where a document electronically lodged or filed does not

comply with the provisions relating to electronic filing under this
Act, the Authority has the right to serve a notice on the Labuan trust
company for the non-compliance, and if a replacement document is
lodged or filed within the prescribed time, the replacement document
shall be deemed to be lodged or filed in accordance to the
requirement of this Act, and no penalty shall be imposed during this
prescribed period.

Evidentiary value of electronically lodged or filed documents

9B. (1) A copy of or an extract from any document electronically

lodged or filed with the Authority under section 9A duly certified by
the Authority as a true copy of or extract from that document shall be
admissible in evidence in any proceedings as of equal validity as the
original document.

(2) Nothing in subsection (1) shall be deemed to be inconsistent

with sections 90A, 90B and 90C of the Evidence Act 1950, and the
“person responsible for the management of the operation of the
computer” shall for the purposes of this section be deemed to be the
Authority.
30 Laws of Malaysia ACT 441

Original copies to be kept at office of trust company

9C. (1) The original copies of the documents specified or approved

by the Registrar to be electronically lodged or filed with the
Authority by the Labuan trust company shall, at all times, be kept at
the office of the trust company.

(2) A trust company that fails to comply with

subsection (1) commits an offence under this Act.

Penalty: Ten thousand ringgit. Default penalty.

Issuing of document electronically

9D. (1) The Authority may, by electronic means, issue any

document required to be issued by it.

(2) A copy of or an extract from any document electronically

issued by the Authority under subsection (1), duly certified by the
Authority as a true copy of or an extract from such document, shall
be admissible in evidence in any proceedings as of equal validity as
the original document.

(3) Nothing in subsection (2) shall be deemed to be inconsistent

with sections 90A, 90B and 90C of the Evidence Act 1950, and the
“person responsible for the management of the operation of the
computer” shall for the purposes of this section be deemed to be the
Authority.

Approved auditors

10. (1) Subject to such conditions as the Authority deems fit to

impose, the Authority may approve any person to be an approved
auditor for the purposes of this Act.

(2) No person shall perform the duties of auditor of a

Labuan company unless he is an approved auditor.
 Labuan Companies 31

(2A) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: One hundred thousand ringgit.

(3) The Authority may revoke any approval given under

subsection (1).

(4) The Authority shall keep a register of approved auditors.

(5) An approved auditor shall pay to the Authority such annual fee
as may be prescribed.

(6) An approved auditor shall lodge or file any document required

to be lodged or filed under this Act within the stipulated period.

(7) An approved auditor who fails to pay the annual fee as

required under subsection (5) or fails to lodge or file any documents
as required under subsection (6) commits an offence under this Act.

Company auditors

11. (1) A person shall not knowingly consent to be appointed, and

shall not knowingly act, as auditor for any Labuan company under
this Act and shall not prepare for or on behalf of the company any
report required by this Act to be prepared by an approved auditor—

(a) if he is not an approved auditor;

(b) if he is indebted to the company or to a company which is

deemed to be related to that company by virtue of
section 4 in an amount exceeding twenty thousand ringgit or
an equivalent amount in any other currency;

(c) if he is —

(i) an officer of the company;

32 Laws of Malaysia ACT 441

(ii) a partner, employer or employee of an officer of the

company;

(iii) a partner, or employee of an employee of an officer of

the company;

(iv) a spouse of an officer of the company;

(v) a spouse of an employee of an officer of the company;

or

(vi) a shareholder, or the spouse of a shareholder, of a

corporation whose employee is an officer of the
company; or

(d) if he is responsible for, or if he is the partner, employer or

employee of a person responsible for, the keeping of the
register of members or the register of holders of debentures
of the company.

(2) For the purposes of subsection (1), a person shall be deemed to

be an officer of a Labuan company if he is an officer of a company
that is deemed to be related to the Labuan company by virtue of
section 4 or he has, at any time within the preceding period of twelve
months, been an officer or promoter of the Labuan company or of the
other company.

(3) For the purposes of this section, a person shall not be deemed
to be an officer by reason only of his having been appointed as
auditor of a company.

(4) No person shall appoint a person as auditor of a Labuan

company unless the person to be appointed auditor has, prior to such
appointment, consented in writing to act as such auditor.

(5) The Minister may make regulations requiring approved

auditors to insure against their liabilities as auditors of Labuan
companies.
 Labuan Companies 33

(6) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: One hundred thousand ringgit.

Approved liquidator

12. (1) Subject to such conditions and payment of the prescribed

fee as the Authority deems fit to impose, the Authority may approve
any person to be an approved liquidator.

(2) The Authority may revoke any approval given under

subsection (1).

(3) The Authority shall keep a register of approved liquidators.

(4) No person shall be appointed or shall act as liquidator of a

Labuan company—

(a) if he is not an approved liquidator;

(b) if he is indebted to the company in liquidation or to a

company which is deemed to be related to that company in
liquidation by virtue of section 4 in an amount exceeding
twenty thousand ringgit or an equivalent amount in any
other currency; or

(c) if he has not consented in writing to such appointment.

(4A) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: Fifty thousand ringgit or imprisonment for a term not

exceeding three years or both.

(5) Where an approved liquidator is appointed to be a liquidator of

a Labuan company, whether by the Court or in a voluntary winding
up, he shall forthwith notify the Authority in writing of any interest
34 Laws of Malaysia ACT 441

which he has in the Labuan company as an officer, employer or

employee of the Labuan company or as a partner, employer or
employee of an officer of the Labuan company, and any interest
which any company related to him has in the Labuan company.

(6) An approved liquidator shall lodge or file any document

required to be lodged or filed under this Act within the stipulated
period.

(7) An approved liquidator who fails to comply with

subsection (6) commits an offence under this Act.

Registers

13. (1) The Authority shall keep such registers as it considers

necessary in any form as it deems fit.

(2) Any officer, member, debenture-holder, director or liquidator

of a Labuan company or a foreign Labuan company, or any other
person having the written permission of such officer, member,
debenture-holder, director or liquidator or who can demonstrate to the
Authority that he has a good reason for doing so, may, subject to this
Act and on payment of the prescribed fee —

(a) inspect any document filed or lodged with the Authority in

respect of the company; or

(b) require any certificate to be issued under this Act or a copy

or extract from any document in respect of the company to
be given or given and certified by the Authority.

(3) A copy of or extract from any document filed or lodged at the

office of the Authority, certified to be a true copy or extract under the
hand and seal of the Authority, shall, in any proceedings, be
admissible in evidence as of equal validity with the original
document.

(4) In any legal proceedings—

 Labuan Companies 35

(a) a certificate under the hand and seal of the Authority that, at
a date or during a period specified in the certificate, no
company was registered under this Act by a name specified
in the certificate shall be received as prima facie evidence
that at the date or during that period, as the case may be, no
company was registered by that name under this Act; and

(b) a certificate under the hand and seal of the Authority that a
requirement of this Act specified in the certificate —

(i) had or had not been complied with at a date or within

a period specified in the certificate; or

(ii) had been complied with at a date specified in the

certificate but not before that date,

shall be received as prima facie evidence of matters specified in the

certificate.

(5) If the Authority is of the opinion that a document submitted for

lodgement with the Authority —

(a) contains matter contrary to law;

(b) contains matter that, in a material particular, is false or

misleading in the form or context in which it is included;

(c) by reason of an omission or misdescription has not been

duly completed;

(d) does not comply with the requirements of this Act; or

(e) contains an error, alteration or erasure,

the Authority may refuse to register or receive the document and may
request—

(f) that the document be appropriately amended or completed

and re-submitted;
36 Laws of Malaysia ACT 441

(g) that a fresh document be submitted in its place; or

(h) where the document has not been duly completed, that a
supplementary document in the prescribed form be lodged.

(6) The Authority may require a person who submits a document

for lodgement with the Authority to produce to the Authority such
other document, or to furnish to the Authority such information, as
the Authority thinks necessary in order to form an opinion whether
the Authority may refuse to receive or register the document.

(6A) The registration or receiving of a document, or the refusal to

register or receive a document, by the Authority shall not —

(a) affect the validity of the document; or

(b) create a presumption as to the correctness of the information

contained in the document.

(6B) Subject to subsections (6C) and (7), the Authority may

remove a document already lodged with it if the Authority has
reasonable grounds to believe that the document is contrary to law or
does not comply with the material requirements of this Act.

(6C) The Authority shall provide the person who lodged the
document referred to in subsection (6B) an opportunity to show cause
as to why the document should not be removed.

(7) Any person aggrieved by the refusal of the Authority to

register a Labuan company or a foreign Labuan company or to
register or receive any document, or by any act or decision of the
Authority, may appeal within thirty days of the decision of the
Authority to the Minister, who may confirm the refusal, act or
decision or give such directions in the matter as he deems proper or
otherwise determine the matter but this subsection shall not apply to
any act or decision of the Authority—

(a) in respect of which any provision in the nature of appeal or

review is expressly provided in this Act; or
 Labuan Companies 37

(b) which is declared by this Act to be conclusive or final or is

embodied in any document declared by this Act to be
conclusive evidence of any act, matter or thing.

(8) If a Labuan company or a foreign Labuan company or person,

having made default in complying with—

(a) any provision of this Act or of any other law which requires
the lodging or filing in any manner with the Authority of
any return, account or other document or giving of notice to
the Authority of any matter; or

(b) any request of the Authority to amend or complete and re-

submit any document or submit a fresh document,

fails to make good the default within thirty days after the service on
the company or person of a notice requiring it to be done, the
Authority may order the company and any officer thereof or such
person to make good the default within such time as is specified in
the order.

(9) The Authority may, if in its opinion it is no longer necessary

or desirable to retain them, destroy or give to the National
Archives—

(a) in the case of a Labuan company or a foreign Labuan

company—

(i) any return of allotment of shares for cash which has

been lodged or filed for not less than seven years;

(ii) any annual return or balance sheet that has been

lodged or filed for not less than seven years or any
document creating or evidencing a charge or the
complete or partial satisfaction of a charge where a
memorandum of satisfaction of the charge has been
registered for not less than seven years; or
38 Laws of Malaysia ACT 441

(iii) any other document (other than the memorandum and

articles or any other document affecting them) which
has been lodged, filed or registered for not less than
seven years;

(b) in the case of a Labuan company or a foreign Labuan

company that has been dissolved or has ceased to be
registered for not less than seven years and six months, any
document lodged, filed or registered; or

(c) any document a transparency of which has been

incorporated with a register kept by the Authority.

PART III

CONSTITUTION OF COMPANIES

DIVISION I

INCORPORATION

Formation of companies

14. (1) Subject to this Act, a Labuan trust company or any other
person may, by subscribing its or his name to a memorandum and
complying with the requirements as to registration, form a Labuan
company for any lawful purpose.

(2) If a subscriber to a memorandum is a corporation or a Labuan

trust company, the memorandum may be subscribed by the
corporation or the Labuan trust company, as the case may be, under
its seal or by some person duly authorized on its behalf.

(3) A Labuan company may be—

(a) a company limited by shares;

(b) a company limited by guarantee; or

 Labuan Companies 39

(c) an unlimited company.

Registration and incorporation

15. (1) A person desiring the incorporation of a Labuan company

shall lodge with the Authority the memorandum and articles of the
proposed company and the other documents required to be lodged by
or under this Act, and the Authority on payment of the prescribed
fees shall, subject to this Act, register the company by registering the
memorandum and articles.

(2) The Authority may require a statutory declaration made by an

officer to be lodged stating that all or any of the requirements of this
Act have been complied with, and the Authority may accept such a
declaration as sufficient evidence of compliance.

(3) On the registration of the memorandum, the Authority shall

certify under its seal that the company is, on and from the date
specified in the certificate, incorporated as a Labuan company limited
by shares or guarantee or is an unlimited company.

(4) On and from the date of incorporation specified in the

certificate of incorporation, but subject to this Act, the subscribers to
the memorandum together with such other persons as may from time
to time become members of the company shall be a body corporate
by the name contained in the memorandum, capable forthwith of
exercising all the functions of an incorporated company, and of suing
and being sued, and having perpetual succession and a common seal,
with power to hold land but with such liability on the part of the
members to contribute to the assets of the company in the event of its
being wound up as is provided by this Act.

(5) A certificate of incorporation of a company issued by the

Authority shall be prima facie evidence of compliance with all the
requirements of this Act in respect of incorporation.

(6) (Deleted by Act A1367).

40 Laws of Malaysia ACT 441

(7) Every subscriber to the memorandum shall be deemed to have

agreed to become a member of a Labuan company and, on the
incorporation of the company, shall be entered as a member in its
register of members in respect of the shares subscribed for or by him
in the memorandum or his contribution to the capital of the company,
and every other person who agrees to be a member of a company and
whose name is entered into the register of members shall be a
member of the company.

(8) The Authority may, from time to time, issue directions,

guidelines or requests as it considers necessary in respect of the
registration and incorporation of a Labuan company, including —

(a) the form of notices required to be given to the Authority

under this Act; and

(b) the procedure to be followed in the registration of

documents under this Act.

Application for registration of foreign company as being

continued in Labuan

16. (1) Subject to section 7, a foreign company incorporated under

the laws of any country other than Malaysia, or of any jurisdiction
within such a country, may, if it is so authorized by the laws of that
country or jurisdiction, apply to the Authority to be registered as
being continued in Labuan as if it had been incorporated under this
Act.

(2) Upon application under subsection (1), supported by such

material as it considers adequate and satisfactory, the Authority may,
if it is satisfied that the consent of such number or proportion of the
shareholders, debenture-holders and creditors of the foreign company
as may be required by the laws of that country or jurisdiction, and the
consent of the proper officer of that country or jurisdiction, to such
registration has been obtained by the company, register such
company as being so continued and, if so registered, the company
 Labuan Companies 41

shall be deemed thereafter to be a Labuan company incorporated

under this Act and domiciled in Labuan:

Provided that no foreign company may be registered under this

section if—

(a) it is in the process of winding up or liquidation;

(b) a receiver of its property has been appointed; or

(c) there is any scheme or order in force in relation thereto

whereby the rights of creditors are suspended or restricted.

(3) The registration of a foreign company under this section shall

not operate —

(a) to create a new legal entity;

(b) to prejudice or affect the continuity of the company;

(c) to affect the property of the company;

(d) to render defective any legal or other proceedings instituted,

or to be instituted, by or against the company or any other
person; or

(e) to affect any rights, powers, authorities, duties, functions,

liabilities or obligations of the company or any other person.

(4) Upon the registration of a foreign company under this

section—

(a) so much of its constitution as would, if it had been

incorporated under this Act, have been required by this Act
to be included in its memorandum of association, shall be
deemed to be the memorandum of association of the
company; and
42 Laws of Malaysia ACT 441

(b) so much of its constitution as does not, by virtue of

paragraph (a), comprise its memorandum of association,
shall be deemed to be the articles of association of the
company,

and such deemed memorandum and articles shall be binding on the

company and its members accordingly.

Prior approval in principle

17. (1) A foreign company may, prior to applying for registration

under section 16, request that such registration be approved in
principle and upon such request and payment of the prescribed fee,
the Authority may, if it is satisfied that the company is eligible for
registration under section 16, issue a certificate confirming its
approval of the company being so registered subject to an application
under section 16 being made within a period of twelve months from
the date of the certificate.

(2) The certificate of approval given by the Authority under

subsection (1) shall not relieve the foreign company to whom it is
issued from complying with the provisions of section 16 on a
subsequent application for registration.

Requirements as to memorandum

18. (1) The memorandum of every Labuan company shall be

printed and divided into numbered paragraphs and dated and shall
state the following:

(a) the name of the company;

(b) the objects of the company;

(c) the amount and the denomination of the currencies of the

share capital with which it is proposed to be registered;
 Labuan Companies 43

(d) the full name and address of each subscriber thereto;

(e) that the subscriber or subscribers to the memorandum are

desirous of being formed into a Labuan company in
pursuance of the memorandum and respectively agree to
take the number of shares in the capital of the company set
out opposite their respective names; and

(f) if the Labuan company is a company limited by

guarantee—

(i) that the liability of the members is limited;

(ii) that each member undertakes to contribute to the

assets of the Labuan company; and

(iii) that each member undertakes to contribute to the

assets of the Labuan company, in such amount as may
be required not exceeding the amount specified in the
guarantee, in the event of the company being wound
up while he is a member or within one year after he
ceases to be a member for payment of the debts and
liabilities of the Labuan company contracted before
he ceases to be a member and of the costs, charges
and expenses of winding up and for adjustment of the
rights of the contributories among themselves.

(2) The members of the Labuan company shall be liable to the

company for the amount unpaid on their shares or the guarantee but
their liability as members is, subject to this Act, limited to the
amount, if any, unpaid on the shares or the guarantee held by them.

(3) Any provision or part thereof then subsisting in the

memorandum of any company which states—

(a) the amount of the share capital with which the company
proposes to be or is registered; or
44 Laws of Malaysia ACT 441

(b) the division of the share capital of the company into shares
of a fixed amount,

shall, in so far as it relates to the matters referred to in either or both

of paragraphs (a) and (b), be deemed to be deleted.

(4) The memorandum of a Labuan company may be registered in

any character, alphabet or language, provided that it is accompanied
by an accurate and certified translation of the English language
thereof.

DIVISION 2

STATUS AND NAME

Powers of companies

19. (1) Subject to this Act and any written law in Labuan on
financial services, a Labuan company shall have full capacity, rights,
powers and privileges to carry on or undertake any business or
activity, do any act, or enter into any transaction.

(2) The memorandum and articles of a Labuan company may

contain a provision relating to the limited capacity, rights, powers or
privileges of the company.

Ultra vires transactions

20. (1) No act or purported act of a Labuan company (including the

entering into of an agreement by the company and including any act
done on behalf of the company by an officer or agent of the company
under any purported authority, whether express or implied, of the
company) and no conveyance or transfer of property, whether real or
personal, to or by a Labuan company shall be invalid by reason only
of the fact that the company was without capacity or power to do the
act or to execute or take the conveyance or transfer.
 Labuan Companies 45

(2) Any such lack of capacity or power may be asserted or relied

upon only in—

(a) any proceedings against the Labuan company by any

member of the company or, where the company has issued
debentures secured by a floating charge over all or any of
the company’s property, by the holder of any of those
debentures, or by a Labuan trust company acting as trustee
for the holders of those debentures, to restrain the doing of
any act or the conveyance or transfer of any property to or
by the company;

(b) any proceedings by the company or by any member of the

company against the present or former officers of the
company; or

(c) any petition by the Minister to wind up the company.

(3) If the unauthorized act, conveyance or transfer sought to be

restrained in any proceedings under paragraph (2)(a) is being or is to
be performed or made pursuant to any contract to which the Labuan
company is a party, the Court may, if all the parties to the contract are
parties to the proceedings and if the Court deems it to be just and
equitable, set aside and restrain the performance of the contract and
may allow to the company or to the other parties to the contract, as
the case requires, compensation for the loss or damage sustained by
either of them which may result from the setting aside and restraining
of the performance of the contract, but anticipated profits to be
derived from the performance of the contract shall not be awarded by
the Court as a loss or damage sustained.

Names of Labuan companies

21. (1) Except with the consent of the Minister, a Labuan company
shall not be registered by a name that, in the opinion of the Authority,
is undesirable or is a name, or includes a name, of a kind that the
Authority is not otherwise willing to accept for registration.
46 Laws of Malaysia ACT 441

(2) A Labuan company shall have—

(a) the word “Corporation” or the word “Incorporated” or the

abbreviation “Corp.” or “Inc.”;

(b) the word “Limited” or the abbreviation “Ltd.”;

(c) the words “Public Limited Company” or the abbreviation

“P.L.C.”;

(d) the words “Societe Anonyme” or “Sociedad Anonima” or

the abbreviation “S.A.”;

(e) the words “Aktiengesellschaft” or the abbreviation “A.G.”;

(f) the words “Naamloze Vennootschap” or the abbreviation

“N.V.”;

(g) the words “Perseroan Terbatas” or the abbreviation “P.T.”;

or

(h) in romanized characters, any word or words in the national

language of any country which connote a joint stock
company limited by shares, or any abbreviation thereof,

as part of its name.

(2A) A Labuan company may have the word “(L)” as part of its
name.

(2B) Notwithstanding subsection (2), a Labuan company may have

as part of its name the word “Berhad” or the abbreviation “Bhd.” but
where the word “Berhad” or the abbreviation “Bhd.” is used as part
of the name of the Labuan company, the Labuan company shall in
addition have the word “(L)” as part of its name.

(2C) Subsection (2) shall not apply to a Labuan company that is

incorporated for non-profitable purposes including social, charitable
or educational.
 Labuan Companies 47

(2D) Where a Labuan company has a non-romanized character or

alphabet as part of its name, an accurate and certified rendition of the
name in the English language shall be employed and be clearly stated
in—

(a) every written communication sent by, or on behalf of, the

company; and

(b) every document issued or signed by, or on behalf of, the

company that evidences or creates a legal obligation of the
company.

(3) No description of a Labuan company shall be deemed

inadequate or incorrect by reason of the use of an abbreviation or
abbreviations in place of any word or words referred to in
subsection (2).

(4) A person may lodge with the Authority an application in the

prescribed form for the reservation of a name set out in the
application as—

(a) the name of an intended Labuan company; or

(b) the name to which Labuan company proposes to change its

name.

(5) If the Authority considers that the application is made

bona fide and is satisfied that the proposed name is a name by which
the intended Labuan company or the Labuan company could be
registered without contravention of subsection (1), the Authority shall
reserve the proposed name for a period of three months from the date
of the lodging of the application.

(6) During a period for which a name is reserved, no person (other

than the Labuan company or intended Labuan company in respect of
which the name is reserved) shall be registered under this Act or any
other Act, whether originally or on a change of name, under the
reserved name or under any other name that, in the opinion of the
48 Laws of Malaysia ACT 441

Authority, so closely resembles the reserved name as to be likely to

be mistaken for that name.

(7) The reservation of a name under this section in respect of an

intended Labuan company or a Labuan company shall not in itself
entitle the intended company or company to be registered by that
name, either originally or on change of name.

Change of name

22. (1) A Labuan company may, by special resolution, resolve that

its name should be changed to a name by which the company could
have been registered without contravention of subsection 21(1).

(2) If the Authority approves the name which the company has
resolved should be its new name, the Authority shall, on payment of
the prescribed fee, issue a certificate of incorporation of the company
under the new name and upon the issue of such certificate of
incorporation the change of name shall become effective.

(3) If the name of a Labuan company is (whether through

inadvertence or otherwise and whether originally or by a change of
name) a name by which the company could not be registered without
contravention of subsection 21(1), the company may, by special
resolution, change its name to a name by which the company could
be registered without contravention of that subsection and, if the
Authority so directs, shall so change it within six weeks after the date
of direction or such longer period as the Authority allows, unless the
Minister, by written notice, annuls the direction, and if the company
fails to comply with the direction it commits an offence under this
Act.

Penalty: *Fifty thousand ringgit.

(4) A change of name pursuant to this Act shall not affect the
identity of the Labuan company or any rights or obligations of the

*NOTE—Previously “Ten”—see section 11 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
 Labuan Companies 49

company or render defective any proceedings by or against the

company; and any legal proceedings that might have been continued
or commenced by or against the company by its former name may be
continued or commenced by or against the company by its new name.

Articles of association

23. (1) There shall be lodged with the memorandum of a Labuan

company articles of association signed by the subscribers to the
memorandum prescribing regulations for the company.

(2) Articles shall be —

(a) printed;

(b) divided into numbered paragraphs; and

(c) signed by each subscriber to the memorandum or, if any

subscriber is a company, sealed with its company seal or
signed on its behalf.

(3) Articles may be lodged in any foreign character, alphabet or

language, provided that it is accompanied by an accurate and certified
translation in the English language thereof, and in the event of
conflict, the meaning of words in the original foreign character,
alphabet or language shall prevail.

Alteration of memorandum or articles

24. (1) Subject to this Act, a Labuan company may, by special

resolution, alter or add to its memorandum or articles.

(2) Any alteration or addition so made in the memorandum or

articles shall take effect from the date the notice of the relevant
resolution is lodged with the Registrar and be as valid as if originally
contained therein and be subject in like manner to alteration by
special resolution.
50 Laws of Malaysia ACT 441

Copies of memorandum and articles

25. (1) A Labuan company shall, on being so required by any

member, furnish to him a copy of the memorandum and of the
articles (if any) on payment by the member of such amount as the
directors may determine to be reasonably necessary to defray the cost
of preparing and furnishing it.

(2) Where an alteration is made in the memorandum or articles of

a Labuan company, a copy of the memorandum or articles shall not
be issued by the company after the date of alteration unless —

(a) the copy is in accordance with the alteration; or

(b) a printed copy of the resolution making the alteration is

annexed to the copy of the memorandum or articles and the
particular clauses or articles affected are indicated in ink.

(3) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.

Penalty: Ten thousand ringgit *and default penalty of five hundred

ringgit.

Transactions and establishment of a branch

26. (1) Contracts on behalf of a Labuan company may be made as

follows:

(a) a contract which, if made between private persons, would

by law be required to be in writing under seal, may be made
on behalf of the company in writing under the common seal
of the company;

*NOTE—Previously “Ten thousand ringgit” only—see section 12 of the Labuan Companies

(Amendment) Act 2022 [Act A1653].
 Labuan Companies 51

(b) a contract which, if made between private persons, would

by law be required to be in writing signed by the parties to
be charged therewith, may be made on behalf of the
company in writing and signed by any person acting under
its authority, express or implied; or

(c) a contract which, if made between private persons, would

by law be valid although made by parol only, and not
reduced into writing, may be made by parol on behalf of the
company by any person acting under its authority, express
or implied,

and any contract so made shall be effectual in law and shall bind the
company and its successors and all other parties thereto and may be
varied or discharged in the manner in which it is authorized to be made.

(2) A document or proceeding requiring authentication by a

Labuan company may be signed by an authorized officer of the
company and need not be under its common seal.

(3) A Labuan company may, by writing under its common seal,

empower any person either generally or in respect of any specified
matters as its agent or attorney to execute deeds on its behalf and a
deed signed by such an agent or attorney on behalf of that company
under his seal or under the appropriate seal of the company, shall
bind the company; and all persons dealing in good faith shall be
entitled to presume the regular and proper execution of the deed, and
to act accordingly.

(4) A Labuan company may, if authorized by its articles, establish

a branch or an office in any part of the world, but it shall not establish
a branch or an office in any part of Malaysia outside Labuan except
as approved by the Authority.

(4A) If default is made in complying with this section, the Labuan

company or every officer of the company which is in default commits
an offence under this Act.

Penalty: One hundred thousand ringgit.

52 Laws of Malaysia ACT 441

(5) A Labuan company and any branch thereof may have for use
in any place outside Labuan a duplicate common seal which shall be
a facsimile of the common seal of the company with the addition on
its face of the name of that branch; that seal shall be known as the
branch seal.

(6) Where a Labuan company has established a branch it may, in

the instrument establishing the branch or in a subsequent instrument
signed or sealed by the resident secretary or under its own seal,
appoint one or more persons to be branch directors and to constitute a
local board and make provision for a branch seal and for its custody
and prescribe the person by whom such seal is to be affixed; and
subject to any directions or restrictions imposed from time to time by
the directors of the company, a branch shall have power to bind the
company and to issue shares or debentures of the company.

(7) A branch may enter into transactions in the same manner as the
Labuan company may enter into transactions.

(8) Instruments made or authenticated under or by use of any

branch seal of a Labuan company shall be as effective as if the
common seal of the company had been affixed thereto; and the date
on which and the place at which the branch seal is affixed to any
instrument shall be shown on the instrument.

Prohibition against carrying on business when Labuan company

has no members

27. (1) Subject to subsection (2), if at any time a Labuan company

has no members and carries on business for more than six months
while it has no members, every officer, servant, employee or agent of
that company during the time that it so carries on business after those
six months who knows that the company has no members shall be
liable, and if more than one, jointly and severally, for the payment of
all the debts of the company contracted during the time that it so
carries on business after those six months, and such officer, servant,
employee or agent commits an offence under this Act if the company
so carries on business after those six months.
 Labuan Companies 53

(2) Subsection (1) shall not apply in respect of an officer, servant,

employee or agent of a Labuan company which has no members who
carries on the business of the company after those six months, if the
officer, servant, employee or agent does so by virtue of a direction of
the Court or under the direction of an approved liquidator appointed
in respect of the company.

PART IV

SHARES, DEBENTURES AND CHARGES

DIVISION I

PROSPECTUSES

28. (Deleted by Act A1367).

29. (Deleted by Act A1367).

30. (Deleted by Act A1367).

31. (Deleted by Act A1367).

32. (Deleted by Act A1367).

33. (Deleted by Act A1367).

34. (Deleted by Act A1367).

35. (Deleted by Act A1367).

36. (Deleted by Act A1367).

37. (Deleted by Act A1367).

38. (Deleted by Act A1367).

39. (Deleted by Act A1367).

54 Laws of Malaysia ACT 441

DIVISION 2

RESTRICTIONS ON ALLOTMENT

40. (Deleted by Act A1367).

41. (Deleted by Act A1367).

42. (Deleted by Act A1367).

DIVISION 3

SHARES

Return of allotment

43. (1) Where a Labuan company makes any allotment of its

shares, the company shall, within one month thereafter, lodge with
the Authority a return of the allotment stating —

(a) the number of shares comprised in the allotment and the

amount paid for such shares;

(b) the date of the allotment;

(c) the amount (if any) deemed to be paid, or due and payable,
on the allotment of each share;

(d) where the capital of the company is divided into shares of

different classes, the class of shares to which each share in
the allotment belongs; and

(e) the full name and address of each of the allottees and the
number and class of shares allotted to him.

(1A) The Authority may request for additional information or

documents from a Labuan company in respect of its return of
allotment under this section.
 Labuan Companies 55

(2) If default is made in complying with this section, every officer

of the Labuan company who is in default commits an offence under
this Act.

Penalty: Ten thousand ringgit. Default penalty.

Calls

44. A Labuan company may—

(a) make arrangements, on the issue of shares, for varying the

amounts and times of payment of calls as between
shareholders;

(b) accept from any member the whole or any part of the
amount remaining unpaid on any shares although no part of
that amount has been called up; and

(c) pay dividends in proportion to the amount paid up on each

share where a larger amount is paid up on some shares than
on others.

Reserve liability

45. A Labuan company may, by special resolution, determine that

any portion of its uncalled share capital shall not be capable of being
called up except in the event of the company being wound up, but no
such resolution shall prejudice the rights acquired by any person
before the passing of the resolution.

No par or nominal value shares

46. (1) Shares of a Labuan company shall have no par or nominal

value.
56 Laws of Malaysia ACT 441

(2) In relation to a share issued by a Labuan company before the

effective date—

(a) the amount paid on the share shall be the sum of all amounts
paid to the Labuan company at any time for the share (but
not including any premium); and

(b) the amount unpaid on the share shall be the difference

between the price of issue of the share (but not including
any premium) and the amount paid on the share.

(3) Any amount standing to the credit of a Labuan company’s

share premium account and any amount standing to the credit of a
Labuan company’s capital redemption reserve before the effective
date shall become part of the company’s share capital.

(4) Notwithstanding subsection (3), a Labuan company may use

the amount standing to the credit of its share premium account to—

(a) provide for the premium payable on redemption of

debentures or redeemable preference shares issued before
the effective date;

(b) write off —

(i) the preliminary expenses of the Labuan company

incurred before the effective date; or

(ii) any expenses incurred, or commissions or brokerages

paid, or discounts allowed, on or before the effective
date, for or on any duty, fee or tax payable on or in
connection with any issue of shares of the company;

(c) pay up, pursuant to an agreement made before the effective

date, shares which were unissued before that date and which
are to be issued on or after that date to the members of the
Labuan company as fully paid bonus shares;
 Labuan Companies 57

(d) pay up in whole or in part the balance unpaid on shares

issued before that date to the members of the Labuan
company; or

(e) pay dividends declared before the effective date, if such

dividends are satisfied by the issue of shares to members of
the Labuan company.

(5) Notwithstanding subsection (3), if the Labuan company carries

on an insurance business or a takaful business in Labuan, it may also
apply the amount standing to the credit of its share premium account
immediately before the effective date by appropriation or transfer to
any fund established and maintained pursuant to the Labuan Financial
Services and Securities Act 2010 or the Labuan Islamic Financial
Services and Securities Act 2010, as the case may be.

(6) Notwithstanding subsection (2), the liability of a shareholder

for calls in respect of money unpaid on shares issued before the
effective date (whether on account of the par value of the shares or by
way of premium) shall not be affected by the shares ceasing to have a
par value.

(7) A Labuan company may at any time before —

(a) the date it is required under section 109 to lodge its first
annual return after the effective date; or

(b) the expiry of six months from the effective date,

whichever is the earlier, or within such longer period as may be

allowed by the Authority, lodge with the Authority a notice of its
share capital in the prescribed form.

(8) Unless a Labuan company has lodged a notice of its share

capital under subsection (7), the Authority may, for the purposes of
the records maintained by the Authority, adopt, as the share capital of
the Labuan company, the aggregate nominal value of the shares
issued by the Labuan company as that value appears in the
Authority’s records immediately before the effective date.
58 Laws of Malaysia ACT 441

(9) For the purposes of this section—

(a) “effective date” means the date of commencement of the

Offshore Companies (Amendment) Act 2010 [Act A1367];

(b) in relation to a contract (including the memorandum and

articles of the company) entered into, or a trust deed or
other document executed before the effective date—

(i) a reference to the par or nominal value of a share,

shall be a reference to—

(A) if the share is issued before the effective date, the

par or nominal value of the share immediately
before the effective date;

(B) if the share is issued on or after the effective date

but shares of the same class were on issue
immediately before the effective date, the par or
nominal value that the share would have had if it
had been issued then; or

(C) if the share is issued on or after the effective date

and shares of the same class were not on issue
immediately before the effective date, the par or
nominal value determined by the directors;

(ii) a reference to any share premium shall be taken to be

a reference to any residual share capital in relation to
the share;

(iii) a reference to a right to a return of capital on a share

shall be taken to be a reference to a right to a return of
capital of a value equal to the amount paid in respect
of the share’s par or nominal value; and

(iv) a reference to the aggregate par or nominal value of

the Labuan company’s issued share capital shall be
 Labuan Companies 59

taken to be a reference to that aggregate as it existed

immediately before the effective date as—

(A) increased to take account of the par or nominal

value as referred to in subparagraph (i) of any
shares issued on or after the effective date; and

(B) reduced to take account of the par or nominal

value as referred to in subparagraph (i) of any
shares cancelled on or after the effective date.

Prohibition to issue bearer share or bearer share warrants

46A. (1) A Labuan company shall not—

(a) issue a bearer share or bearer share warrants;

(b) convert a share into a bearer share or bearer share warrants

into share warrants; or

(c) exchange a share for a bearer share.

(2) Any purported issuance, conversion or exchange of such

bearer share, bearer share warrants, share or share warrants under
subsection (1) is void.

(3) A provision in a Labuan company’s memorandum or articles

which purports to enable the company to issue, convert or exchange
any of the bearer share, bearer share warrants, share or share warrants
is void.

(4) This section shall apply to a foreign Labuan company.

(5) If default is made in complying with this section, the Labuan

company, foreign Labuan company and every officer of the company
who is in default commits an offence under this Act.
60 Laws of Malaysia ACT 441

Power to issue shares and voting rights

47. (1) A Labuan company shall have power—

(a) to issue shares which may be divided into one or more

classes, with such designations, preferences, limitations and
relative rights as shall be stated or provided for in the articles,
and all prices and values given in respect of the shares shall
be expressed in a currency other than ringgit; and

(b) subject to its articles, to issue fractions of its shares, and

such fractional shares shall have the corresponding
fractional liabilities, limitations, preferences, privileges,
qualifications, restrictions, rights and other attributes of a
whole share of the same class or series of shares.

(2) The articles may limit or deny voting rights of, or provide
special voting rights for, the shares of any class or the shares within
any class to any extent not inconsistent with the provisions of this Act
or the regulations.

Treasury shares

47A. (1) A Labuan company may hold its own shares that are
purchased or otherwise acquired pursuant to section 48A as treasury
shares where—

(a) the articles of the Labuan company so permits; and

(b) the number of shares purchased or acquired, when

aggregated with shares of the same class held by the Labuan
company at the time of the purchase or acquisition, does not
exceed fifteen percent of the shares of that class previously
issued by the Labuan company.

(2) The Labuan company whilst holding its own shares as treasury
shares—
 Labuan Companies 61

(a) shall not exercise any right in respect of the treasury shares
and any purported exercise of such a right is void and the
treasury shares shall be treated as having no voting rights;

(b) may not make or receive any dividend or distribution of the

Labuan company’s asset, including any distribution of
assets to members on a winding up, in respect of the shares;

(c) may at any time sell the treasury shares for cash or transfer
the shares as consideration for the purchase or acquisition of
shares in or assets of another company or assets of a person;

(d) may at any time cancel the treasury shares and the directors
may take such steps as are requisite to enable the company
to cancel its shares without complying with section 53; and

(e) may distribute the treasury shares as dividends to the

shareholders (such dividends to be known as “share
dividends”), provided that the costs of the shares on the
original purchases shall be applied in the reduction of the
funds otherwise available for distribution as dividends.

Dealing by a Labuan company in its own shares, etc.

48. (1) A Labuan company may provide financial assistance,

whether directly or indirectly, for the purpose of or in connection
with the purchase of its own shares or the shares of any of its
subsidiaries or of its holding company—

(a) in the ordinary course of its business, if the lending of

money is part of the ordinary business of the Labuan
company;

(b) where the transaction has been approved by a special

resolution of the company, and the directors have certified
to the meeting, in writing, to the effect that there are no
reasonable grounds for believing that —
62 Laws of Malaysia ACT 441

(i) the company is, or would after giving the financial

assistance be, insolvent; or

(ii) the realizable value of the company’s assets,

excluding the amount of any financial assistance in
the form of a loan and in the form of assets pledged or
encumbered to secure a guarantee, would, after giving
the financial assistance or loan, be less than the
aggregate of the company’s liabilities and stated
capital; or

(c) to employees (other than an employee who is also a

director) of the company or of any of its subsidiaries or of
its holding company.

(2) (Deleted by Act A1367).

(3) (Deleted by Act A1367).

Purchase by a Labuan company of its own shares, etc.

48A. (1) Subject to subsections (2) and (3), a Labuan company may
purchase its own shares—

(a) where its memorandum or articles so provide; and

(b) by special resolution,

provided that the purchases thereof, whether direct or indirect, shall

be made to the extent of any solvent surplus available.

(2) A payment made by the Labuan company in consideration of

the purchase of its own shares in accordance with subsection (1) may
be made out of the Labuan company’s capital or profits so long as the
directors declare by way of a solvency declaration that—

(a) the Labuan company is able to pay its debts in full at the
time of such payment and will be able to pay its debts as
 Labuan Companies 63

they fall due in the normal course of business during the

period of twelve months immediately following the date of
the payment; and

(b) the value of the Labuan company’s assets is not less than
the value of its liabilities (including contingent liabilities)
and will not after the proposed purchase become less than
the value of its liabilities (including contingent liabilities).

(3) A Labuan company may not purchase any of its own shares
unless—

(a) they are fully paid; and

(b) a minimum of one shareholder, other than the Labuan

company itself, would remain after the purchase.

(4) Subject to section 47A, a Labuan company may at any time, by

resolution of its directors, cancel any or part of the shares of the
Labuan company of any class purchased by it, and in such event a
statement of cancellation shall be lodged with the Authority within
thirty days from the date of cancellation.

(5) Where the directors resolve to cancel the shares so purchased,

the issued share capital of the company shall be diminished by the
shares so cancelled.

(6) The purchase of shares pursuant to subsection (1) and the

cancellation of shares made pursuant to subsection (4) shall not be
deemed to be a reduction of share capital of the Labuan company.

49. (Deleted by Act A1367).

50. (Deleted by Act A1367).

64 Laws of Malaysia ACT 441

Alteration of share capital

51. (1) A Labuan company may, by ordinary resolution, alter the

conditions of its memorandum and articles in any one or more of the
following ways:

(a) (Deleted by Act A1367);

(b) consolidating and dividing all or any of its share capital;

(c) subdividing its shares or any of them, so however that in the

subdivision the proportion between the amount paid and the
amount (if any) unpaid on each reduced share shall be the
same as it was in the case of the share from which the
reduced share is derived;

(d) converting all or any of its paid-up shares into stock and
reconverting that stock into paid-up shares;

(e) cancelling shares which, at the date of the passing of the

resolution in that behalf, have not been taken or agreed to be
taken by any persons, and diminishing the amount of the
share capital by the amount of the shares so cancelled;

(f) redenominating the currency of any shares by the

conversion of shares denominated in one currency to the
same number of shares of another currency with the prior
written consent of the creditor, if any.

(1A) A redenomination of the currency of any shares under

paragraph (1)(f) shall be deemed not to effect a cancellation of the
existing shares and the issue of fresh shares.

(2) A cancellation of shares under paragraph (1)(e) shall not be

deemed to be a reduction of share capital within the meaning of this
Act.

(3) (Deleted by Act A1367).

 Labuan Companies 65

(4) (Deleted by Act A1367).

Validation of shares improperly issued

52. Where a Labuan company has purported to issue or allot shares,

and the issue or allotment of those shares was invalid by reason of
any provision of this Act or of the memorandum or articles of the
company or otherwise, or the terms of issue or allotment were
inconsistent with or unauthorized by any such provision, the Court
may, upon application lodged with it by the company or by a holder
or mortgagee of any of those shares or by a creditor of the company,
and upon being satisfied that in all the circumstances it is just and
equitable so to do, make an order validating the issue or allotment of
those shares, or confirming the terms of issue or allotment thereof, or
both, subject to such conditions, if any, as it may impose, and upon
such order being made and a copy thereof being lodged by the
company or by such holder, mortgagee or creditor with the Authority,
those shares shall be deemed to have been validly issued or allotted
upon the terms of issue or allotment thereof as varied by the
conditions, if any, imposed by the Court.

Special resolution for reduction of share capital

53. (1) Subject to confirmation by the Court, a Labuan company

may, if so authorized by its articles, by special resolution reduce its
share capital in any way and in particular, without limiting the
generality of the foregoing, may—

(a) extinguish or reduce the liability on any of its shares in

respect of share capital not paid up;

(b) cancel any paid-up capital which is lost or unrepresented by

available assets; or

(c) pay off any paid-up share capital which is in excess of the
needs of the company, or which it is otherwise in the
interests of the company as a whole to have paid off,
66 Laws of Malaysia ACT 441

and may, so far as necessary, alter its memorandum by reducing the

amount of its share capital and of its shares accordingly.

(2) Where the proposed reduction of share capital involves

diminution of liability in respect of unpaid share capital or the
payment to any shareholder of any paid-up share capital, and in any
other case if the Court so directs—

(a) every creditor of the Labuan company who, at the time

fixed by the Court, is entitled to any debt or claim which, if
that date were the commencement of the winding up of the
company, would be admissible in proof against the
company, shall be entitled to object to the reduction;

(b) the Court, unless satisfied by statutory declaration by the

directors that there are no such creditors, shall settle a list of
creditors so entitled to object, and for that purpose shall
ascertain, as far as possible without requiring an application
from any creditor, the names of those creditors and the
nature and amount of their debts or claims, and may publish
notices fixing a final day on or before which creditors not
entered on the list may claim to be so entered; and

(c) where a creditor entered on the list whose debt or claim is

not discharged or has not been determined does not consent
to the reduction, the Court may dispense with the consent of
that creditor on the Labuan company securing payment of
his debt or claim by appropriating, as the Court directs—

(i) if the company admits the full amount of the debt or

claim or, although not admitting it, is willing to
provide for it, the full amount of the debt or claim; or

(ii) if the company does not admit, and is not willing to

provide for, the full amount of the debt or claim, or if
the amount is contingent or not ascertained, an
amount fixed by the Court after the like inquiry and
adjudication as if the company were being wound up
by the Court.
 Labuan Companies 67

(3) Notwithstanding the provisions of subsection (2) the Court

may, having regard to the circumstances of the case, direct that all or
any of the provisions of that subsection shall not apply as regards any
class of creditors.

(4) The Court, if satisfied with respect to every creditor who under
subsection (2) is entitled to object, that either his consent to the
reduction has been obtained, or his debt or claim has been discharged
or has been determined or has been secured, may make an order
confirming the reduction on such terms and conditions as it thinks fit,
and may require the Labuan company to publish as the Court directs
the reasons for reduction or such other information as the Court
thinks expedient, and, if the Court thinks fit, the causes which led to
the reduction.

(5) An order made under subsection (4) shall show the amount of
the share capital of the Labuan company as altered by the order, the
number of shares into which it is to be divided and the amount of
each share and the amount, if any, at the date of the order, deemed to
be paid up on each share.

(6) On the lodging of an office copy of the order with the

Authority, the resolution for reducing share capital as confirmed by
the order shall take effect, and the Authority shall issue a certificate
of such lodgment.

(7) The certificate of the Authority shall be conclusive evidence

that all the requirements of this Act with respect to reduction of share
capital have been complied with and that the share capital of a
Labuan company is as stated in the order.

(8) On the lodging of the copy of the order, the particulars shown
in the order pursuant to subsection (5) shall be deemed to be
substituted for the corresponding particulars in the memorandum, and
such substitution and any addition ordered by the Court to be made in
the name of the Labuan company shall (in the case of any addition to
the name, for such period as is specified in the order of the Court) be
deemed to be an alteration of the memorandum for the purposes of
this Act.
68 Laws of Malaysia ACT 441

(9) A member, past or present, shall not be liable in respect of any

share to any call or contribution exceeding in amount the difference
between the amount of the share as fixed by the order and the amount
paid, or the reduced amount which is to be deemed to have been paid
on the share, as the case may be, but where any creditor entitled to
object to the reduction is, by reason of his ignorance of the
proceedings for reduction, or of their nature and effect upon his
claim, not entered on the list of creditors, and after the reduction the
Labuan company is unable, within the meaning of the provisions of
this Act with respect to winding up by the Court, to pay the amount
of his debt or claim —

(a) every person who was a member of that Labuan company at

the date of the lodging of the copy of the order of the Court
for reduction shall be liable to contribute for the payment of
that debt or claim to an amount not exceeding that which he
would have been liable to contribute if the company had
commenced to be wound up on the day before that date; and

(b) if that Labuan company is wound up, the Court, on the

application of any such creditor and proof of his ignorance
of the proceedings for reduction or of their nature and effect
upon his claim, may settle a list of persons so liable to
contribute, and make and enforce calls and orders on the
contributories settled on the list, as if they were ordinary
contributories in a winding up,

but nothing in this subsection shall affect the rights of the

contributories among themselves.

(9A) Notwithstanding subsection (1), an alteration of the

memorandum by reducing the amount of its share capital and of its
shares pursuant to a special resolution passed in accordance with
subsection (1), may be made without confirmation by the Court, so
long as the directors declare by way of a solvency declaration—

(a) that in their opinion, as regards the Labuan company’s

situation at the date of the solvency declaration, there is no
 Labuan Companies 69

ground on which the Labuan company could then be found

to be unable to pay its debts;

(b) that in their opinion—

(i) if there is an intention to commence winding up of the

Labuan company within the period of twelve months
immediately following the date of the solvency
declaration, that the Labuan company will be able to
pay its debts in full within the period of twelve
months beginning with the commencement of the
winding up; or

(ii) if there is no intention to commence winding up, that

the Labuan company will be able to pay its debts as
they fall due during the period of twelve months
immediately following the date of the solvency
declaration; and

(c) that they have formed the opinion that the value of the
Labuan company’s assets is not less than the value of its
liabilities (including contingent liabilities) and will not, after
the proposed reduction, become less than the value of its
liabilities (including contingent liabilities),

and every creditor of the Labuan company entitled to any debt or

claim admissible in proof against the Labuan company at the date of
the solvency declaration shall be entitled to object to the reduction.

(9B) The directors shall lodge a certified copy of the solvency

declaration within thirty days with the Authority, and on such
lodgment the Authority shall issue a certificate confirming the
lodgment of the solvency declaration.

(9BA) If default is made in complying with subsection (9B), the

director of the Labuan company who is in default commits an offence
under this Act.
70 Laws of Malaysia ACT 441

Penalty: Fifty thousand ringgit or imprisonment for a term not

exceeding three years or both.

(9C) The Labuan company shall, for a period of six weeks

beginning with the resolution date, make available the solvency
declaration or a copy of it at the Labuan company’s registered office
for inspection free of charge by any creditor of the company.

(9D) A creditor of the Labuan company may, at any time during

the period of six weeks referred to in subsection (9C), apply to the
Court for the resolution to be cancelled.

(9E) Subsections (9C) and (9D) shall apply to a creditor of the

Labuan company who, at the date of his application to the Court, is
entitled to any debt or claim which, if that date was the
commencement date of the winding up of the Labuan company,
would be admissible in proof against the Labuan company.

(9F) Where an application is made by a creditor to the Court under

subsection (9D)—

(a) the creditor shall as soon as possible serve the application

on the Labuan company; and

(b) the Labuan company shall as soon as possible give a notice

of the application to the Authority.

(10) Any officer of a Labuan company who—

(a) wilfully conceals the name of any creditor entitled to object

to the reduction;

(b) wilfully misrepresents the nature or the amount of the debt

or claim of any creditor; or

(c) aids, abets or is party to any such concealment or

misrepresentation,

commits an offence under this Act.

 Labuan Companies 71

Penalty: *Three million ringgit or imprisonment for a term not

exceeding five years or both.

Rights of holders of preference shares to be set out in articles

54. (1) No Labuan company shall allot a preference share, or

convert an issued share into a preference share, unless there is set out
in its articles the rights of the holder of such a share with respect to
the repayment of capital, participation in surplus assets and profits,
cumulative or non-cumulative dividends, voting and priority of
payment of capital and dividend in relation to other shares or other
classes of preference shares.

(2) The issue by a Labuan company of preference shares ranking

pari passu with existing preference shares issued by the company
shall be deemed to be a variation of the rights attached to those
existing preference shares unless the issue of the first mentioned
shares was authorized by the terms of issue of existing preference
shares or by the articles in force at the time the existing preference
shares were issued.

(3) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.

Penalty: Five hundred thousand ringgit.

Redeemable preference shares

55. (1) Subject to this section, a Labuan company having a share

capital may, if so authorized by its articles, issue preference shares
which are, or at the option of the company are to be, liable to be
redeemed, and the redemption shall be effected only on such terms
and in such manner as are provided by the articles.

*NOTE—Previously “Imprisonment for three years or ten thousand ringgit or both”—see

subsection 15(b) of the Labuan Companies (Amendment) Act 2022 [Act A1653].
72 Laws of Malaysia ACT 441

(2) The redemption shall not be taken as reducing the amount of

share capital of the company.

(3) The shares shall not be redeemed unless they are fully paid up.

(3A) The shares may be redeemed out of the profits or, subject to
subsection (3B), out of the capital of the Labuan company.

(3B) The shares shall not be redeemed out of the capital of the
Labuan company unless the directors declare by way of a solvency
declaration—

(a) that in their opinion, as regards the Labuan company’s

situation at the date of the solvency declaration, there is no
ground on which the Labuan company could then be found
to be unable to pay its debts;

(b) that in their opinion—

(i) if there is an intention to commence winding up of the

Labuan company within the period of twelve months
immediately following the date of the solvency
declaration, that the Labuan company will be able to
pay its debts in full within the period of twelve
months beginning with the commencement of the
winding up; or

(ii) if there is no intention to commence winding up, that

the Labuan company will be able to pay its debts as
they fall due during the period of twelve months
immediately following the date of the solvency
declaration; and

(c) that they have formed the opinion that the value of the
Labuan company’s assets is not less than the value of its
liabilities (including contingent liabilities) and will not, after
the proposed redemption, become less than the value of its
liabilities (including contingent liabilities).
 Labuan Companies 73

(3C) The directors shall lodge a certified copy of the solvency

declaration and notice of such redemption of share in the prescribed
form within thirty days with the Authority, and on such lodgment the
Authority shall issue a certificate confirming the lodgment of the
solvency declaration.

(4) If default is made in complying with subsection (3C), the

director of the Labuan company who is in default commits an offence
under this Act.

Penalty: Fifty thousand ringgit or imprisonment for a term not

exceeding three years or both.

(4) (Deleted by Act A1367).

(5) (Deleted by Act A1367).

(6) (Deleted by Act A1367).

(7) (Deleted by Act A1367).

(8) (Deleted by Act A1367).

DIVISION 4

DEBENTURES

Interpretation

56. (Deleted by Act A1367).

57. (Deleted by Act A1367).

74 Laws of Malaysia ACT 441

Labuan company to maintain register of debenture holders

58. (1) Subject to the provisions of this section, every Labuan

company which issues debentures shall keep and maintain at its
registered office in Labuan—

(a) a register of holders of the debentures;

(b) a copy of all the terms of debentures so issued;

(c) a statement of account of the status of the debentures; and

(d) a register of all cancelled or redeemed debentures.

(1A) If default is made in complying with subsection (1), the

Labuan company which is in default commits an offence under this
Act.

Penalty: Twenty thousand ringgit. Default penalty.

(2) Every register of holders of debentures of a Labuan company

shall, except when duly closed, be open to the inspection of the
registered holder of any such debenture and any holder of shares in
that company, and shall contain, in the case of ordinary debentures,
particulars of the names and addresses of the debenture holders and
of the number of debentures held by each of them.

(3) For the purposes of this section, a register of holders of

debentures shall be deemed to be duly closed if closed in accordance
with the provisions contained in the articles, or in the debentures or
debenture stock certificates, or in the trust deeds or other documents
relating to or securing the debentures, during such period or periods,
not exceeding in the aggregate thirty days in any calendar year, as are
therein specified.

(4) Any registered holder of debentures issued by, and any holder
of shares in, a Labuan company shall, at his request, be supplied by
the company with a copy of the register of the holders of debentures
of the company or any part thereof, on payment of such amount, not
 Labuan Companies 75

exceeding twenty ringgit or the equivalent in any currency, as the

company may require, but the copy need not include any particulars
as to any debenture holder other than his name and address and the
debentures held by him.

(5) A copy of any trust deed relating to or for securing any issue of
debentures by a Labuan company shall be forwarded by the company
to a holder of those debentures at his request, on payment of such
amount, not exceeding twenty ringgit or the equivalent in any
currency, as the company may require.

(6) If inspection is refused, or a copy is refused or not forwarded,

within a reasonable time (but not more than one month) after a
request has been made pursuant to this section, the Labuan company
and every officer of the company who is in default commits an
offence under this Act.

Penalty: *Twenty thousand ringgit. Default penalty.

(7) (Deleted by Act A1367).

Perpetual debentures

59. A condition contained in a debenture, or in a deed for securing a

debenture, shall not be invalid by reason only that the debenture is
thereby made irredeemable or redeemable only on the happening of a
contingency, however remote, or on the expiration of a period,
however long, any rule of law or equity to the contrary
notwithstanding.

Reissue of redeemed debentures

60. (1) Where a Labuan company has redeemed any debentures—

*NOTE—Previously “Ten”—see subsection 18(b) of the Labuan Companies (Amendment) Act 2022
[Act A1653].
76 Laws of Malaysia ACT 441

(a) unless any provision to the contrary, whether express or,

implied, is contained in any contract entered into by the
company; or

(b) unless the company has, by passing a resolution to that

effect or by some other act, manifested its intention that the
debentures shall be cancelled,

that company shall have power to reissue the debentures, either by

reissuing the same debentures or by issuing other debentures in their
place, but the reissue of a debenture or the issue of one debenture in
place of another under this subsection shall not be regarded as the
issue of a new debenture for the purpose of any provision limiting the
amount or number of debentures that may be issued by the company.

(2) On the reissue of redeemed debentures, the person entitled to

the debenture shall have, and shall be deemed always to have had, the
same priorities as if the debentures had never been redeemed.

(3) Where a Labuan company has deposited any of its debentures

to secure advances on current accounts or otherwise, the debentures
shall not be deemed to have been redeemed by reason only of the
company’s account having ceased to be in debit while the debentures
remain so deposited.

61. (Deleted by Act A1367).

62. (Deleted by Act A1367).

63. (Deleted by Act A1367).

64. (Deleted by Act A1367).

65. (Deleted by Act A1367).

 Labuan Companies 77

DIVISION 5

INTERESTS OTHER THAN SHARES, DEBENTURES, ETC.

Interpretation

66. In this Division, unless the context otherwise requires —

“interest” means any right to participate, or any interest, whether

enforceable or not, and whether actual, prospective or contingent —

(a) in any profits, assets or realization of any financial or

business undertaking or scheme whether in Malaysia or
elsewhere;

(b) in any common enterprise, whether in Malaysia or

elsewhere, in which the holder of the right or interest is led
to expect profits, rent or interest from the efforts of the
promoter of the enterprise or a third party; or

(c) in any investment contract,

whether or not the right or interest is evidenced by a formal

document, and whether or not the right or interest relates to a physical
asset, but does not include—

(d) any share in or debenture of a corporation;

(da) any interest in a limited partnership or a limited liability

partnership;
(e) any interest in, or arising out of, a policy of life insurance;

(f) any interest in a partnership agreement other than in

paragraph (da) unless the agreement—

(i) relates to an undertaking, scheme, enterprise or

investment contract promoted by, or on behalf of, a
person whose ordinary business is or includes the
78 Laws of Malaysia ACT 441

promotion of similar undertakings, schemes,

enterprises or investment contracts; or

(ii) is an agreement, or is within a class of agreements,

prescribed by regulations for the purposes of this
paragraph;

“investment contract” means any contract, scheme or arrangement

which in substance and irrespective of the form thereof involves the
investment of money in or under such circumstances that the investor
acquires or may acquire an interest in or right in respect of property
which, under or in accordance with the terms of investment, will or
may, at the option of the investor, be used or employed in common
with any other interest in or right in respect of property acquired in or
under like circumstances;

“management company”, in relation to any interests issued or any

deed that relates to any interests issued or proposed to be issued,
means a company by or on behalf of which the interests have been or
are proposed to be issued, and includes any person for the time being
exercising the functions of the management company.

Approved deeds

67. For the purposes of this Division, a deed shall be an approved

deed if—

(a) the Authority has granted its approval to the deed under this
Division; and

(b) the Authority has granted its approval under this Division to
the Labuan trust company appointed for the purposes of the
deed acting as a trustee or representative, and that approval
has not been revoked and the trustee or representative has
not ceased to hold office.
 Labuan Companies 79

Approval of deeds

68. (1) Where a deed makes a provision for the appointment of a

trustee for, or a representative of, the holders of the interests issued
or proposed to be issued by a Labuan company or a foreign Labuan
company, the Authority may, subject to this section, grant its
approval to the deed.

(2) The Authority shall not grant its approval to a deed unless the
deed—

(a) stipulates that no part of the interests to which the deed

relates shall be offered to residents of Malaysia;

(b) complies with the requirements of this Division; and

(c) makes provision for such other matters and things as are
required by or under the regulations to be included in the
deed, and if regulations have been made prescribing the
charges that may be made by a management company,
unless the deed provides—

(i) that the charges to be made by the management

company do not exceed such percentages or amounts
as are prescribed; and

(ii) that the price at which the interests to which the deed
relates are to be sold or purchased by the management
company are consistent with the regulations relating
to those prices.

Interests to be issued by a Labuan company or a foreign Labuan

company only

69. (1) No person, except a Labuan company or a foreign Labuan

company or an agent of such company authorized in that behalf under
the seal of the company, shall issue or offer to the public for
80 Laws of Malaysia ACT 441

subscription or purchase, or shall invite the public to subscribe for or

purchase, any interest.

(2) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: Three million ringgit or imprisonment for a term not

exceeding five years or both.

Statement to be issued

70. (1) Before a Labuan company or a foreign Labuan company or

an agent of such company issues or offers to the public for
subscription or purchase, or invites the public to subscribe for or
purchase, any interest, the company shall issue, or cause to be issued,
a statement in writing in connection therewith, which statement shall
for all purposes be deemed to be a prospectus issued by a company,
and all provisions of this Act and rules of law relating to prospectuses
or to the offering or to an intended offering of shares for subscription
or purchase to the public shall, with such adaptations as are
necessary, apply and have effect accordingly as if the interest were
shares offered or intended to be offered to the public for subscription
or purchase, and as if persons accepting any offer or invitation in
respect of or subscribing for or purchasing any such interest were
subscribers for shares.

(2) If default is made in complying with this section, the Labuan

company, foreign Labuan company or agent of the company who is
in default commits an offence under this Act.

Penalty: Three million ringgit or imprisonment for a term not

exceeding five years or both.

No issue without approved deed

71. (1) No person shall issue or offer to the public for subscription
or purchase, or invite the public to subscribe for or purchase, any
 Labuan Companies 81

interest unless, at the time of the issue, offer or invitation, there is in

force, in relation to the interest, a deed that is an approved deed.

(2) A person shall not, in any deed, prospectus, statement,

advertisement or other document relating to any interest, make any
reference to an approval of a deed or of a trustee or representative
granted under this Division.

(3) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: One million ringgit or imprisonment for a term not

exceeding three years or both.

Register of interest holders

72. (1) The management company shall, in respect of each deed

with which the company is concerned, keep a register of the holders
of interests under the deed and enter therein —

(a) the names and addresses of the holders;

(b) the extent of the holding of each holder and, if his interest
consists of a specific interest in any property, a description
of the property and its location sufficient to identify it;

(c) the date at which the name of each person was entered in
the register as a holder; and

(d) the date at which any person ceased to be a holder.

(2) Division 4 of Part V shall, so far as is applicable and with such

adaptations as are necessary, apply to and in relation to the register.

(3) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.
82 Laws of Malaysia ACT 441

Penalty: Fifty thousand ringgit or imprisonment for a term not

exceeding three years or both.

Penalty for contravention of Division, etc.

73. (1) A person shall not —

(a) contravene or fail to comply with this Division; or

(b) fail to comply with a convenant contained, or deemed to be

contained, in any deed that is or at any time has been an
approved deed.

Penalty: Imprisonment for three years or ten thousand ringgit or

both.

(2) No person shall be relieved from any liability to any holder of

an interest by reason of any contravention of, or failure to comply
with, this Division.

(3) Subsection (1) shall not apply to sections 69, 70, 71 and 72.

Winding up of schemes, etc.

74. (1) Where the management company under a deed is in

liquidation or where, in the opinion of the trustee or representative,
the management company has ceased to carry on business or has, to
the prejudice of holders of interests to which the deed relates, failed
to comply with the deed, the trustee or representative shall summon a
meeting of the holders.

(2) A meeting under subsection (1) shall be summoned—

(a) by sending by post notice of the proposed meeting, at least

twenty-one days before the proposed meeting, to each
holder at his last known address, or, in the case of joint
 Labuan Companies 83

holders, to the joint holder whose name stands first in the

company’s records; and

(b) by publishing, at least twenty-one days before the proposed

meeting, an advertisement giving notice of the meeting in a
newspaper circulating in Labuan.

(3) If at any such meeting a resolution is passed by a majority in

number representing three-fourths in value of the holders of the
interests present and voting, either in person or by proxy, at the
meeting that the undertaking, scheme, enterprise, contract or
arrangement to which the deed relates be wound up, the trustee or
representative shall apply to the Court for an order confirming the
resolution.

(4) On an application by the trustee or representative the Court

may, if it is satisfied that it is in the interest of the holders of the
interests, confirm the resolution and may make such orders as it
thinks necessary or expedient for the effective winding up of the
undertaking, scheme, enterprise, contract or arrangement.

Liability of trustees

75. (1) Subject to this section, any provision contained in a deed, or

in any contract with the holders of interests to which such a deed
relates, shall be void so far as it would have the effect of exempting a
trustee or representative under the deed from, or indemnifying a
trustee or representative against, liability for breach of trust where the
trustee or representative fails to show the degree of care and diligence
required of a trustee or representative.

(2) Subsection (1) shall not invalidate—

(a) any release otherwise validly given in respect of anything

done, or omitted to be done, by a trustee or representative
before the giving of the release; or

(b) any provision enabling such a release to be given—

84 Laws of Malaysia ACT 441

(i) on the agreement thereto of a majority of not less than

three-fourths of the holders of interests as vote in
person or by proxy at a meeting summoned for the
purpose; and

(ii) either with respect to specific acts or omission, or on

the trustee or representative ceasing to act.

DIVISION 6

TITLE AND TRANSFERS

Nature of shares

76. The share or other interest of any member in a Labuan company

shall be movable property, transferable in the manner provided by the
articles, and shall not be of the nature of immovable property.

Numbering of shares

77. (1) Each share in a Labuan company shall be distinguished by

its appropriate number.

(2) Notwithstanding subsection (1)—

(a) if at any time all the issued shares in a Labuan company, or

all the issued shares therein of a particular class, are fully
paid up and rank pari passu for all purposes, none of those
shares need thereafter have a distinguishing number so long
as it remains fully paid up and ranks pari passu for all
purposes with all shares of the same class for the time being
issued and fully paid up; or

(b) if all the issued shares in a Labuan company are evidenced

by certificates in accordance with section 78 and each
certificate is distinguished by its appropriate number and
 Labuan Companies 85

that number is recorded in the register of members, none of

those shares need have a distinguishing number.

Certificate to be evidence of title

78. (1) A certificate, under the seal of a Labuan company or any

branch thereof, specifying any shares held by a member shall be
prima facie evidence of his title to the shares.

(2) Every share certificate shall be under the seal of the Labuan
company or a branch thereof and shall state—

(a) the name of the company and the authority under which the
company is constituted;

(b) the address of the registered office of the company in

Labuan or, where the certificate is issued by a branch of the
company, the address of that branch;

(c) for a foreign Labuan company, the nominal value and the
extent to which the shares are paid up; and

(d) the class of the shares.

(3) Failure to comply with this section shall not affect the rights of
any holder of shares.

(4) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.

A Labuan company may have share seal

79. A Labuan company may, if authorized by its articles, have a seal

which shall have on its face the name of the company and the words
“Share Seal”, and a share certificate under such seal shall be deemed
86 Laws of Malaysia ACT 441

to be sealed with the common seal of the company for the purposes of
this Act.

Instruments of transfer and transfer by personal representative

80. (1) A Labuan company shall not register a transfer of shares or

debentures unless a proper instrument of transfer has been delivered
to the company, but this subsection shall not prejudice any power to
register as a shareholder or debenture holder any person to whom the
right to any shares in, or debenture of, the company has been
transmitted by operation of law.

(1A) A Labuan company shall within thirty days notify the

Authority in the prescribed form of any transfer of shares or
debentures or any change of the information submitted under
subsection (1).

(2) A transfer of the share, debenture or other interest of a

deceased person made by his personal representative shall, although
the personal representative is not himself a member of the company,
be as valid as if he had been such a member at the time of the
execution of the instrument of transfer.

(3) The production to a Labuan company of any document which

is by law sufficient evidence of probate of the will, or letters of
administration of the estate, of a deceased person having been granted
to some person shall be accepted by the company, notwithstanding
anything in its articles, as sufficient evidence of the grant.

(4) In this section “instrument of transfer” includes a written

application for transmission of a share, debenture or other interest to
a personal representative.

Duties of Labuan company with respect to issue of certificate

81. (1) Every Labuan company shall, within two months after the
allotment of any of its shares or debentures, and within one month
 Labuan Companies 87

after the date on which a transfer (other than such a transfer as the
company is, for any reason, entitled to refuse to register and does not
register) of any of its shares or debentures is lodged with the
company, complete and have ready for delivery all the appropriate
certificates and debentures in connection with the allotment or
transfer, unless the conditions of issue of the shares or debentures
otherwise provide.

(2) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.

Penalty: Ten thousand ringgit. Default penalty.

(3) If a Labuan company on which a notice has been served

requiring it to make good any default in complying with the
provisions of this section fails to make good the default within
twenty-one days after the service of the notice, the Court may, on the
application of the person entitled to have the certificate for the shares
or debentures delivered to him, direct the company and every officer
of the company to make good the default within such time as is
specified in the direction, and the direction may provide that all costs
and expenses of and incidental to the application shall be borne by
the company and by any officer of the company in default in such
proportion as the Court thinks fit.

DIVISION 7

REGISTER OF CHARGES

Non-application of Division

82. Nothing in this Division shall apply to a charge created by a

foreign Labuan company on property outside Malaysia.
88 Laws of Malaysia ACT 441

Register of charges

83. (1) Every Labuan company or foreign Labuan company shall

keep at its registered office a register of charges and shall enter in it
all charges specifically affecting property of the company within one
month after the creation of such charges, giving in each case a short
description of the property charged, the amount secured by the
charge, the names of the chargees or persons entitled to such charge,
and particulars relating to the satisfaction of or release from such
charge.

(2) If any property of a Labuan company or a foreign Labuan

company is charged without such entry as required by subsection (1)
being made, every officer of the company who knowingly and
wilfully authorizes or permits the omission of such entry commits an
offence under this Act.

Penalty: *Fifty thousand ringgit and default penalty of five hundred

ringgit .

(3) Every Labuan company or foreign Labuan company shall

cause a copy of every instrument creating any charge to be kept at its
registered office.

(4) The register of charges and the copies of instruments kept in

pursuance of this section shall be open to inspection by any creditor
or member of the company at all reasonable times without charge.

(5) If default is made in complying with subsection (3) or (4), the

Labuan company or foreign Labuan company and every officer of the
company who is in default commits an offence under this Act.

Penalty: **Fifty thousand ringgit. Default penalty.

*NOTE—Previously “Ten thousand ringgit”—see subsection 26(a) of the Labuan Companies

(Amendment) Act 2022 [Act A1653].
**NOTE—Previously “Ten thousand ringgit”—see subsection 26(b) of the Labuan Companies
(Amendment) Act 2022 [Act A1653].
 Labuan Companies 89

Notice of creation and satisfaction of charge

84. (1) Every Labuan company or foreign Labuan company shall,

within one month after the creation of each charge, lodge a statement
of the prescribed particulars with the Authority, and within one
month after such charge is satisfied or released, lodge a notice in the
prescribed form with the Authority.

(2) If default is made in complying with this section, the Labuan

company or foreign Labuan company and every officer of the
company who is in default commits an offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

Assignment and variation of charge

84A. (1) If after a charge on property of a Labuan company has been

created and lodged pursuant to section 84 and if a person other than the
original charge holder becomes the new holder of the charge or any
variation to the particulars of the charge, the company shall, within
thirty days and upon payment of a prescribed fee, lodge with the
Authority a notice stating the assignment or variation and the notice
shall contain other information as may be determined by the Authority.

(2) If default is made in complying with this section, the Labuan

company and every officer of the company who is in default commits
an offence under this Act.

Penalty: Fifty thousand ringgit. Default penalty.

*NOTE—Previously “Ten”—see section 27 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
90 Laws of Malaysia ACT 441

PART V

MANAGEMENT AND ADMINISTRATION

DIVISION 1

OFFICE AND NAME

Registered office of a Labuan company

85. (1) Every Labuan company shall at all times have a registered
office in Labuan, which office shall be the principal office of a
Labuan trust company, or any other office approved by the Authority.

(2) Notice of the situation of a Labuan company’s registered office

shall be given in the prescribed form to the Authority within one
month after the date of the company’s incorporation.

(3) Where a Labuan company has changed its registered office, it

shall give notice of such change in the prescribed form to the
Authority within one month of the change.

(4) A Labuan trust company shall display at its principal office, in

a conspicuous position in romanized letters easily legible, the names
of the Labuan companies having their registered office at its address.

(5) If default is made in complying with this section, the company

and every officer of the company who is in default commits an
offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

*NOTE—Previously “Ten”—see subsection 29(b) of the Labuan Companies (Amendment) Act 2022
[Act A1653]
 Labuan Companies 91

Name to be displayed at all offices and to appear on seals, letters,

etc.

86. (1) Every Labuan company or foreign Labuan company shall

paint or affix, and keep painted or affixed, its name in a conspicuous
position, in romanized letters easily legible, on the outside of every
office or place in which its business is carried on.

(1A) If default is made in complying with subsection (1), the

Labuan company and every officer of the company who is in default
commits an offence under this Act.

Penalty: Fifty thousand ringgit. Default penalty.

(2) The name of a Labuan company or a foreign Labuan company

shall (whether or not it is carrying on business under a business
name) appear in legible romanized letters on—

(a) its seal; and

(b) all business letters, statements of account, invoices, official

notices, publications, bills of exchange, promissory notes,
endorsements, cheques, orders, receipts and letters of credit
of, or purporting to be issued or signed by or on behalf of,
the company,

and if default is made in complying with this subsection, the

company commits an offence under this Act.

(2A) The name of a Labuan company or a foreign Labuan company

shall (whether or not it is carrying on business under a business
name) appear in legible romanized letters and the company number
of the Labuan company or the foreign Labuan company shall appear
on its memorandum and articles of association and such other
documents as may be prescribed and if default is made in complying
with this subsection, the company commits an offence under this Act.

(3) Where a Labuan company or a foreign Labuan company has

changed its name, the former name of the company shall also appear
92 Laws of Malaysia ACT 441

beneath the present name on all documents, business letters,

statements of account, invoices, official notices, publications, bills of
exchange, promissory notes, endorsements, cheques, orders, receipts
and letters of credit of, or purporting to be issued or signed by or on
behalf of, the company for a period of not less than twelve months
from the date of the change.

(4) If an officer of a Labuan company or a foreign Labuan

company or any person on its behalf—

(a) uses or authorizes the use of any seal purporting to be a seal

of the company whereon its name does not so appear;

(b) issues or authorizes the issue of any business letter,

statement of account, invoice or official notice or
publication of the company wherein its name or former
name (if applicable) is not so mentioned;

(c) signs, issues or authorizes to be signed or issued, on behalf

of the company, any bill of exchange, promissory note,
cheque or other negotiable instrument or any endorsement,
order, receipt or letter of credit wherein its name or former
name (if applicable) is not so mentioned; or

(d) signs or authorizes to be signed, on behalf of the company,

the memorandum and articles of association or such other
documents as may be prescribed by the Authority when the
name and the company number of the Labuan company or
the foreign Labuan company are not so mentioned,

he commits an offence under this Act and, where he has signed,

issued or authorized to be signed or issued on behalf of the company
any bill of exchange, promissory note or other negotiable instrument
or any endorsement thereon or order wherein that name or former
name (if applicable) is not mentioned, he shall in addition be
personally liable to the holder of the instrument or order for the
amount due thereon unless it is paid by the company.
 Labuan Companies 93

Penalty: *Fifty thousand ringgit. Default penalty.

DIVISION 2

DIRECTORS AND OFFICERS

Directors

87. (1) Every Labuan company shall have one or more directors at
least one of whom shall be resident director.

(2) **A resident director of a Labuan company under subsection

(1) shall be—

(a) a trust officer of a Labuan trust company approved by the

Authority under the Labuan Financial Services and
Securities Act 2010 made available by the Labuan trust
company to be appointed as resident director; or

(b) any natural person who has attained the age of eighteen,
who is otherwise of full legal capacity, fulfills such criteria
or requirement as may be determined by the Authority and
has consented in writing to be appointed as resident
director.

(3) Any casual vacancy in directors may, so far as the articles of a

Labuan company do not otherwise provide, be filled by a person
appointed by the continuing director or directors or, if there is no
continuing director, by the Authority on application made by a
member of the company.

(4) Subject to any contrary provision in the articles of a Labuan

company, a director of a Labuan company may be a corporation and
such corporation may act by itself or through a nominee appointed in

*NOTE—Previously “Ten”—see subsection 30(c) of the Labuan Companies (Amendment) Act 2022
[Act A1653].
**NOTE—see subsection 61(1) of the Labuan Companies (Amendment) Act 2022 [Act A1653].
94 Laws of Malaysia ACT 441

writing and may be appointed or may act as a director of more than

one company.

(5) A trust officer or a natural person appointed as resident

director pursuant to paragraph (2)(a) or (2)(b), as the case may be,
may retire or resign subject to the terms of the agreement between the
Labuan trust company and the Labuan company of which he was
appointed as resident director.

(5A) (Deleted by Act A1653).

(6) A resident director of a Labuan company shall be entitled to

vote upon the resolution of the board of directors without disclosing
his interests as a director of any other Labuan company.

(7) Notice received by a resident director of a Labuan company

shall not be deemed to be notice to that company unless it is given to
the resident director specifically as notice to that company.

(8) A director of a Labuan company shall not disclose to any

person, or use for any purpose, any information obtained by reason of
his office except in accordance with his duty as a director of the
company and so far as he may be compelled by law so to do, but a
director may disclose to an appropriate public officer in Malaysia, or
otherwise use within Malaysia, any information within his knowledge
which he honestly believes suggests that a fraud is being or is likely
to be practised by the company or by any of its members or directors
or upon the company or any of its members.

(9) A director of a Labuan company who, in contravention of

subsection (8), discloses to any person, or uses for any purpose, any
information obtained by reason of his office commits an offence
under this Act.

Penalty: Three million ringgit or imprisonment for a term not

exceeding five years or both.

(10) The fees payable for the appointment as resident director shall
be paid—
 Labuan Companies 95

(a) in the case of the trust officer appointed as resident director

of Labuan company pursuant to paragraph 2(a), to the
Labuan trust company which made him available for the
appointment; and

(b) in the case of the natural person appointed as resident

director of Labuan company pursuant to paragraph 2(b),
directly to the person.

(11) Notwithstanding any other provision of this Act or the

regulations to the contrary, and unless otherwise provided in the
articles of a Labuan company, a resident director of a Labuan
company shall not be liable to any penalty provided for under this
Act for any damage caused to or suffered by any person, howsoever
arising, otherwise than by reason of his wilful misconduct, wilful
default or wilful neglect.

Consent to act as director

88. A person shall not be appointed or named as a director or

proposed director in the articles of a Labuan company unless, before
the registration of the articles, he has, by himself or by his agent
authorized in writing for the purpose, signed and caused to be lodged
with the Authority a consent in writing to act as a director.

Validity of acts of directors

89. The acts of a director of a Labuan company shall be valid

notwithstanding any defect that may be discovered in his
appointment or qualification.

Persons disqualified from being a director

90. (1) A person shall not be appointed as a director or hold office

or take part or be in any way directly or indirectly concerned with or
in the management of a Labuan company, if the person—
96 Laws of Malaysia ACT 441

(a) has been convicted of any offence in connection with the

formation or management of a corporation or company;

(b) has been convicted of any offence involving fraud, bribery

or dishonesty;

(c) is an undischarged bankrupt or insolvent; or

(d) is deemed unfit by the Authority.

(2) The Labuan company shall ensure that no person acting or

nominated to act as a director or hold office or take part or be in any
way directly or indirectly concerned with or in the management of a
Labuan company is a disqualified person under subsection (1).

(3) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: One million ringgit or imprisonment for a term not

exceeding five years or both.

Disclosure of interest in contracts, property, offices, etc.

91. (1) Subject to this section, every director of a Labuan company

who is in any way, whether directly or indirectly, interested in a
contract or proposed contract with the company shall, as soon as
practicable after the relevant facts have come to his knowledge,
declare the nature of his interest at a meeting of the directors of the
company or cause to be circulated in writing to all the other directors
particulars of his interest.

(2) Subsection (1) shall not apply in a case where the interest of
the director of a Labuan company consists only in him being a
member or creditor of another Labuan company which is interested in
a contract or proposed contract with the first-mentioned company, if
that interest may properly be regarded as not being a material interest.
 Labuan Companies 97

(3) For the purposes of this section, a resident director shall be

deemed to be interested in all contracts or proposed contracts with
any Labuan company of which he is a director and to be exempted
from any requirement of circulation of notice or declaration in
writing; and an oral declaration noted in the minutes is deemed
sufficient compliance with the provisions of subsection (1).

(4) Subject to any contrary provision in the articles of a Labuan

company, a director of the company shall not, for the purposes of this
section, be deemed to be interested in or to have at any time been
interested in a contract or proposed contract, by reason that the
contract or proposed contract—

(a) has been or will be made with;

(b) is for the benefit of; or

(c) is on behalf of,

a company which, by virtue of the provisions of section 4, is deemed

to be a related company, and that he is also a director of that
company.

(5) For the purposes of subsection (1), a general notice given to

the directors of a Labuan company by a director to the effect that he
is an officer or a member of a specified corporation or a member of a
specified firm and he is to be regarded as interested in any contract
which may, after the date of the notice, be made with that company or
firm shall be deemed to be sufficient declaration of interest in relation
to any contract so made, but no such notice shall be of effect unless
either it is given at a meeting of the directors or the director takes
reasonable steps to ensure it is brought up and read at the next
meeting of the directors after it is given.

(6) Every director of a Labuan company who holds any office or

possesses any property whereby, whether directly or indirectly, duties
or interests might be created in conflict with his duties or interests as
a director, shall declare at a meeting of the directors of the company
98 Laws of Malaysia ACT 441

or cause to be circulated in writing to the other directors the fact and

the nature, character and extent of the conflict:

Provided that this subsection shall not apply to a resident director

unless the articles of the company otherwise provide.

(7) The declaration required of a director under subsection (6)

shall be made at the first meeting of the directors held—

(a) after he becomes a director; or

(b) (if he is already a director) after he commences to hold the

office or to possess the property,

unless the fact has already been circulated in writing before that
meeting.

(8) Every declaration under this section shall be recorded in the

minutes of the meeting at which it was made.

(9) This section shall be in addition to and not in derogation of the

operation of any rule of law or any provision in the articles of a
Labuan company restricting a director of that company from having
any interest in contracts with the company or from holding office or
possessing properties involving duties or interests in conflict with his
duties or interests as a director:

Provided that this subsection does not apply to a resident director

unless the articles of the company otherwise provide.

(10) For the purposes of this section, an interest of a director shall

be treated as including an interest of a member of the director’s
family and the words “member of the director’s family” shall include
his spouse, son, adopted son, step-son, daughter, adopted daughter
and step-daughter.

(11) If default is made in complying with this section, the director

of the company who is in default commits an offence under this Act.
 Labuan Companies 99

Penalty: Three million ringgit or imprisonment for a term not

exceeding five years or both.

Duty and liability of officers

92. (1) Every officer of a Labuan company shall at all times act
honestly and use reasonable diligence in the discharge of the duties of
his office.

(2) A director of a Labuan company shall at all times exercise his

powers for a proper purpose and in good faith in the best interest of
the Labuan company.

(3) A director of a Labuan company shall exercise reasonable care,

skill and diligence with—

(a) the knowledge, skill and experience which may reasonably

be expected of a director having the same responsibilities;
and

(b) any additional knowledge, skill and experience which the

director in fact has.

(4) A director who makes a business judgment is deemed to meet

the requirements of the duty under subsection (3) and the equivalent
duties under the common law and in equity if the director—

(a) makes the business judgment in good faith for a proper

purpose;

(b) does not have a material personal interest in the subject

matter of the business judgment;

(c) is informed about the subject matter of the business

judgment to the extent the director reasonably believes to be
appropriate under the circumstances; and
100 Laws of Malaysia ACT 441

(d) reasonably believes that the business judgment is in the best

interest of the Labuan company,

and for the purpose of this subsection, “business judgment” means

any decision on whether or not to take action in respect of a matter
relevant to the business of the company.

(5) A director may rely on information, professional or expert

advice, opinions, reports or statements including financial statements
and other financial data, prepared, presented or made by—

(a) any officer of the Labuan company whom the director

believes on reasonable grounds to be reliable and competent
in relation to matters concerned;

(b) any other person retained by the Labuan company as to

matters involving skills or expertise in relation to matters
that the director believes on reasonable grounds to be within
the person’s professional or expert competence;

(c) another director in relation to matters within the director’s

authority; or

(d) any committee to the board of directors on which the

director did not serve in relation to matters within the
committee’s authority.

(6) The director’s reliance made under subsection (5) is deemed to

be made on reasonable grounds if it was made —

(a) in good faith; and

(b) after making an independent assessment of the information

or advice, opinions, reports or statements, including
financial statements and other financial data, having regard
to the director’s knowledge of the Labuan company and the
complexity of the structure and operation of the Labuan
company.
 Labuan Companies 101

(7) Except as otherwise provided by this Act, the memorandum or

articles of association of the Labuan company or any resolution of the
board of directors or shareholders of the Labuan company, the
directors may delegate any power of the board of directors to any
director, committee to the board of directors, officer, employee,
expert or any other person.

(8) Where the directors have delegated any power as referred to in

subsection (7), the directors are responsible for the exercise of such
power by the delegatee as if such power had been exercised by the
directors themselves.

(9) The directors are not responsible under subsection (8) if—

(a) the directors believed on reasonable grounds at all times

that the delegatee would exercise the power in conformity
with the duties imposed on the directors under this Act and
the memorandum and articles of association of the company
(if any); and

(b) the directors believed on reasonable grounds, in good faith

and after making a proper inquiry if the circumstances
indicated the need for the inquiry, that the delegatee was
reliable and competent in relation to the power delegated.

(10) An officer of a Labuan company shall not make improper use

of any information acquired by reason of his office to gain, whether
directly or indirectly, an advantage for himself or any other person or
to cause detriment to the company.

(11) An officer of a Labuan company who contravenes this section

shall be liable to the company for any profits made by him and for
any damage suffered by the company as a result of such
contravention.

(12) A director of a Labuan company who makes a solvency

declaration, pursuant to the provisions of this Act, without having
reasonable grounds for the opinions expressed in it shall be
criminally liable for any monies or gains received.
102 Laws of Malaysia ACT 441

Penalty: Five hundred thousand ringgit or imprisonment for a term

not exceeding five years or both.

(12A) If default is made in complying with subsection (3), the

director of the Labuan company who is in default commits an offence
under this Act.

Penalty: Three million ringgit or imprisonment for a term not

exceeding five years or both.

(13) This section is in addition to and not in derogation of any

other written law or rule of law relating to the duty or liability of
directors or officers of a Labuan company.

Secretary

93. (1) Every Labuan company shall appoint one or more

secretaries at least one of whom shall be a resident secretary.

(1A) Subject to subsection (2) and any contrary provision in the

memorandum and articles of association of a Labuan company, a
secretary of a Labuan company may be a corporation and such
corporation may act by itself or through a nominee appointed in
writing and may be appointed or may act as a secretary of more than
one company.

(2) *No person, other than a trust officer of a Labuan trust

company approved by the Authority under the Labuan Financial
Services and Securities Act 2010, or a Labuan company or a
domestic company, wholly owned by the Labuan trust company and
approved by the Authority, made available for the appointment by the
Labuan trust company shall act or be appointed as a resident
secretary.

(2A) A resident secretary of a Labuan company may resign subject

to the terms of the agreement between the Labuan trust company

*NOTE—see subsection 61(3) of the Labuan Companies (Amendment) Act 2022 [Act A1653].
 Labuan Companies 103

which made the person available for the appointment and the Labuan
company concerned and such Labuan company shall appoint a
replacement resident secretary not later than thirty days from the
effective date of the resignation.

(2B) The Labuan trust company shall lodge with the Authority a
notice of the resignation pursuant to subsection (2A).

(2C) Where the Labuan company fails to appoint a replacement

resident secretary within thirty days from the effective date of
resignation pursuant to subsection (2A), the company is deemed to be
struck off the register.

(3) Subject to subsection (4), the resident secretary of a Labuan

company shall be responsible for the compliance by the company
with the requirements of this Act in relation to the lodging of all
documents with the Authority and the maintenance of the company’s
records at the registered office of the company and dealing with
communications served to the company at its registered office.

(4) Notwithstanding any other provision in this Act to the

contrary, the resident secretary shall not be liable as an officer of the
company to any penalty provided for in this Act save for anything
done or omitted to be done by him in carrying out the duties of his
office, nor shall he be liable for any damage caused to or suffered by
any person how so ever arising otherwise than by reason of his wilful
misconduct, wilful default or wilful neglect.

(5) A Labuan company shall forthwith pay any costs, charges and
expenses incurred by the resident secretary in respect of anything
done under this Act on behalf of the company.

(6) The salary of the resident secretary of a Labuan company

payable by a Labuan company shall be paid directly to the Labuan
trust company which made him available for the appointment.

(7) Every secretary of a Labuan company shall be appointed by

the directors of the company.
104 Laws of Malaysia ACT 441

Register of directors and secretaries

94. (1) Every Labuan company shall keep at its registered office in
Labuan a register of its directors and secretaries.

(2) The register shall contain with respect to each director, in the
case of an individual, his present full name and any former name, his
usual business or residential address and identification (if any) and
the name of the Labuan trust company of which he is an officer and
the address of its registered office, or in the case of a corporation, the
corporation’s full name, the address of its registered office and the
names of its authorized nominees and representatives in Labuan.

(3) The register shall contain with respect to each secretary, in the
case of an individual, his present full name and any former name, his
usual business or residential address and identification (if any) and
the name of the Labuan trust company of which he is an officer and
the address of its registered office, or in the case of a corporation, the
corporation’s full name, the address of its registered office and the
names of its authorized nominees and representatives in Labuan.

(4) The register kept by a Labuan company shall be open for

inspection by any director, member or auditor of the company
without charge.

(5) A Labuan company shall lodge with the Authority —

(a) within one month after its incorporation, a return in the

prescribed form containing, in relation to its directors and
secretaries, the particulars required to be specified in the
register;

(b) within one month after a person named in a return ceases to

be a director or secretary of the company, a return in the
prescribed form notifying the Authority of the change and
containing with respect to each then director or secretary of
the company the particulars required to be specified in the
register and the date of cessation;
 Labuan Companies 105

(c) within one month after a person becomes a director or a

secretary of the company, a return in the prescribed form
notifying the Authority of that fact and containing the
particulars required to be specified in the register and the
date of appointment; and

(d) within one month of any change in the prescribed

particulars of directors and secretaries, a notice in the
prescribed form notifying the Authority of the change.

(6) If default is made by a Labuan company in complying with

any provision of this section, the company and every officer of the
company who is in default commits an offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

(7) In this section, “identification” means —

(a) in the case of a person issued with an identity card, the

number of the identity card;

(b) in the case of a person not issued with an identity card,

particulars of his passport;

(c) in the case of a corporation, the incorporation or registration

number; or

(d) such other similar evidence of identification as is available.

Offence against any provision of this Act committed by

secretaries

94A. Where any offence against any provision of this Act has been
committed by any domestic company or Labuan made available by a
Labuan trust company to act or be appointed as resident secretary of a

*NOTE—Previously “Ten”—see section 36 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
106 Laws of Malaysia ACT 441

Labuan company, any person who at the time of the commission of

the offence was a director or an officer of the Labuan trust company
or was purporting to act in any such capacity, or was in any manner
or to any extent responsible for the management of any of the affairs
of such Labuan trust company, commits an offence under this Act
unless he proves that the offence was committed without his consent
or connivance and that he exercised all such diligence to prevent the
commission of the offence as he ought to have exercised, having
regard to the nature of his function in that capacity and all the
circumstances.

Removal of director

94B. (1) Notwithstanding anything in the constituent documents of

a Labuan company or in any agreement between a Labuan company
and a director, a director of the Labuan company may be removed
from office by its shareholder’s resolution, in accordance to its
memorandum or articles, which is passed at a meeting called for the
purpose that include the removal of a director.

(2) The notice of the meeting shall state that the purpose of the
meeting is the removal of the director.

(3) Where permitted by the memorandum or articles of a Labuan

company, a director of the Labuan company may be removed from
office by the directors of the Labuan company.

DIVISION 3

MEETINGS AND PROCEEDINGS

Meetings of members

95. (1) Subject to any limitations in the memorandum or articles,

the directors of a Labuan company may convene meetings of the
members of the company in such manner and at such times and
 Labuan Companies 107

places within or outside Labuan as the directors consider necessary or

desirable.

(2) The directors of a Labuan company, notwithstanding anything

in the articles, shall, on the requisition of ten or more members, or
members holding at the date of the deposit of the requisition not less
than one-tenth of the total paid-up capital of the company, forthwith
proceed to convene a meeting of members.

(3) Subject to any limitations in its memorandum and articles, a

Labuan company may hold all meetings of its members within
Malaysia, or elsewhere, at more than one venue using any technology
that allows all members a reasonable opportunity to participate in the
meetings.

(4) A member may be represented at a meeting of members by a

proxy who may speak and vote on his behalf.

(5) The following provisions apply in respect of joint ownership of

shares:

(a) if two or more persons hold shares jointly, each of them

may be present in person or by proxy at a meeting of
members and may speak as a member;

(b) if only one of them is present in person or by proxy, he may

vote on behalf of all of them; and

(c) if two or more of them are present in person or by proxy,

they shall vote as one.

Notice of meetings of members

96. (1) Subject to any requirement in the memorandum or articles

to give longer notice, the directors shall give not less than seven days’
notice of meetings of members to those persons whose names on the
date the notice is given appear as members in the register of members
referred to in section 105 and who are entitled to vote at the meeting.
108 Laws of Malaysia ACT 441

(2) Notwithstanding subsection (1), but subject to any limitations

in the memorandum or articles, a meeting of members held in
contravention of the requirement to give notice is valid if members
holding a ninety per centum majority, or such lesser majority as may
be specified in the memorandum or articles, of—

(a) the total number of the shares of the members entitled to

vote on all the matters to be considered at the meeting; or

(b) the votes of each class or series of shares where members

are entitled to vote thereon as a class or series together with
an absolute majority of the remaining votes,

have waived notice of the meeting; and for this purpose, the presence
of a member at the meeting shall be deemed to constitute waiver on
his part.

(3) The inadvertent failure of the directors to give notice of a

meeting to a member, or the fact that a member has not received the
notice, shall not invalidate the meeting.

Quorum, chairman, voting, etc., at meetings

97. (1) Except as otherwise provided in the articles of a Labuan

company, where a Labuan company has more than one member, and
two or more members are present at a meeting of members, the
members present shall be a quorum, and at the meeting—

(a) any member elected by those members may be chairman

thereof; and

(b) every member shall have one vote in respect of each share
held by him.

(2) On a poll taken at a meeting, a person entitled to more than

one vote need not, if he votes, use all his votes or cast all the votes he
uses in the same way.
 Labuan Companies 109

(3) A corporation may, by resolution of its directors or other

governing body—

(a) if it is a member of a Labuan company, authorize such

person as it thinks fit to act as its representative either at a
particular meeting of members or at all meetings of
members of the company or of any class of members; or

(b) if it is a creditor, including a holder of debentures, of a

Labuan company, authorize such person as it thinks fit to
act as its representative either at a particular meeting of
members or at all meetings of any creditors of the company,

and a person so authorized shall, in accordance with his authority and

until his authority is revoked by the corporation, be entitled to
exercise, on behalf of the corporation, the same powers as the
corporation could exercise if it were an individual member, creditor
or holder of debentures of the company.

(4) Where—

(a) a person present at a meeting of members is authorized to

act as the representative of a corporation at the meeting by
virtue of an authority given by the corporation under
subsection (3); and

(b) the person is not otherwise entitled to be present at the

meeting,

the corporation shall, for the purposes of subsection (1), be deemed to

be personally present at the meeting.

(5) A certificate under the seal of the corporation shall be

prima facie evidence of the appointment or revocation of the
appointment (as the case may be) of a representative pursuant to
subsection (3).

(6) Where —
110 Laws of Malaysia ACT 441

(a) a holding company is beneficially entitled to the whole of

the issued shares of a subsidiary; or

(b) a Labuan company has only one member,

and a minute is signed by a representative of the holding company

authorized pursuant to subsection (3) or signed by the sole member
stating that any act, matter or thing, or any ordinary or special
resolution, required by this Act or by the memorandum or articles of
the subsidiary to be made, performed, or passed by or at an annual
general meeting or an extraordinary general meeting of the subsidiary
or the Labuan company has been made, performed, or passed, that
act, matter, thing or resolution shall, for all purposes, be deemed to
have been duly made, performed, or passed by or at an annual general
meeting, or as the case requires, by or at an extraordinary general
meeting of the subsidiary.

Voting by members

98. (1) Except as otherwise provided in the memorandum or

articles of a Labuan company, all shares vote as one class and each
share has one vote.

(2) The directors of a Labuan company may fix the date notice is
given of a meeting as the record date for determining the shares that
are entitled to vote at the meeting.

Action by consent of members in writing

99. Subject to any limitations in the memorandum or articles of a

Labuan company, an action that may be taken by members at a
meeting of members may also be taken by a resolution of all
members consented to in writing, or by telex, telegram, telefax, cable
or other written electronic communication, without the need for any
notice.
 Labuan Companies 111

Power of Court to direct meetings to be called

100. (1) If for any reason it is impracticable to call a meeting in any

manner in which meetings may be called or to conduct the meeting in
the manner prescribed by the articles or this Act, the Court may,
either of its own motion or on the application of any director or of
any member who would be entitled to vote at the meeting or of the
personal representative of any such member, order a meeting to be
called, held and conducted in such manner as the Court thinks fit, and
the Court may give such ancillary or consequential directions as it
thinks expedient.

(2) Any meeting called, held and conducted in accordance with

any direction made pursuant to this section shall, for all purposes, be
deemed to be a meeting duly called, held and conducted.

Special resolution

101. (1) A resolution shall be a special resolution when it has been

passed by a majority of not less than three-fourths of such members
as, being entitled so to do, vote in person or, where proxies are
allowed, by proxy, at a meeting of members of which not less than
twenty-one days’ notice specifying the intention to propose the
resolution as a special resolution has been duly given.

(2) Notwithstanding subsection (1), if it is so agreed by a majority in

number of the members having the right to vote at the meeting, being a
majority which together holds in aggregate not less than seventy-five per
centum of the total votes of the members entitled to vote, a resolution
may be proposed and passed as a special resolution at a meeting of
which less than twenty-one days’ notice has been given.

Resolutions signed by all members deemed to be duly passed at

meeting

101A. (1) Notwithstanding anything to the contrary in this Act or

the articles of the Labuan company, a resolution in writing signed by
112 Laws of Malaysia ACT 441

or on behalf of all persons for the time being entitled to receive notice
of, and to attend and vote at, general meetings of a Labuan company,
shall for the purposes of this Act, be treated as a resolution duly
passed at a general meeting of the Labuan company and, where
relevant, as a special resolution so passed.

(2) Any such resolution shall be deemed to have been passed at a

meeting held at the registered office on the date on which it was
signed by the last member.

(3) This section shall not be construed as requiring that the

persons signing a resolution under this section shall sign the same
document containing the resolution; but where two or more
documents are used for the purpose of obtaining signatures under this
section in respect of any resolution, each such document shall be
certified in advance by the Labuan trust company as containing the
true and correct version of the proposed resolution.

Resolution requiring special notice

102. Where by this Act special notice is required of a resolution, the

resolution shall not be effective unless notice of the intention to move
it has been given to the Labuan company not less than twenty-eight
days before the meeting at which it is moved, and the company shall
give its members notice of any such resolution at the same time and
in the same manner as it gives notice of the meeting or, if that is not
practicable, shall give them notice thereof in any manner allowed by
the articles not less than fourteen days before the meeting, but if, after
notice of the intention to move such a resolution has been given to
the company, a meeting is called for a date twenty-eight days or less
after the notice has been given, the notice, although not given to the
company within the time required by this section, shall be deemed to
be properly given.

103. (Deleted by Act A1367).

 Labuan Companies 113

Minutes of proceedings

104. (1) Every Labuan company shall cause minutes of all

proceedings of meetings of members and of meetings of directors to
be entered in books kept for that purpose.

(2) Unless the Authority otherwise directs, all minute books of a

Labuan company shall be kept at the registered office of the company
but duplicates of the minute books or any of them may be kept
elsewhere and shall be open for inspection by any member without
charge.

DIVISION 4

REGISTER OF MEMBERS

Register of members

105. (1) Every Labuan company shall keep a register of its

members and enter therein—

(a) the names, nationalities and addresses, and any other

relevant information and particulars, of the members, and a
statement of the shares held by each member, distinguishing
each share by its number (if any) or by the number (if any)
of the certificate evidencing the member’s holding and of
the amount paid or agreed to be considered as paid on the
shares of each member;

(b) the date at which the name of each person was entered in
the register as a member;

(c) the date at which any person who ceased to be a member

during the previous seven years so ceased to be a member;
and

(d) the date of every allotment of shares to members and the

number of shares comprised in each allotment.
114 Laws of Malaysia ACT 441

(2) The register of members shall be prima facie evidence of any

matters inserted therein as required or authorized by this Act.

(3) If default is made in complying with this section by a Labuan

company, the company and every officer of the company who is in
default commits an offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

Where register to be kept

106. (1) Unless the Authority otherwise directs, the register of

members of a Labuan company shall be kept at the registered office
of the company and shall be open for the inspection of any member
without charge.

(2) Every Labuan company shall, within one month after the
register is first kept at a place other than the registered office of the
company, lodge with the Authority notice of the place where the
register is kept and shall, within one month after any change in the
place at which the register is kept, lodge with the Authority notice of
the change.

Consequences of default by agent

107. Where the register of members is kept at some place other than
the registered office of a Labuan company and, by reason of any
default of the person in charge of such office, the company fails to
comply with section 106 or with any other requirements of this Act as
to the production of the register, that person shall be liable to the
same penalties as if he were an officer of the company who was in
default.

*NOTE—Previously “Ten”—see section 38 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
 Labuan Companies 115

Power of Court to rectify register

108. (1) If, in relation to a Labuan company—

(a) the name of any person is, without sufficient cause, entered
in or omitted from the register; or

(b) default is made or unnecessary delay takes place in entering

in the register the fact of any person having ceased to be a
member,

the person aggrieved or any member of the company may apply to

the Court for rectification of the register, and the Court may refuse
the application or may direct rectification of the register and payment
by the company of any damages sustained by any party to the
application.

(2) On any application under subsection (1), the Court may

decide—

(a) any question relating to the right or title of any person who
is a party to the application to have his name entered in or
omitted from the register, whether the question arises
between members or alleged members on the one hand and
the Labuan company on the other hand; and

(b) generally, any question necessary or expedient to be decided

for the rectification of the register.

(3) The Court when making an order for rectification of the

register shall, by its order, direct a notice of the rectification to be
lodged with the Authority.

(4) No application for the rectification of a register in respect of an

entry which was made in the register more than thirty years before
the date of the application shall be entertained by the Court.
116 Laws of Malaysia ACT 441

Beneficial ownership of Labuan company

108A. In this Act, “beneficial ownership” means a natural person

who owns or controls a Labuan company or foreign Labuan
company, in whole or in part, through direct or indirect ownership or
control of shares or voting rights or other ownership interest in the
Labuan company or foreign Labuan company, or who exercises
effective control and influence in the Labuan company or foreign
Labuan company as may be determined by the Authority.

Power of company to require disclosure of beneficial ownership

information

108B. (1) A Labuan company or foreign Labuan company shall

take reasonable steps to find out and identify the beneficial owner of
the Labuan company or foreign Labuan company, as the case may be.

(2) Any Labuan company or foreign Labuan company may, by

notice in writing, require any member of the Labuan company or
foreign Labuan company whom the Labuan company or foreign
Labuan company knows or has reasonable grounds to believe that he
is a beneficial owner in relation to the Labuan company or foreign
Labuan company—

(a) to state whether he is a beneficial owner of the Labuan

company or foreign Labuan company;

(b) to state whether he knows or has reasonable grounds to

believe that any other person is a beneficial owner of the
Labuan company or foreign Labuan company or is likely to
have that knowledge and to give such particulars of that
person that are within his knowledge; and

(c) to provide such other information within such reasonable

time as specified in the notice.

(3) Where a Labuan company or foreign Labuan company is

informed or knows or has reasonable grounds to believe, that any
 Labuan Companies 117

other person is a beneficial owner of the Labuan company or foreign

Labuan company, or is likely to have that knowledge, the Labuan
company or foreign Labuan company may by notice in writing
require that other person—

(a) to state whether he is a beneficial owner of the Labuan

company or foreign Labuan company;

(b) to state whether he knows or has reasonable grounds to

believe that any other person is a beneficial owner of the
Labuan company or foreign Labuan company, or is likely to
have that knowledge and to give such particulars of that
other person that are within his knowledge; and

(c) to provide such other information within such reasonable

time as specified in the notice.

(4) Any Labuan company or foreign Labuan company may, by

notice in writing, require any member of the Labuan company or
foreign Labuan company to inform the Labuan company or foreign
Labuan company, within a reasonable time, as is specified in the
notice, whether ownership or control of such member in the Labuan
company or foreign Labuan company is subjected to an agreement or
arrangement under which another person is entitled to control the
member’s exercise of his interest or right and if so, to give particulars
of the agreement or arrangement and the parties to the agreement or
arrangement.

(5) A resident secretary of a Labuan company or foreign Labuan

company shall ensure that the Labuan company or foreign Labuan
company complies with the obligations under this section.

(6) If default is made in complying with this section, the Labuan

company, foreign Labuan company and every officer of the company
who is in default commits an offence under this Act.
118 Laws of Malaysia ACT 441

Duty to lodge information with the Authority

108C. (1) The particulars of beneficial ownership obtained under

section 108B shall be lodged by the Labuan company, foreign Labuan
company or the resident secretary with the Authority as part of the
annual return lodge pursuant to section 109 or 129.

(2) The Authority may, by notice in writing, direct a Labuan

company or foreign Labuan company to invoke its powers under this
section and to immediately provide the Authority with the
information obtained under section 108B.

(3) Any person who submits false or misleading or inaccurate

information to the Authority under this section commits an offence
under this Act.

Particulars of beneficial ownership

108D. (1) The particulars of beneficial ownership required under

subsection 108B(2) or (3) shall be determined by the Authority in a
guideline issued under section 108G.

(2) Whenever a Labuan company or foreign Labuan company

receives information from a person in accordance with any
requirement imposed on any person under section 108B, the Labuan
company or foreign Labuan company shall be under an obligation to
inscribe against the name of that member in a separate part of the
register kept by the company under section 105—

(a) the fact that a requirement was imposed and the date on
which it was imposed; and

(b) the information received in accordance with the

requirement.

(3) If default is made in complying with this section, the Labuan

company, foreign Labuan company and every officer of the company
who is in default commits an offence under this Act.
 Labuan Companies 119

Obligation of Labuan company to maintain and keep information

up to date

108E. (1) A Labuan company or foreign Labuan company shall

maintain and keep the particulars of beneficial ownership in its
register of members under section 105 updated from time to time.

(2) A Labuan company or foreign Labuan company shall, within

thirty days of any changes to the particulars kept under
subsection (1), lodge with the Authority such changes in the form and
manner as may be determined by the Authority.

(3) For the purposes of subsection (2), changes occur if—

(a) a person ceases to be a beneficial owner in relation to the

Labuan company or foreign Labuan company;

(b) any other changes as a result of which prescribed particulars

of the beneficial ownership in the register of members are
incorrect or incomplete;

(c) there are any changes to the particulars of the shareholders

contained in the register; or

(d) a person ceases to be, or becomes, a shareholder of the

Labuan company or foreign Labuan company.

(4) A resident secretary of a Labuan company or foreign Labuan

company shall ensure that the Labuan company or foreign Labuan
company complies with the obligations under this section.

(5) If default is made in complying with this section or if the

Labuan company or foreign Labuan company submits false or
misleading or inaccurate information to the Authority under this
section, the Labuan company, foreign Labuan company and every
officer of the company who is in default commits an offence under
this Act.
120 Laws of Malaysia ACT 441

Power of Authority to require submission and examination

108F. (1) The Authority may at any time, by notice in writing,

require a Labuan company, foreign Labuan company, a resident
secretary or any person the Authority deems appropriate to furnish all
the necessary information and particulars of any beneficial owner of
the Labuan company or foreign Labuan company and have the
information and particulars verified by a statutory declaration.

(2) Any Labuan company, foreign Labuan company, resident

secretary or person served with the notice under subsection (1) shall
comply with such notice within seven days of the receipt of such
notice.

(3) Notwithstanding subsection (1), the Authority may use its

power under sections 28B and 28C of the Labuan Financial Services
Authority Act 1996 in relation to the particulars of beneficial
ownership and information kept by the Labuan company or foreign
Labuan company pursuant to this Division.

(4) If default is made in complying with this section, the Labuan

company, foreign Labuan company or resident secretary and every
officer of the company who is in default commits an offence under
this Act.

Penalty: One million ringgit and in the case of a continuing offence,

to a further fine of ten thousand ringgit for each day during which the
offence continues after conviction.

(5) If default is made in complying with this section, the person

who is in default commits an offence under this Act.

Penalty: Imprisonment for a term not exceeding ten years or a fine

three million ringgit or both, and in the case of a continuing offence,
to a further fine of ten thousand ringgit for each day during which the
offence continues after conviction.
 Labuan Companies 121

Power of Authority to issue guidelines

108G. The Authority may issue guidelines pursuant to section 4A of

the Labuan Financial Services Authority 1996 to clarify any
provision of this Division.

Removal of entries from register

108H. An entry relating to a natural person who used to be a

beneficial owner may be removed from the register of members
under section 105 after the expiration of six years from the date on
which the natural person ceases to be a beneficial owner in relation to
the Labuan company or foreign Labuan company.

DIVISION 5

ANNUAL RETURN

Annual return

109. (1) A Labuan company shall make an annual return containing

the prescribed particulars and accompanied by such copies of
documents as are required to be included in the return.

(2) The annual return shall be in accordance with the form

prescribed for the purpose or as near thereto as circumstances permit
and shall be dated not earlier than fourteen days before the date of
lodgement.

(3) The annual return signed by a director or secretary of the

company shall be lodged with the Authority, once in each calendar
year, not later than thirty days prior to the anniversary of the date of
its incorporation.

(4) A Labuan company not having a share capital shall lodge with
the Authority a return in the prescribed form containing the
122 Laws of Malaysia ACT 441

particulars referred to in subsection (5) and made up in accordance

with subsection (3).

(5) The return of a Labuan company not having a share capital

shall contain the following particulars:

(a) the address of the registered office of the Labuan company;

(b) where the register of members is kept elsewhere than at that

the registered office of the Labuan company, the address of
the place where the register is kept;

(c) particulars of the total amount of indebtedness of the

Labuan company in respect of all charges, whether required
to be registered with the Authority or not;

(d) all such particulars with respect to the persons who on the
day to which the return is made up are the directors,
managers or secretaries of the Labuan company as are
required to be contained in the register of directors,
managers and secretaries;

(e) the name and address of the auditor of the Labuan company;
and

(f) such other matters relating to the accounts of the Labuan

company.

(6) If a Labuan company fails to comply with this section, the

company and every officer of the company who is in default commits
an offence under this Act.

Penalty: Ten thousand ringgit. Default penalty.

 Labuan Companies 123

PART VI

ACCOUNTS AND AUDIT

DIVISION 1

ACCOUNTS

Accounts to be kept

110. (1) A Labuan company shall cause to be kept proper

accounting and other records as will sufficiently explain the
transaction and financial position of the company.

(2) Every company and the directors thereof shall cause

appropriate entries to be made in the accounting and other records of
the company within ninety days of the completion of the transactions
to which they relate.

(3) The accounting and other records of a Labuan company shall

be kept at the registered office of the company or at such other place
in Labuan as the directors think fit and shall at all times be open to
inspection by any director and shall be kept in such manner as to
enable them to be conveniently and properly audited.

(3A) If default is made in complying with subsection (1), (2) or (3),

the director of the Labuan company who is in default commits an
offence under this Act.

Penalty: Five hundred thousand ringgit or imprisonment for a term

not exceeding five years or both.

(4) The Authority may, in any particular case, direct that the
accounting and other records of a Labuan company be open to
inspection by an approved auditor acting for a director, but only upon
an undertaking in writing given to the Authority that information
acquired by the auditor during his inspection shall not be disclosed by
him except to that director.
124 Laws of Malaysia ACT 441

(5) Any director of a Labuan company who fails to take all

reasonable steps to secure compliance by the company with the
requirements of this section, or a resident director who has by his
own wilful act been the cause of any default by the company under
the said sections, commits an offence under this Act.

Audited accounts to be laid before meeting

111. (1) The directors of a Labuan company shall cause to be laid

before the company at a meeting of members the audited accounts or
unaudited accounts, as the case may be, of the company not more
than nine months after the date to which the audited accounts or
unaudited accounts are made up.

(1A) A Labuan company shall lodge with the Authority an annual

certificate from a director within thirty days of the accounts being
laid before the company at a meeting of members stating that he has
considered the audited or unaudited accounts mentioned in
subsection (1) and certifying, with or without qualifications—

(a) that those accounts show that the company was solvent at
the date they were made up;

(b) that he is unaware of any circumstances which may render

those accounts untrue; and

(c) that no circumstances have occurred since the date to which

those accounts were made up which would render the
company insolvent, and if such a certificate cannot be given
without qualification, the aspects in which it is qualified
shall be set out.

(2) A copy of the audited accounts laid at the meeting of members

of the company together with its relevant resolution shall be lodged
with the Authority within one month after it is so laid.
 Labuan Companies 125

(2A) A Labuan company shall lodge with the Authority a

certificate from an approved auditor within thirty days of the
accounts being laid before the company at a meeting of members
stating that—

(a) the proper accounts of the company for the financial period
ending on the date specified have been kept and a balance
sheet and profit and loss account for that period have been
prepared and audited by that auditor; and

(b) the director giving the certificate under subsection (1A) has
been furnished with a copy of those accounts.

(2B) The approved auditor shall retain for seven years a copy of the
accounts to which his certificate relates.

(2C) Notwithstanding the time periods imposed in subsections (1)

and (2), the Authority may, on the application of the Labuan
company, if for any special reason the Authority thinks fit to do so,
extend the time periods notwithstanding that the periods so extended
are beyond the calendar year.

(3) If default is made in complying with subsection (2) or (2A), the

Labuan company and every officer of the company commits an
offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

Audited accounts to be sent to members

112. (1) A copy of every audited accounts or unaudited accounts, as

the case may be, which are to be laid before a Labuan company at a
meeting of members accompanied by a copy of the auditor’s report
thereon (if applicable) shall, not less than seven days before the date
of the meeting, be sent to all members of the company.

*NOTE—Previously “Ten”—see paragraph 41(b)(ii) of the Labuan Companies (Amendment) Act 2022
[Act A1653].
126 Laws of Malaysia ACT 441

(2) Any director of a Labuan company who fails to take all

reasonable steps to secure compliance by the company with the
requirements of this section or a resident director who has by his own
wilful act been the cause of any default by the company under this
section, commits an offence under this Act.

Penalty: Fifty thousand ringgit and default penalty of five hundred

ringgit.

DIVISION 2

AUDIT

Auditor to be appointed

113. (1) A Labuan company or a foreign Labuan company shall not

be required to appoint a person or persons to be the auditor or
auditors of the company unless—

(a) it is required to do so under any other written laws in

Labuan in respect of financial services;

(b) its articles so provide; or

(c) it makes an offer for subscription or purchase, or issues an

invitation to subscribe for or purchase, securities pursuant to
subsection 8(1) of the Labuan Financial Services and
Securities Act 2010 and such offer or invitation is not
excluded under subsection 8(5) of that Act, or
subsection 13(1) of the Labuan Islamic Financial Services
and Securities Act 2010 and such offer or invitation is not
excluded under subsection 13(5) of that Act.

(1A) Notwithstanding subsection (1), the Authority may, if it is

satisfied that there has been a breach of section 110 or 111 or that it is
otherwise in the public interest to do so, by notice in writing to a
company exempt under either of those sections, require that company
 Labuan Companies 127

to lodge with the Authority, within such time as may be specified in

that notice—

(a) its accounts duly audited by the auditor or auditors of the

company or, where none has been appointed, an auditor or
auditors to be appointed by the directors of the company for
this purpose; and

(b) an auditor’s report referred to in section 117 in relation to

those accounts prepared by the auditor or auditors of the
company.

(2) A Labuan company shall, whenever it appoints an auditor,

lodge with the Authority, within thirty days of the appointment, a
notice thereof in the prescribed form accompanied by the auditor’s
written consent.

(3) Any director of a Labuan company who fails to take all

reasonable steps to secure compliance by the company with the
requirements of this section or a resident director who has by his own
wilful act been the cause of any default by the company under this
section, commits an offence under this Act.

113A. (Deleted by Act A1367).

Removal and resignation of auditors

114. (1) A Labuan company may, at a meeting of members of

which special notice has been given to the auditor and the Authority,
but not otherwise, remove an auditor from office, but shall, at that
meeting at which the auditor is removed or at a meeting of members
held within one month thereafter, appoint an approved auditor to take
the place of the auditor so removed.

(2) An auditor of a Labuan company may, if he is not a sole

auditor, resign at any time but a sole auditor of a Labuan company
may only resign at a meeting of members.
128 Laws of Malaysia ACT 441

(3) If an auditor gives notice in writing to the directors of a

Labuan company that he desires to resign, the directors shall, as soon
as is practicable, call a meeting of members of the company for the
purpose of appointing an auditor in place of the auditor who desires
to resign, and on the appointment of another auditor, the resignation
shall take effect.

(4) A Labuan company shall, within thirty days of any change in

the auditor of the company, lodge with the Authority a notice and the
notice shall be accompanied with the consent of the new auditor.

(4) (Deleted by Act A1367).

Remuneration of auditor

115. The fees and expenses of an auditor of a Labuan company,

unless required by the auditor to be fixed by a resolution of the
members of the company, may be fixed by the directors.

Auditor may attend meetings

116. An auditor of a Labuan company may attend and address all

meetings of members of the company.

Rights and duties of auditors

117. (1) Every auditor of a Labuan company shall report to the

members whether, in his opinion, the accounts of the company are
properly drawn up so as to give a true and fair view of the company’s
affairs.

(2) Every auditor of a Labuan company shall be entitled to be

furnished with a copy of the memorandum and articles of the
company and shall familiarise himself with the terms and conditions
contained therein.
 Labuan Companies 129

(3) If an auditor in the course of performance of his duties as an

auditor of a Labuan company is of the opinion that a serious offence
involving fraud or dishonesty is being or has been committed against
the Labuan company or this Act by the officers of the Labuan
company, he shall forthwith report the matter in writing to the
Authority.

(4) No duty to which an auditor of a Labuan company may be

subjected to shall be regarded as having been contravened by reason
of his reporting the matter referred to in this section in good faith to
the Authority.

PART VII

ARRANGEMENTS AND RECONSTRUCTIONS

Arrangements

118. (1) In this section “arrangement” means —

(a) a reorganization or reconstruction of a Labuan company

incorporated under this Act;

(b) a merger or consolidation of one or more Labuan companies

with one or more other Labuan companies, if the surviving
company or the consolidated company is a Labuan
company;

(c) a separation of two or more businesses carried on by a

Labuan company;

(ca) a merger or consolidation of one or more Labuan companies

with one or more corporations; or

(d) any combination of any of the things specified in

paragraphs (a) to (ca).
130 Laws of Malaysia ACT 441

(2) The directors of a Labuan company may, by a resolution of

directors, approve a plan of arrangement that contains the details of
the proposed arrangement.

(3) Upon approval of the plan of arrangement by the directors, the

Labuan company shall make an application to the Court for approval
of the proposed arrangement.

(4) The Court may, upon an application made under

subsection (3), make an interim or final order, and in making the
order the Court may—

(a) determine what notice, if any, of the proposed arrangement

is to be given to any person;

(b) determine whether approval of the proposed arrangement by

any person should be obtained and the manner of obtaining
the approval;

(c) determine whether any holder of shares, debt obligations

other securities in the company may dissent from the
proposed arrangement and receive payment of the value of
his shares, debt obligations or other securities;

(d) conduct a hearing and permit any interested persons to

appear; and

(e) approve or reject the plan of arrangement as proposed or

approve it with such amendments as it may direct:

Provided that the Court is satisfied that the requirements of the laws
of the jurisdictions in which the corporation was incorporated,
registered or established in order to allow it to proceed with the
arrangement have been complied with.

(5) Where the Court makes an order approving a plan of

arrangement, the directors of the Labuan company, if they are still
desirous of executing the plan, shall confirm the plan of arrangement
 Labuan Companies 131

as approved by the Court, whether or not the Court has directed any
amendments to be made thereto.

(6) The directors of the Labuan company, upon confirming the

plan of arrangement, shall—

(a) give notice to the persons to whom the Court has required
notice to be given; and

(b) submit the plan of arrangement to those persons for

approval if required by the order of the Court.

(7) After the plan of arrangement has been approved by those

persons from whom approval is required by the order of the Court,
the articles of arrangement shall be executed by the Labuan company
and shall contain—

(a) the plan of arrangement;

(b) the order of the Court approving the plan of arrangement;

and

(c) the manner in which the plan of arrangement was approved,

if approval is required by the order of the Court.

(8) The articles of arrangement shall be lodged with the Authority

who shall retain and register them in the register.

(9) Upon registration of the articles of arrangement, the Authority

shall issue a certificate under its seal certifying that the articles of
arrangement have been registered.

(10) A certificate of arrangement issued by the Authority under

subsection (9) shall be prima facie evidence of compliance with all
the requirements of this Act in respect of the arrangement.

(11) An arrangement shall be effective as from the date the articles

of arrangement are registered by the Registrar or on such date
subsequent thereto, which date shall not be more than thirty days
132 Laws of Malaysia ACT 441

from the date the articles of arrangement are registered with the
Authority, as is stated in the articles of arrangement.

Amalgamations

118A. (1) Notwithstanding section 118, two or more Labuan

companies (each to be referred to as an “amalgamating Labuan
company”) may amalgamate and continue as a new Labuan company:

Provided that an amalgamating Labuan company shall not be a

licensed entity under the Labuan Financial Services and Securities
Act 2010 or the Labuan Islamic Financial Services and Securities
Act 2010.

(2) An amalgamation proposal shall contain the terms of an

amalgamation under subsection (1) and, in particular—

(a) the name of the amalgamated Labuan company;

(b) the registered office of the amalgamated Labuan company;

(c) the full name and residential address of every director of the
amalgamated company;

(d) the share structure of the amalgamated Labuan company,

specifying—

(i) the number of shares of the amalgamated Labuan

company;

(ii) the rights, privileges, limitations and conditions

attached to each share of the amalgamated Labuan
company; and

(iii) whether the shares are transferable or nontransferable

and, if transferable, whether their transfer is subject to
any condition or limitation;
 Labuan Companies 133

(e) a copy of the memorandum and articles of the amalgamated

Labuan company;

(f) the manner in which the shares of each amalgamating

Labuan company are to be converted into shares of the
amalgamated Labuan company;

(g) if shares of an amalgamating company are not to be

converted into shares of the amalgamated company, the
consideration that the holders of those shares are to receive
instead of the shares of the amalgamated company;

(h) any payment to be made to any member or director of an

amalgamating Labuan company, other than a payment of
the kind described in paragraph (g); and

(i) details of any arrangement necessary to complete the

amalgamation and to provide for the subsequent
management and operation of the amalgamated Labuan
company.

(3) An amalgamation proposal shall specify the date on which the

amalgamation is intended to become effective.

(4) If the shares of one of the amalgamating Labuan companies are

held by or on behalf of another of the amalgamating Labuan
companies, the amalgamation proposal—

(a) shall provide for the cancellation of those shares without

payment or the provision of other consideration when the
amalgamation becomes effective; and

(b) shall not provide for the conversion of those shares into
shares of the amalgamated Labuan company.

(5) A cancellation of the shares under this section shall not be

deemed to be a reduction of the share capital within the meaning of
this Act.
134 Laws of Malaysia ACT 441

(6) An amalgamation proposal shall be approved by the members

of each amalgamating Labuan company by special resolution in the
manner provided in the articles of each amalgamating Labuan
company.

(7) The board of directors of each amalgamating Labuan company

shall, prior to the passing of the special resolution referred to in
subsection (6)—

(a) resolve that the amalgamation is in the best interest of the

amalgamating Labuan company;

(b) make a solvency declaration in relation to the amalgamating

Labuan company that—

(i) the amalgamating Labuan company will be able to

pay its debts as they fall due during the period of
twelve months immediately after the date on which
the amalgamation is to become effective; and

(ii) at the date of the declaration, the value of the

amalgamating Labuan company’s assets is not less
than the value of its liabilities (including contingent
liabilities).

(8) The board of directors of each amalgamating Labuan company

shall send to every member of the amalgamating Labuan company,
not less than twenty-one days before the date referred to in
subsection (3)—

(a) a copy of the amalgamation proposal (which shall include

the proposed memorandum and articles of association of the
amalgamated Labuan company);

(b) a copy of the solvency declaration given by the directors

under paragraph (7)(b);

(c) a statement of any material interests of the directors,

whether in that capacity or otherwise; and
 Labuan Companies 135

(d) such further information and explanation as may be

necessary to enable a reasonable member of the
amalgamating Labuan company to understand the nature
and implications for the amalgamating Labuan company
and its members of the proposed amalgamation.

(9) The directors of each amalgamating Labuan company shall not

less than twenty-one days before the date referred to in
subsection (3) —

(a) send a copy of the amalgamation proposal to every secured

creditor of the amalgamating Labuan company; and

(b) cause to be published in at least one newspaper widely

circulated in Malaysia and one international financial
newspaper a notice of the proposed amalgamation,
including a statement that—

(i) the copies of the amalgamation proposal are available

for inspection by any member or creditor of an
amalgamating Labuan company at the registered
offices of the amalgamating Labuan companies and at
such other places as may be specified in the notice
during ordinary business hours; and

(ii) a member or creditor of an amalgamating Labuan

company is entitled to be supplied free of charge with
a copy of the amalgamation proposal upon request to
an amalgamating Labuan company.

(10) After the proposal for amalgamation has been approved in

accordance with subsection (6), the memorandum and articles of
association of the amalgamated Labuan company shall be executed
by each amalgamating Labuan company which shall contain—

(a) the proposal for amalgamation;

(b) a copy of the declarations given by the directors under

paragraph (7)(b); and
136 Laws of Malaysia ACT 441

(c) a copy of the special resolution of each amalgamating

Labuan company approving the proposal for amalgamation
under subsection (6).

(11) The amalgamation of two Labuan companies under this

section shall create a new legal entity which shall —

(a) consistent with its articles established by the amalgamation,

possess all the rights, privileges, immunities, powers and
purposes as may be agreed by the amalgamating Labuan
companies;

(b) without further act or deed, be vested with all the property,
real and personal, including subscriptions to the shares,
causes of action and every other asset of each of the
amalgamating Labuan company; and

(c) assume and be liable for all the liabilities, obligations and
penalties of each of the amalgamating Labuan company,
and no liability or obligation due or to become due, claim or
demand for any cause existing against any such company or
any shareholder, officer or director thereof, shall be released
or impaired by the such amalgamation, and every action or
proceeding, whether civil or criminal, then pending by or
against each of the amalgamating Labuan company shall not
abate or discontinue but may be enforced, prosecuted or
settled as if the amalgamation had not occurred or may be
continued in the name of the new legal entity formed by
virtue of the amalgamation.

(12) The memorandum and articles of association of the

amalgamated Labuan company shall, together with the prescribed
fees, be lodged with the Authority, who shall retain and register them
in the register, and the amalgamation shall be effective from the date
of registration of the memorandum and articles.

(13) Upon registration of the memorandum and articles of

association of the amalgamated Labuan company, the Authority shall
issue a certificate under its seal certifying the amalgamation and that
 Labuan Companies 137

the amalgamated Labuan company is, from the date specified in the
certificate, incorporated as a Labuan company.

Amalgamation of a Labuan company, a foreign Labuan company

or a corporation and continuation as a Labuan company

118B. (1) A Labuan company, a foreign Labuan company or a

corporation may amalgamate and continue as a Labuan company
registered in Labuan to which the provisions of this Act and any other
law applicable to Labuan companies shall apply:

Provided that the Labuan company, the foreign Labuan company or

the corporation, as the case may be, shall not be a licensed entity
under the Labuan Financial Services and Securities Act 2010 or the
Labuan Islamic Financial Services and Securities Act 2010.

(2) A foreign Labuan company or corporation shall obtain all the

necessary authorizations, if any, required under the laws of the
jurisdiction in which it was incorporated or is presently registered in
order to enable it to amalgamate and continue as a Labuan company
registered in Labuan, and shall file with the Authority documentary
proof of such authorizations.

(3) The provisions of section 118A shall apply, mutatis mutandis,

to an amalgamation under this section in the same way as they apply
to an amalgamation under section 118A.

Short form amalgamation

118C. (1) Subject to subsection 118B(2), a Labuan company

(referred to as the “amalgamating holding company”) and one or
more of its wholly-owned subsidiaries (referred to as the
“amalgamating subsidiary company”) may amalgamate and continue
as one Labuan company, being the amalgamated holding company,
without complying with subsections 118A(2) to (13) if the members
of each amalgamating company, by special resolution, resolve to
138 Laws of Malaysia ACT 441

approve an amalgamation of the amalgamating companies on the

terms that—

(a) the shares of each amalgamating subsidiary company will

be cancelled without any payment or any other
consideration;

(b) the memorandum of the amalgamated Labuan company will

be the same as the memorandum of the amalgamating
holding company;

(c) the directors of the amalgamating holding company and

every amalgamating subsidiary company are satisfied that
the amalgamated Labuan company will be able to pay its
debts as they fall due during the period of twelve months
immediately after the date on which the amalgamation is to
become effective; and

(d) the person or persons named in the resolution will be the

director or directors of the amalgamated Labuan company:

Provided that the amalgamating holding company and the

amalgamating subsidiary company shall not be a licensed entity
under the Labuan Financial Services and Securities Act 2010 or the
Labuan Islamic Financial Services and Securities Act 2010.

(2) Two or more wholly-owned subsidiary companies of the same

corporation may amalgamate and continue as one Labuan company
without complying with subsections 118A(2) to (13) if the members
of each amalgamating company, by special resolution, resolve to
approve an amalgamation of the amalgamating companies on the
terms that—

(a) the shares of all but one of the amalgamating companies

will be cancelled without payment or other consideration;

(b) the memorandum of the amalgamated Labuan company will

be the same as the memorandum of the amalgamating
company whose shares are not cancelled;
 Labuan Companies 139

(c) the directors of every amalgamating company are satisfied

that the amalgamated Labuan company will be able to pay
its debts as they fall due during the period of twelve months
immediately after the date on which the amalgamation is to
become effective; and

(d) the person or persons named in the resolution will be the

director or directors of the amalgamated Labuan company:

Provided that none of the wholly-owned subsidiary companies shall

be a licensed entity under the Labuan Financial Services and
Securities Act 2010 or the Labuan Islamic Financial Services and
Securities Act 2010.

(3) The directors of each amalgamating company shall, not less

than twenty-one days before the date referred to in subsection (1) or
(2), as the case may be, give written notice of the proposed
amalgamation to every secured creditor of the amalgamating
company.

(4) The resolution referred to in subsection (1) or (2), as the case

may be, shall be deemed to be an amalgamation proposal that has
been approved.

(5) The board of directors of each amalgamating company shall,

before the date referred to in subsection (1) or (2), as the case may be,
make a solvency declaration in relation to the amalgamated Labuan
company in accordance with paragraph 118A(7)(b).

(6) A cancellation of the shares under this section shall not be

deemed to be a reduction of the share capital within the meaning of
this Act.

Effect of amalgamation

118D. (1) A certificate of amalgamation issued by the Authority

under subsection 118A(13) shall be conclusive evidence that the
140 Laws of Malaysia ACT 441

assets of the Labuan companies being amalgamated are vested in the

amalgamated Labuan company as at the date of registration.

(2) The Authority shall, as soon as practicable after the effective

date of an amalgamation, remove each of the amalgamating Labuan
companies previous names from the register.

(3) A certificate of amalgamation and incorporation issued by the

Authority shall be proof of compliance with all the requirements of
this Act in respect of the amalgamation and incorporation.

(4) The amalgamated Labuan company shall lodge, within thirty

days from the issue of the certificate in subsection 118A (13), an
authenticated copy of the certificate and an authenticated copy of the
amalgamation proposal with the appropriate authority, if any,
concerned with the registration or recording of dealings in any
movable property or an interest in movable property transferred
pursuant to the amalgamation.

(5) Where the amalgamation proposal requires the vesting of any

alienated land, or any share or interest in any alienated land in the
proposed amalgamated Labuan company—

(a) the Authority shall, where such alienated land is in

Peninsular Malaysia, pursuant to subsection 420(2) of the
National Land Code [Act 56/1965], cause an authenticated
copy of the certificate together with an authenticated copy
of the amalgamation proposal to be served on the Registrar
of Titles or the Land Administrator, as the case may be,
immediately after the issue of the certificate so that the
Registrar of Titles or the Land Administrator, as the case
may be, gives effect to subsections 420(2), (3) and (4) of the
National Land Code;

(b) where such alienated land is in Sabah, the amalgamated

Labuan company shall, as soon as practicable after the
certificate has been issued, present an authenticated copy of
such certificate to the Registrar for the registration of the
vesting of the alienated land or of the share or interest in the
 Labuan Companies 141

alienated land as provided under the Land Ordinance of

Sabah [Sabah Cap. 68]; or

(c) where such alienated land is in Sarawak, the amalgamated

Labuan company shall, as soon as practicable after the order
has been made, produce an authenticated copy of such
certificate to the Registrar for the registration of the vesting
of the alienated land or of the share or interest in alienated
land, in the amalgamated Labuan company, as provided
under section 171 of the Land Code of Sarawak [Sarawak
Cap. 81].

(6) An amalgamation proposal approved pursuant to this section

may relate to any property or business of any of the amalgamating
Labuan companies outside Malaysia and, if it so relates, effect may
be given to it either in accordance with any reciprocal arrangements
relating to enforcement of judgements that may exist between
Malaysia and the country, territory or place outside Malaysia in
which such property or business is located, or where there are no such
arrangements, in accordance with the law applicable in such country,
territory or place.

Regulations in respect of takeover, merger and amalgamation

119. The Minister may make regulations for the supervision and
control of takeover, merger and amalgamation transactions.

PART VIII

FOREIGN LABUAN COMPANIES

Interpretation

120. (1) This Part applies to a foreign company only if it has a

place of business or is carrying on business in Labuan and is not
registered under the Companies Act 2016.
142 Laws of Malaysia ACT 441

(2) In this Part the expression “carrying on business in Labuan”

includes—

(a) carrying on business in, from or through Labuan;

(b) establishing or using a share transfer or share registration

office in Labuan or administering, managing or otherwise
dealing with property situated in Labuan as an agent, legal
personal representative or trustee, whether by servants or
agents or otherwise; and

(c) in the case of a foreign Labuan company which the Minister

has by notice in writing specified for the purposes of this
paragraph—

(i) permitting or suffering the company’s own shares to

be, in Labuan, dealt with, issued, transferred or made
the subject of options or agreements;

(ii) permitting or suffering to be made in Labuan transfers

of, or dealings in respect of, or agreements or options
to sell or purchase, securities, notes or rights issued by
it to the public; or

(iii) permitting or suffering to be made in Labuan transfers

of, or dealings in respect of, or agreements or options
to sell or purchase, securities, notes or rights, by
reason of which transfers, dealings, agreements or
options the public might acquire an interest in the
company.

(3) Notwithstanding subsection (1), a foreign Labuan company

shall not be regarded as carrying on business in Labuan by reason
only of the fact that in Labuan it—

(a) is, or becomes, a party to any action or suit or any

administrative or arbitration proceedings or any claim or
dispute; or
 Labuan Companies 143

(b) conducts unsolicited isolated transactions that are completed

within a period of thirty one days, not being one of a
number of similar transactions repeated more than twice.

Registration of foreign Labuan companies

121. (1) A foreign company shall not have a place of business in

Labuan or carry on business in Labuan unless it is registered as a
foreign Labuan company under this Part, and a foreign company
which acts, and every officer thereof who permits the foreign
company to act, in contravention of this subsection commits an
offence under this Act.

(2) Every foreign company shall, prior to establishing a place of

business, or carrying on business, in Labuan, lodge with the
Authority for registration—

(a) a certified copy of the certificate of its incorporation or

registration in its place of incorporation or origin, or a
document of similar effect;

(b) a certified copy of its charter, statute or memorandum and

articles or other instrument constituting or defining its
constitution;

(c) a list of its directors and officers containing similar

particulars with respect to its directors as are required to be
contained in the register of the directors and secretaries a
Labuan company under section 94;

(d) where the list referred to in paragraph (c) includes directors

resident in Labuan who are members of the local board of
directors, a memorandum duly executed by or on behalf of
the foreign Labuan company stating the powers of the local
directors;

(e) a memorandum of appointment or power of attorney under

the seal of the foreign company or executed on its behalf in
144 Laws of Malaysia ACT 441

such manner as to be binding on the company and, in either

case, verified in the prescribed manner, stating the name of
a Labuan trust company that is authorized to accept on its
behalf service of process and any notice required to be
served on the company; and

(f) a statutory declaration in the prescribed form made by an

officer of the Labuan trust company,

and the Authority may, on payment of the prescribed fees, and

subject to this Act and any condition which it may impose, register
the company under this Part as a foreign Labuan company by
registration of the documents.

(3) The Authority shall issue a certificate in the prescribed form of

every registration of a foreign Labuan company and the certificate
shall be conclusive evidence that the requirements as to registration
have been complied with.

(4) Where a memorandum of appointment or power of attorney

lodged with the Authority in pursuance of paragraph (2)(e) is
executed by a person on behalf of a foreign Labuan company, a copy
of the deed or document by which that person is authorized to
execute the memorandum of appointment or power of attorney,
verified by statutory declaration in the prescribed manner, shall be
lodged with the Authority and the copy shall for all purposes be
regarded as an original.

(5) A foreign Labuan company shall pay an annual fee in

accordance with section 151.

Prohibition and restriction on foreign Labuan company

122. (1) A foreign Labuan company shall not carry on in Labuan

any business which a Labuan company is prohibited to carry on.

(2) The Minister may, by notice in writing, order that any foreign
Labuan company be restricted from carrying on any specified
 Labuan Companies 145

business in Labuan and may, by notice in writing, impose conditions

subject to which any specified business may be carried on by a
foreign Labuan company in Labuan.

Registered office of foreign Labuan companies

123. (1) Every foreign Labuan company shall at all times have a
registered office in Labuan, which office shall be the principal office
of a Labuan trust company.

(2) Notice in the prescribed form of the situation of the registered

office and any change thereof shall be lodged with the Authority
within one month after the date of registration of the foreign Labuan
company or the date of the change, as the case may be.

(3) If default is made in complying with this section the foreign

Labuan company and every officer of the company who is in default
commits an offence under this Act.

Penalty: *Fifty thousand ringgit. Default penalty.

Return to be lodged where documents, etc., altered

124. (1) Where any change or alteration is made in—

(a) the charter, statute, memorandum or articles of a foreign

Labuan company, or other instrument relating to the
company, lodged with the Authority;

(b) the directors of a foreign Labuan company or in the name or

address of any director;

(c) the address of the registered office of a foreign Labuan

company in its place of incorporation or origin;

*NOTE—Previously “Ten”—see section 46 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
146 Laws of Malaysia ACT 441

(d) the name of a foreign Labuan company;

(e) the powers of any directors resident in Labuan who are

members of the local board of directors of a foreign Labuan
company; or

(f) the Labuan trust company or the name or address of the

Labuan trust company referred to in paragraph 121(2)(e),

the foreign Labuan company shall, within one month after the change
or alteration, lodge with the Authority particulars of the change or
alteration and such documents as the regulations may require.

(2) Upon receipt of the aforesaid particulars of the change or

alteration, the Authority shall, subject to this Act, register the change
or alteration.

(3) On the lodging with the Authority of particulars of any change

or alteration of the name of a foreign Labuan company referred to in
paragraph (1)(d), the Authority shall issue a certificate in the
prescribed form under its seal, and that certificate shall be prima facie
evidence in all courts as to the change or alteration of the name of the
company.

(4) If a foreign Labuan company increases or decreases its

authorized share capital, it shall, within thirty days after such change,
lodge with the Authority notice of the amount from which hand to
which it has been so changed.

(5) If a foreign Labuan company not having a share capital

increases the number of its members beyond the registered number, it
shall, within thirty days after the increase was resolved on or took
place, lodge with the Authority notice of the increase.

Service on foreign Labuan companies

125. Any process or document required to be served on a foreign

Labuan company shall be sufficiently served if addressed to the
 Labuan Companies 147

foreign Labuan company and left at or sent by post to its registered

office in Labuan, but—

(a) where any such company makes default in filing with the
Authority the name and address of a registered office which
is authorized to accept on behalf of the company service of
process or notices;

(b) if at any time the registered office so notified has ceased to

exist; or

(c) if for any other reason service of process or notice cannot be

effected,

the document may be served on the company by leaving it at, or

sending it by post to, any place of business established by the
company in Labuan, or, if no such place of business has been
established, the document may be served on the company by
registered post to any place of business of the company in the country
of its incorporation.

Cessation of business in Labuan

126. If a foreign Labuan company ceases to have a place of business

or to carry on business in Labuan it shall, within one month after it so
ceases, lodge with the Authority notice of that fact, and as from the
day on which the notice is so lodged, its obligation to lodge any
document (not being a document that ought to have been lodged
before that day) with the Authority shall cease, and the Authority
shall forthwith remove the name of the foreign Labuan company
from the register.

Liquidation or dissolution of company in place of incorporation,

establishment or origin

127. (1) If a foreign company goes into liquidation or is dissolved

in its place of incorporation, establishment or origin, the foreign
148 Laws of Malaysia ACT 441

Labuan company shall, within one month after the commencement of

the liquidation or dissolution or within such further time as the
Authority in special circumstances allows, lodge or cause to be
lodged with the Authority—

(a) a notice of such liquidation or dissolution; and

(b) where a liquidator is appointed to such foreign Labuan

company in its place of incorporation, establishment or
origin (“foreign liquidator”), a notice of such appointment.

(2) Upon receipt of the notice in paragraph (1)(a), the Authority

shall forthwith appoint an approved liquidator, and until such time
that an approved liquidator is appointed to the foreign Labuan
company, the foreign liquidator shall have the powers and functions
of an approved liquidator.

(3) If the foreign Labuan company fails to lodge the notice under
paragraph (1)(a), the Authority may, at any time after the expiry of
one month after the commencement of the liquidation or the
dissolution of the foreign Labuan company, appoint an approved
liquidator to the foreign Labuan company.

(4) Upon the appointment of an approved liquidator under

subsection (2) or (3), the Court shall be deemed to have ordered that
the foreign Labuan company be wound up.

(5) The approved liquidator shall get in all the assets of the foreign
Labuan company situate or recoverable in Labuan and shall, in so
doing, have all the powers of an approved liquidator of a Labuan
company.

(6) Before paying or transferring to the foreign liquidator any of

the assets got in within Labuan, the approved liquidator shall—

(a) pay to the Authority all penalties, costs, fees and charges
due and owing;
 Labuan Companies 149

(b) pay the amount of all taxes payable under the Labuan
Business Activity Tax Act 1990 [Act 445]; and

(c) pay to any resident to whom, at the time of the appointment

of the approved liquidator in Labuan, any debt incurred
bona fide by a foreign Labuan company in respect of supply
of services to or for the foreign Labuan company is due, the
amount of such debt,

and such penalties, costs, fees, charges, taxes and debts shall be a
charge upon the assets of the foreign Labuan company ranking after
the costs of the approved liquidator appointed by the Authority but in
priority to all other charges and claims whatsoever.

(7) Until the winding up of its affairs in Labuan is completed, the

foreign Labuan company shall be deemed to continue to exist in
Labuan.

(8) The provisions of Part X of this Act relating to the striking-off

from the register of the names of defunct companies shall apply
mutatis mutandis to a foreign Labuan company.

Names of foreign Labuan companies

128. (1) Except with the consent of the Minister, a foreign Labuan
company shall not be registered by a name that, in the opinion of the
Authority, is undesirable or is a name, or includes a name, of a kind
that the Authority is not otherwise willing to accept for registration.

(2) If a foreign Labuan company is registered, either in error or

otherwise, with a name with which it should not have been registered,
the Authority may, after giving thirty days’ notice to the foreign
Labuan company requiring it to change its name, strike the company
from the register upon default in complying.

(3) No foreign Labuan company shall use, in Labuan or elsewhere,

in respect of acts done or to be done in Labuan, any name other than
that under which it is registered under this Part and every foreign
150 Laws of Malaysia ACT 441

Labuan company and every officer of the company who knowingly

authorizes or permits the default commits an offence under this Act.

Returns by foreign Labuan companies

129. (1) A foreign Labuan company shall make an annual return

containing the prescribed particulars and accompanied by such copies
of documents as are required to be included in the return, and shall
lodge the return with the Authority once in each calendar year not
later than thirty days prior to the anniversary of the date of its
registration.

(2) The Minister may make regulations —

(a) prescribing the registers and returns to be kept and made by

a foreign Labuan company and fixing the times within
which the same must be kept and made; and

(b) prescribing the fees and charges to be paid for the lodging
of any annual return.

Application of this Part to certain foreign companies registered

under Companies Act 2016

130. Notwithstanding any other provision in this Part, a foreign

company registered under the Companies Act 2016 and licensed
under the Financial Services Act 2013 and the Islamic Financial
Services Act 2013, as the case may be, may be registered under this
Part as a foreign Labuan company, and upon its registration the
provisions of this Part shall apply accordingly to the company.

PART VIIIA

COMPANY MANAGEMENT

130A. (Deleted by Act A1367).

 Labuan Companies 151

130B. (Deleted by Act A1367).

130C. (Deleted by Act A1367).

130D. (Deleted by Act A1367).

130E. (Deleted by Act A1367).

130F. (Deleted by Act A1367).

130G. (Deleted by Act A1367).

130H. (Deleted by Act A1367).

130I. (Deleted by Act A1367).

130J. (Deleted by Act A1367).

130K. (Deleted by Act A1367).

130L. (Deleted by Act A1367).

130M. (Deleted by Act A1367).

PART VIIIB

LABUAN PROTECTED CELL COMPANIES

Interpretation

130N. (1) In this Part, unless the context otherwise requires—

“cell” means a cell created by a Labuan protected cell company for

the purpose of segregating and protecting cell assets in the manner
provided under this Part;

“cell assets” means the assets of a Labuan protected cell company

attributable to the Labuan protected cell company’s cells;
152 Laws of Malaysia ACT 441

“cell capital” means the proceeds of the issue of cell shares;

“cell dividend” means the dividend paid by a Labuan protected cell

company in respect of cell shares;

“cell shares” means shares created and issued by a cell in a Labuan

protected cell company;

“Labuan protected cell company” means a Labuan company

incorporated as, or converted into, a protected cell company in
accordance with the provisions of this Part.

Labuan protected cell companies

130O. (1) Subject to the provisions of this Act—

(a) a Labuan company may be incorporated as a Labuan

protected cell company; and

(b) an existing Labuan company may, if authorized by its

articles and by special resolution, be converted into a
Labuan protected cell company.

(2) A Labuan protected cell company may establish one or more

cells for the purpose of segregating and protecting cell assets in the
manner provided by this Part.

(3) For the purposes of this Act, notwithstanding that a Labuan

protected cell company may create one or more cells pursuant to the
provisions of this Part, the Labuan protected cell company shall be a
single legal person, and the creation by the Labuan protected cell
company of a cell does not create, in respect of the cell, a legal
person separate from the Labuan protected cell company.

(4) No Labuan company or foreign Labuan company shall be

incorporated as, or converted into, or operate as a Labuan protected
cell company unless it is formed, and will operate for the sole
purpose of—
 Labuan Companies 153

(a) conducting Labuan insurance business or Labuan captive

insurance business on such terms as provided under the
Labuan Financial Services and Securities Act 2010 and
Labuan takaful business or Labuan captive takaful business
on such terms as provided under the Labuan Islamic
Financial Services and Securities Act 2010; or

(b) conducting the business of a mutual fund under the Labuan

Financial Services and Securities Act 2010 and the business
of an Islamic mutual fund under the Labuan Islamic
Financial Services and Securities Act 2010.

Approval of the Authority

130P. (1) A Labuan company shall not be incorporated as, or

operate as, or be converted into, a Labuan protected cell company
except in accordance with the terms and conditions of the written
approval of the Authority, which may prescribe classes or
descriptions of companies which may be Labuan protected cell
companies.

(2) The Authority may at any time and in such manner as it thinks
fit—

(a) vary or revoke any term or condition subject to which an

approval under subsection (1) was granted; and

(b) impose any new term or condition to any such approval.

(3) An application for approval of the Authority as required in

subsection (1) shall be —

(a) made in such form and shall be accompanied by such

documents and information, verified in such manner, as the
Authority may require; and

(b) accompanied by the prescribed fee.

154 Laws of Malaysia ACT 441

(4) The Authority may require an applicant under subsection (3) to

furnish it with such other documentation and information as it
considers necessary to determine the application.

Incorporation of, or conversion into, a Labuan protected cell

company

130Q. (1) The incorporation or conversion of a Labuan company or

a foreign Labuan company as a Labuan protected cell company shall
be made by filing the company’s memorandum and articles or
amended memorandum or articles under this Part, accompanied by—

(a) a certified copy of the approval of the Authority granted

under section 130P;

(b) all such documents and information as are required for the
registration or conversion of the memorandum and articles
of a Labuan company or foreign Labuan company as a
Labuan protected cell company required under this Act; and

(c) the prescribed fee.

Name and memorandum or articles of a Labuan protected cell

company

130R. (1) The name of a Labuan protected cell company shall,

without prejudice to the provisions of section 21 of this Act, include
the expressions “Protected Cell Company” or “PCC”.

(2) Each cell of a Labuan protected cell company shall have its
own distinct name or designation.

(3) The memorandum or articles of a Labuan protected cell

company shall state that it is a Labuan protected cell company.

(4) A Labuan protected cell company may, in order to comply

with subsection (3), alter its memorandum or articles by a special
 Labuan Companies 155

resolution, and the provisions of this Act relating to alteration of the

memorandum or articles shall apply.

(5) Unless and until a Labuan protected cell company has

complied with the provisions of this section, it shall not be deemed to
be a Labuan protected cell company for the purposes of this Part.

Cell and general assets

130S. (1) The assets of a Labuan protected cell company shall be

either—

(a) cell assets which comprise the assets of the Labuan

protected cell company held within or on behalf of the
protected cells of the company; or

(b) general assets which comprise the assets of the Labuan

protected cell company which are not cell assets.

(2) The assets of a protected cell comprise—

(a) assets representing the consideration paid or payable for the

issue of the protected cell shares and reserves attributable to
the protected cell; and

(b) all other assets attributable or held within the protected cell.

(3) A Labuan protected cell company shall—

(a) maintain separate records for cell assets and keep the cell
assets held for each cell separate from cell assets held for
other such cells and from general assets; and

(b) arrange proper protection of cell assets, both as between

cells and in respect of general assets, by way of segregation
and clear identification.
156 Laws of Malaysia ACT 441

(4) The duty imposed by subsection (3) is not breached by reason

only that the directors of a Labuan protected cell company—

(a) included the directors who are appointed to manage the

affairs of a particular cell or cells;

(b) has appointed a committee to undertake its duties in relation

to a particular cell or cells;

(c) has caused or permitted the cell assets or general assets, or a

combination of both, to be collectively invested or
collectively managed by an investment manager; or

(d) has caused or permitted the cell assets and general assets to
be held by or through a nominee or trustee:

Provided that the assets in question remain separately identifiable

according to subsection (3).

(5) In the event of a contravention of subsection (3)—

(a) each director and officer in contravention, as the case may

be, shall incur personal liability for any loss or damage as
consequence of the contravention; and

(b) each such director and officer shall severally have a right of
indemnity against the general assets of the Labuan protected
cell company, unless he was fraudulent, reckless, or acted in
bad faith.

Cell shares and cell share capital

130T. (1) A Labuan protected cell company may, in respect of any

of its cells, create and issue cell shares and the cell capital of which
shall be comprised in the cell assets attributable to the cell in respect
of which the shares were issued.
 Labuan Companies 157

(1A) Where a Labuan protected cell company makes any allotment

of its cell shares, the protected cell company shall, within thirty days,
lodge with the Authority the information of such allotment.

(2) The proceeds of the issue of shares other than cell shares
created and issued by a Labuan protected cell company shall be
comprised in the general assets of the Labuan protected cell
company.

(3) Cell dividend may be paid by a Labuan protected cell company

in respect of cell shares by reference only to the cell assets and
liabilities attributable to the cell in respect of which the cell shares
were issued.

(4) In determining the cell dividend, no account need to be taken

care of—

(a) the profit and losses, or the assets and liabilities, attributable
to any other cells of the Labuan protected cell company; or

(b) the non-cell profit and losses, or the assets and liabilities, of
the Labuan protected cell company.

(5) A Labuan protected cell company shall prepare a certificate of

title to cell shares, in respect of any new cell shares issued by,
transferred to or registered by it or to be replaced by it as a result of
being lost, stolen or damaged, and each certificate must state—

(a) the cell to which the cell shares relate;

(b) the number of cell shares, the title of which is evidenced by

the certificate;

(c) where the Labuan protected cell company has more than
one class of cell shares, the class of cell shares, the title to
which is evidenced by the certificate; and

(d) the name of the holder.

158 Laws of Malaysia ACT 441

Register of shareholders

130U. (1) Subject to section 105, every Labuan protected cell

company shall keep an index of the names of its shareholders, which
shall—

(a) contain, in relation to each shareholder, a sufficient

indication to enable the account of that shareholder to be
readily found;

(b) specify the particular cell or cells to which an account or

accounts of that shareholder relate;

(c) be readily searchable by reference to the account of the

shareholder or by reference to a cell;

(d) be kept at all times at the same place as the register of

shareholders; and

(e) be altered when any alteration is made to the register of

shareholders.

(2) The provisions of section 106 in respect of inspection of

register of shareholders shall apply to this Part.

Reduction of cell capital

130V. (1) The provisions of section 53 in respect of the reduction of

share capital of a Labuan company shall apply mutatis mutandis in
respect of the reduction of share capital of the general assets of a
Labuan protected cell company and the cell capital of the respective
cell assets of a Labuan protected cell company.

(2) A Labuan protected cell company shall not reduce the share
capital of its general assets to less than the cell capital of any cell
assets of the Labuan protected cell company.
 Labuan Companies 159

Rights of creditors

130W. (1) The rights of the creditors of a Labuan protected cell

company shall correspond with the liabilities provided for in this Part
and no such creditor of a Labuan protected cell company shall have
any rights other than the rights referred to in this Part.

(2) The following terms shall be implied in every transaction

entered into by a Labuan protected cell company:

(a) that no party shall, whether in any proceeding or by any

other means, use any cell assets attributable to any cell of
the Labuan protected cell company to satisfy a liability not
attributable to that cell;

(b) that if any party shall succeed by any means in using any
cell assets attributable to any cell of the Labuan protected
cell company to satisfy a liability not attributable to that
cell, that party shall be liable to the Labuan protected cell
company to pay a sum equal to the value of the benefit
thereby obtained by him; and

(c) that if any party shall succeed in seizing or attaching or

otherwise levying execution against any cell assets
attributable to any cell of the Labuan protected cell
company to satisfy a liability not attributable to that cell,
that party shall hold those assets or their proceeds in a
fiduciary capacity for the Labuan protected cell company
and shall keep those assets or proceeds separate and
identifiable for that purpose.

(3) All sums recovered by a Labuan protected cell company as a

result of any such obligation as is described in paragraph (2)(c) shall
be credited against any concurrent liability imposed under the implied
term set out in paragraph (2)(b).

(4) Any asset or sum recovered by a Labuan protected cell

company pursuant to the implied term set out in paragraph (2)(b) or
(c) or by any other means in the events referred to in those paragraphs
160 Laws of Malaysia ACT 441

shall, after the deduction or payment of any costs of recovery, be

applied by the Labuan protected cell company so as to compensate
the cell affected.

(5) In the event of any cell assets attributable to a cell of a Labuan

protected cell company being seized, attached, levied or otherwise
taken in execution in respect of a liability not attributable to that cell,
and in so far as such assets or compensation in respect thereof cannot
otherwise be restored to the cell affected, the Labuan protected cell
company shall—

(a) cause or procure its auditor, acting as an expert and not as

an arbitrator, to certify the value of the assets lost to the cell
affected; and

(b) transfer or pay to the cell affected, from the cell assets or
general assets to which the liability was attributable, assets
or sums sufficient to restore to the cell affected the value of
the assets lost.

(6) Where a Labuan protected cell company is obliged to make a

transfer or payment from cell assets attributable to a cell of the
Labuan protected cell company under paragraph (2)(b), and those
assets are insufficient, the protected cell company shall so far as
possible make up the deficiency from its general assets.

Liabilities

130X. (1) Where a liability arises which is attributable to a

particular cell of a Labuan protected cell company—

(a) the cell assets attributable to that cell shall be used to satisfy
the liability; and

(b) a creditor in respect of that cell shall not be entitled to have

recourse against the cell assets of any other cell or the
general assets of the Labuan protected cell company.
 Labuan Companies 161

(2) Where a liability arises which is not attributable to a particular

cell of a Labuan protected cell company—

(a) the liability shall be satisfied solely from the Labuan

protected cell company’s general assets; and

(b) a creditor in respect of that liability shall not be entitled to

have recourse to the cell assets of any cell of the Labuan
protected cell company.

(3) Without prejudice to the foregoing provisions—

(a) cell assets attributable to a particular cell of a Labuan

protected cell company—

(i) are available only to the creditors of the Labuan

protected cell company who are creditors in respect of
that cell and who are thereby entitled to have recourse
to the cell assets attributable to that cell; and

(ii) shall be absolutely protected from the shareholders of

the Labuan protected cell company and from the
creditors of the Labuan protected cell company who
are not creditors in respect of that cell and who
accordingly are not entitled to have recourse to the
cell assets attributable to that cell; and

(b) cell assets not attributable to a particular cell of a Labuan

protected cell company shall not be used to satisfy any
liability attributable to that cell.

(4) In the event of any dispute as to —

(a) whether any right is or is not in respect of a particular cell;

(b) whether a creditor is or is not a creditor in respect of a

particular cell;
162 Laws of Malaysia ACT 441

(c) whether a liability is or is not attributable to a particular

cell; or

(d) the amount to which any liability is limited,

the Court, on the application of the Labuan protected cell company or

of the creditor in dispute with the Labuan protected cell company,
and without prejudice to any other right or remedy of any person,
may issue a declaration in respect of the matter in dispute.

Disclosure

130Y. (1) A Labuan protected cell company shall—

(a) inform any person with whom it transacts that it is a Labuan

protected cell company;

(b) for the purposes of that transaction, identify or specify the

cell in respect of which that person is transacting, unless
that transaction is not a transaction in respect of a particular
cell; and

(c) where the transaction is in respect of a particular cell,

inform the person that the cell assets of that cell, and only
those assets, are available to pay the obligations and
liabilities of that cell.

(2) If, in contravention of subsection (1), a Labuan protected cell

company—

(a) fails to inform a person that he is transacting with a Labuan

protected cell company, and that person is otherwise
unaware that, and has no reasonable grounds to believe that,
he is transacting with a Labuan protected cell company;

(b) fails to identify or specify the cell in respect of which a

person is transacting, and that person is otherwise unaware
 Labuan Companies 163

of, and has no reasonable basis of knowing, which cell he is

transacting with; or

(c) fails to inform a person that the cell assets of that cell, and
only those assets, are available to pay the obligations and
liabilities of that cell,

then, in any such case, the directors shall incur personal liability to
that person in respect of the transaction, and each director shall
severally have a right of indemnity against the general assets of the
Labuan protected cell company unless he was fraudulent, reckless or
negligent, or acted in bad faith.

(3) Notwithstanding the foregoing subsections, the Court may

relieve a director or officer, as the case may be, of all or part of his
personal liability thereunder if he satisfies the Court that he ought
fairly to be so relieved because —

(a) he was not aware of the circumstances giving rise to his

liability and, in being not so aware, he was neither
fraudulent, reckless or negligent, nor acted in bad faith; or

(b) he expressly objected, and exercised such rights as he had

as such a director or officer, whether by way of voting
power or otherwise, so as to try to prevent the
circumstances giving rise to his liability.

(4) Where the Court relieves a director or officer of all or part of

his personal liability under subsection (3), the Court may order that
the liability in question shall instead be met from—

(a) the assets of the relevant cell in respect of which the person
was dealing or transacting; or

(b) the general assets of the Labuan protected cell company,

as may be specified in the order.

164 Laws of Malaysia ACT 441

(5) Any provision in the articles of a Labuan protected cell

company or any other contractual provision under which the Labuan
protected cell company may be liable which purports to —

(a) avoid the incurring of personal liability upon a director or

officer in the circumstances described in this section; or

(b) indemnify directors or officers in respect of conduct which

would otherwise disentitle them to an indemnity against
non-cell assets by virtue of this section,

shall be void.

Dealings and transactions between cell assets

130Z. A Labuan protected cell company may—

(a) transfer a cell asset attributable to a cell of the Labuan

protected cell company to another cell of the Labuan
protected cell company; or

(b) amalgamate or consolidate a cell of the Labuan protected

cell company with, or into, one or more other cells of the
Labuan protected cell company:

Provided that the Authority has given its written consent when it is
satisfied that—

(i) the creditors of the Labuan protected cell company

entitled to have recourse to the cell assets attributable
to the cell have consented to the transfer,
amalgamation or consolidation, as the case may be, or
otherwise would not be unfairly prejudiced; and

(ii) the shareholders of the Labuan protected cell

company and of each relevant cell consent to the
transfer, amalgamation or consolidation, as the case
 Labuan Companies 165

may be, or otherwise would not be unfairly

prejudiced.

Transfer of cell assets

130ZA. (1) Subject to the provisions of this section, a Labuan

protected cell company may transfer cell assets attributable to any
cell of the Labuan protected cell company, but not the general assets
of the Labuan protected cell company, to another person, whether
resident or incorporated, and whether or not a Labuan protected cell
company.

(2) No transfer in subsection (1) may be made except where it was

made under the authority of a special resolution of the shareholders
made on the recommendation of a directors’ resolution:

Provided that the directors shall not make a recommendation in

relation to a cell in a Labuan protected cell company unless they are
satisfied that—

(a) the creditors of the Labuan protected cell company entitled

to have recourse to the cell assets attributable to the cell
have consented to the transfer; or

(b) those creditors would not be unfairly prejudiced by the

transfer; and

(c) the Authority has given its prior consent to the transfer.

(3) The Authority may attach such conditions as it thinks fit to a

consent given under paragraph (2)(c), including conditions as to the
discharging of claims of creditors entitled to have recourse to the cell
assets attributable to the cell in relation to which the consent is
sought.

(4) The Authority may consent to a transfer of cell assets

notwithstanding that—
166 Laws of Malaysia ACT 441

(a) an approved liquidator has been appointed to act in respect

of the Labuan protected cell company or the Labuan
protected cell company has passed a resolution for
voluntary winding up;

(b) a receivership order has been made in respect of the cell, the
Labuan protected cell company or any other cell of the
Labuan protected cell company; or

(c) an administration order has been made in respect of the cell,

the Labuan protected cell company or any other cell thereof.

(5) The provisions of this section are without prejudice to the

power of a Labuan protected cell company lawfully to make
payments or transfers from the cell assets attributable to any cell of
the Labuan protected cell company to a person entitled, in conformity
with the provisions of this Part, to have recourse to those cell assets.

(6) This section shall not apply to the transfer of cell assets
attributable to any cell of a Labuan protected cell company in the
ordinary course of business of the Labuan protected cell company
through payments, investments or otherwise.

Receivership and winding up of Labuan protected cell company

and cell liquidation

130ZB. (1) Notwithstanding any written law or rule of law to the

contrary, in the receivership and winding up of a Labuan protected
cell company or any cell of a Labuan protected cell company, the
approved liquidator—

(a) shall be bound to deal with the general assets of the Labuan
protected cell company or the cell assets of each cell of the
Labuan protected cell company in accordance with the
requirements set out in subsection 130S(3); and

(b) in the discharge of the claims of creditors of the Labuan

protected cell company or of each cell of the Labuan
 Labuan Companies 167

protected cell company, shall apply the assets of the

protected cell company to those entitled to have recourse
thereto in conformity with the provisions of this Part.

(2) The provisions relating to the distribution of property on

receivership and winding up shall apply to the protected cell
company, subject to such modifications as may be necessary to bring
them in conformity with this Part.

Application of this Act

130ZC. For the avoidance of doubt, all the provisions of this Act
relating to a Labuan company shall apply to a Labuan protected cell
company, and where the context permits or requires, shall apply with
the necessary modifications to a cell of a Labuan protected cell
company.

PART IX

RECEIVERSHIP AND WINDING UP

Receivership and winding up

131. (1) The provisions of Subdivision 3 of Division 7 of Part III

and Division 1 and Division 2 of Part IV of the Companies Act 2016
shall apply to the receivership and winding up of a Labuan company,
subject to such modifications and adaptations as may be necessary,
and in particular references to a “company” shall be taken as
references to a Labuan company.

(2) The Companies (Winding Up) Rules 1972 [P.U. (A) 289/1972]
shall also apply to the winding up of a Labuan company, subject to
such modifications and adaptations as may be necessary, and in
particular references to a ‘company’ shall be taken as references to a
Labuan company.
168 Laws of Malaysia ACT 441

(3) A liquidator appointed under the provisions of this Part shall

be an approved liquidator as required by subsection 12(1).

Alternative procedure for voluntary winding up of solvent

Labuan companies

131A. (1) Where a Labuan company has ceased to operate and has
discharged all its debts and liabilities, any officer or member of the
Labuan company may, after giving notice in accordance with
subsection (3), apply to the Authority for a declaration of dissolution
of the Labuan company.

(2) An application for a declaration of dissolution under

subsection (1) shall be in writing and shall be accompanied by—

(a) a statutory declaration made by a director or member of the

Labuan company stating —

(i) that the Labuan company has ceased to operate and

has discharged all its debts and liabilities (other than
those owed to its members); and

(ii) that the notice required by subsection (3) has been

given in accordance with that subsection and the date
the last of such notice was published or posted, as the
case may be;

(b) a copy of the notice given under subsection (3); and

(c) a written notice from the Inland Revenue Board that it has
no objection to the Authority making a declaration of
dissolution of the Labuan company.

(3) Before making an application to the Authority under this

section, the applicant shall ensure that a notice to the effect that the
applicant proposes to apply to the Authority for a declaration of
dissolution of the Labuan company and that the Authority may
 Labuan Companies 169

dissolve the Labuan company unless written objection is made to the

Authority within thirty days from the date the notice was posted—

(a) has been published in at least one newspaper widely

circulated in Malaysia and one international financial
newspaper in an advertisement; and

(b) has been sent by registered post to each director and to each
member of the Labuan company at the last known address
of which the Labuan company has notice.

(4) The Authority shall not make a declaration of dissolution of a

Labuan company earlier than thirty days after the date of publication
or posting, as the case may be, of the last notice published or posted
for the purposes of subsection (3).

(5) On receipt of any written objection to the dissolution of the

Labuan company, the Authority shall forthwith notify the applicant
for the declaration of dissolution of the receipt of the objection and of
the identity of the objector.

(6) Where a director, member or creditor of a Labuan company

has objected to the dissolution of the Labuan company, the Authority
shall not declare the dissolution of the Labuan company unless—

(a) the director, member or creditor, as the case may be,

withdraws the objection; or

(b) the Authority decides that the objection is completely

without justification and the objector has not appealed to the
Court against the Authority’s decision within twenty-one
days of the date on which he is notified of the decision, and
the Court has upheld the Authority’s decision.

(7) If the Authority is not prohibited from declaring the dissolution

of a Labuan company pursuant to this section and agrees to the
dissolution, it shall notify the Labuan company that, subject to the
Labuan company’s memorandum and articles of association, it is
170 Laws of Malaysia ACT 441

entitled to distribute its surplus assets among its members according

to their respective rights and interests.

(8) The Labuan company shall notify the Authority that its surplus
assets have been distributed in accordance with subsection (7).

(9) On receipt of notification from a Labuan company that its

surplus assets have been distributed in accordance with subsection
(7), the Authority may, by publication in one newspaper widely
circulated in Malaysia and one international financial newspaper,
declare that the Labuan company is dissolved and, on the publication
in the Gazette of the notice, the Labuan company shall be dissolved:

Provided that the liability, if any, of every officer and member of

the Labuan company shall continue and may be enforced as if the
Labuan company had not been dissolved.

(10) Where a Labuan company has been dissolved pursuant to this

section, the Court, on an application made by the Authority or of any
other person who appears to the Court to be interested, before the
expiration of six years from the publication of the notice of
dissolution, may, if satisfied that at the time of dissolution of the
Labuan company it was in operation or had not discharged all its
debts and liabilities or otherwise that it is just that the dissolution of
the Labuan company be revoked, order that the dissolution of the
Labuan company be revoked and upon a sealed copy of the order
being delivered to the Authority for registration, the Labuan company
shall be deemed to have continued in existence as if it had not been
dissolved; and the Court may by the order give such directions and
make such provision as it deems just.
 Labuan Companies 171

PART X

MISCELLANEOUS

Service of documents on companies

132. Any document served under this Act shall be deemed to have
been served on a Labuan company or foreign Labuan company if the
document—

(a) is left, or sent by ordinary or registered post to it’s last-

known registered office or registered principal place of
business of the company; or

(b) is sent by electronic means to the address or numbers

provided by the Labuan company or foreign Labuan
company.

Transfer from Labuan

133. (1) A Labuan company may, upon obtaining the approval of

the Authority and within two months from the date on which the
approval is obtained, apply to the proper officer of another country or
of a jurisdiction within such a country, by the laws of which such
transfer is authorized, for an instrument transferring a company as if
it had been incorporated under the laws of that other country or
jurisdiction, and on the date of the instrument of transfer, the
company shall, subject to the provisions of this section, become a
company under the laws of that country or jurisdiction and be
domiciled therein.

(2) A Labuan company shall not apply to the Authority for

approval under subsection (1) unless—

(a) the application is authorized—

172 Laws of Malaysia ACT 441

(i) where the company has a share capital, by the holders

of not less than three-fourths of the shares of each
class;

(ii) by the holders of not less than three-fourths of the

company’s debentures (if any) of each class; and

(iii) by all the directors of the company; and

(b) the company, not less than thirty days before applying to the
Authority for such approval, has published a notice in a
newspaper circulating generally in Labuan of its intention to
make the application,

and an application shall not be accepted unless it is accompanied with

an affidavit sworn by a director of the company in which are set
out—

(c) the names and addresses of its creditors and the total
amount of its indebtedness to creditors; and

(d) a statement to the effect that the proposed transfer of

domicile is unlikely to be detrimental to the rights or proper
interests of any of the company’s members, debenture
holders or creditors.

(3) The Authority shall not give its approval to a Labuan company
applying for transfer to another country or jurisdiction unless the
Authority is satisfied that —

(a) the requirements of subsection (2) have been complied with;

and

(b) the company has complied with the provisions of this Act
which it should have complied with,

and the Authority may grant its approval on such conditions as it

thinks necessary to safeguard the rights and proper interests of a
member, debenture holder or creditor of the company or a class of
 Labuan Companies 173

such members, debenture holders or creditors and upon the company

taking such steps as the Authority considers necessary to remedy any
failure to comply with any provision of this Act.

(4) Upon an instrument transferring the company to another

country or jurisdiction being executed by the proper officer of that
other country or jurisdiction, the company shall forthwith notify the
Authority the details and the company shall be deemed to have
ceased to be a company incorporated in Labuan from the date of its
transfer to that other country or jurisdiction takes effect and the
Authority shall remove its name from the register:

Provided that nothing in this subsection shall take away or affect

the jurisdiction of any court to hear and determine any proceedings
commenced therein by or against the company before it ceased to be
a company incorporated in Labuan.

(5) Where a Labuan company notifies the Authority under

subsection (4) that an instrument transferring the company to another
country or jurisdiction has been executed by the proper officer of that
other country or jurisdiction and that notification is false, then,
notwithstanding that the Authority has removed the name of the
company from the register in pursuance of that subsection —

(a) the liability (if any) of any officer or member of the

company shall continue and may be enforced as if the
company were still registered under this Act; and

(b) the company shall be liable to be wound up pursuant to the

provisions of this Act as if it were still registered under this
Act.

Costs of proceedings before the Court

134. In respect of any proceedings before the court under this Act,
the court may, at its own discretion, direct that the costs of one party
be paid in such amount and by such other party as it thinks just.
174 Laws of Malaysia ACT 441

Security for costs

135. Where a Labuan company is a plaintiff in any court action or

other legal proceedings, the court may, at any time, require sufficient
security to be given for costs and stay all proceedings until the
security is given.

Disposal of shares of shareholder whose whereabouts are

unknown

136. (1) Where after exercising reasonable diligence a Labuan

company is unable to discover the whereabouts of a registered
shareholder for a period of not less than ten years, the company may
cause a notice to be published in a daily newspaper circulating in the
place shown in the register of members as the address of the
shareholder stating that the shares, after the expiration of one month
from the date of the notice, will be liable to be forfeited to the
Authority.

(2) If after the expiration of one month from the date of a notice
under subsection (1) the whereabouts of a shareholder remain
unknown, the company may transfer the shares held by the
shareholder in the company to the Authority and for that purpose may
execute for and on behalf of the owner a transfer of those shares to
the Authority; and the person whose shares have been forfeited shall
cease to be a member in respect of the forfeited shares, but shall,
notwithstanding the forfeiture, remain liable to pay to the company
all moneys which, at the date of forfeiture, were payable by him to
the company in respect of the shares, but his liability shall cease if
and when the company receives payment in full of all such moneys in
respect of the shares.

Power to grant relief

137. (1) In any proceedings for negligence, default, breach of duty

or breach of trust against a person to whom this section applies, if it
appears to the Court before which the proceedings are taken that he is
 Labuan Companies 175

or may be liable in respect thereof but that he has acted honestly and
reasonably and that, having regard to all the circumstances of the case
including those connected with his appointment, he ought fairly to be
excused for the negligence, default or breach, the Court may relieve
him either wholly or partly from his liability on such terms as the
Court thinks fit.

(2) Where any person to whom this section applies has reason to
apprehend that any claim will or might be made against him in
respect of any negligence, default, breach of duty or breach of trust,
he may apply to the Court for relief, and the Court shall have the
same power to relieve him under this section as it would have had if
it had been a Court before which proceedings against him for the
negligence, default, breach of duty or breach of trust had been
brought.

(3) The persons to whom this section applies are —

(a) officers of a Labuan company;

(b) persons employed by a Labuan company as auditors,

whether or not they are officers of the company;

(c) experts within the meaning of this Act; and

(d) all persons, including receivers and managers or approved

liquidators, who are appointed or directed by the Court or
the Authority to carry out any duty under this Act in relation
to a Labuan company.

Injunctions

137A. (1) Where a person has engaged, is engaging or intends to

engage in conduct that constituted, constitutes or would constitute—

(a) a contravention of this Act;

(b) an attempt to contravene this Act;

176 Laws of Malaysia ACT 441

(c) an attempt that aids, abets, advises or procures a person to

contravene this Act;

(d) an attempt to induce, whether by threats, promises or

otherwise, a person to contravene this Act;

(e) an attempt by which any person would be in any way,

directly or indirectly, knowingly concerned in, or party to,
the contravention by a person of this Act; or

(f) an attempt of conspiracy with others to contravene this Act,

the Court may, on the application of the Authority, or of a person

whose interests have been, are or would be affected by the conduct,
grant an injunction, on such terms as the Court thinks appropriate,
restraining the first-mentioned person from engaging in the conduct
and, if in the opinion of the Court it is desirable to do so, requiring
that person to do any act or thing.

(2) Where a person fails or refuses to do an act or thing that the

person is required by this Act to do, the Court may, on the application
of the Authority or any person whose interests have been, are or
would be affected by the failure or refusal of the person to do that act
or thing, grant an injunction, on such terms as the Court thinks
appropriate, requiring the first-mentioned person to do that act or
thing.

(3) The power of the Court to grant an injunction restraining a

person from engaging in that conduct may be exercised whether or
not—

(a) it appears to the Court that the person intends to engage

again or to continue to engage, in conduct of that kind;

(b) the person has previously engaged in conduct of that kind;

or
 Labuan Companies 177

(c) there is an imminent danger of substantial damage to any

person if the first-mentioned person engages in conduct of
that kind.

(4) The power of the Court to grant an injunction requiring a

person to do an act or thing may be exercised whether or not—

(a) it appears to the Court that the person intends to refuse or

fail again, or to continue to refuse or fail, to do that act or
thing;

(b) the person has previously refused or failed to do that act or

thing; or

(c) there is an imminent danger of substantial damage to any

person if the first-mentioned person refuses or fails to do
that act or thing.

(5) Where the Authority applies to the Court for the grant of an
injunction under this section, the Court shall not require the applicant
or any other person, as a condition of granting an interim injunction,
to give an undertaking as to damages.

(6) Where an application for an injunction under subsection (1) or

(2) has been made, the Court may, if the Court determines it to be
appropriate, grant an injunction by consent of all parties to the
proceedings, whether or not the Court is satisfied that that subsection
applies.

(7) Where in the opinion of the Court it is desirable to do so, the

Court may grant an interim injunction pending determination of an
application under subsection (1).

(8) The Court may revoke or vary an injunction granted under

subsection (1), (2) or (7).

(9) In granting an injunction restraining a person from engaging in

particular conduct, or requiring a person to do a particular act or
thing, the Court may, either in addition to or in substitution for the
178 Laws of Malaysia ACT 441

grant of the injunction, order that person to pay damages to any other
person.

Irregularities in proceedings

138. (1) No proceedings under this Act shall be invalidated by any

omission, defect, error, irregularity or deficiency of notice or time
unless the Court is of the opinion that substantial injustice has been or
may be caused thereby which cannot be remedied by any order of the
Court and the Court may, if it thinks fit, make an order or direction
declaring that such proceedings are valid notwithstanding any such
omission, defect, error, irregularity or deficiency.

(2) Without affecting the generality of subsection (1) or of any

other provisions of this Act, where any omission, defect, error,
irregularity or deficiency, including the absence of a quorum at any
meeting of the Labuan company, has occurred in the management or
administration of a Labuan company whereby any breach of the
provisions of this Act has occurred, or whereby there has been default
in the observance of the memorandum or articles of the company or
whereby any proceedings at or in connection with any meeting or
purported meeting have been rendered ineffective, including the
failure to make or lodge any declaration of solvency, the Court—

(a) may, either of its own motion or on an application lodged

by any interested person, make such order or direction as it
thinks fit to rectify or cause to be rectified or to negative or
modify or cause to be negatived or modified the
consequences in law of any such omission, defect, error,
irregularity or deficiency, or to validate any act, matter or
thing rendered invalid by or as a result of any such
omission, defect, error, irregularity or deficiency;

(b) shall, before making any such order or direction, satisfy

itself that such an order or direction would not do injustice
to the company or to any member or creditor thereof, or any
other person;
 Labuan Companies 179

(c) where any such order or direction is made, may give such
ancillary or consequential directions as it thinks fit; and

(d) may determine what notice or summons is to be given to

other persons of the intention to make any such application
or of the intention to make such an order or direction and
whether it should be advertised in any newspaper.

(3) For the purposes of subsection (2), “meeting”, in relation to a

Labuan company, includes—

(a) a meeting of the company;

(b) a meeting of any class of members of the company;

(c) a meeting of the debenture holders or any class of debenture

holders of the company;

(d) a meeting of the directors of the company or of any

committee of the directors; and

(e) a meeting of the creditors or any class of the creditors of the

company.

(4) The Court, whether the company is in the process of being

wound up or not, may extend or shorten any time for doing any act or
taking any proceedings allowed or limited by this Act or the
regulations on such terms, if any, as the justice of the case may
require, and any such extension may be ordered although the
application for the same is not made until after the time originally
allowed or limited.

Translation of instruments

139. (1) Where under this Act a Labuan company or a foreign

Labuan company or a foreign company is required to lodge with the
Authority an instrument, certificate, contract or document or a
certified copy thereof and the same is not written in the national
180 Laws of Malaysia ACT 441

language or in the English language, the company shall lodge at the

same time with the Authority a certified translation thereof in the
national language or in the English language.

(2) Where under this Act a Labuan company or a foreign Labuan

company is required to make available for public inspection any
instrument, certificate, contract or document and the same is not
written in the national language or in the English language, the
company shall keep at its registered office in Labuan a certified
translation thereof in the national language or in the English
language.

(3) Where any accounts, minute books or other records of a

Labuan company or a foreign Labuan company required to be kept by
this Act are not kept in the national language or in the English
language, the directors of the company shall cause a true translation
in the national language or in the English language of such accounts,
minute books and other records to be made from time to time at
intervals of not more than seven days and shall cause such
translations to be kept with the original accounts, minute books and
other records for so long as the original accounts, minute books and
other records are required to be kept by this Act.

Dividends payable from profits only

140. No dividend shall be payable to any shareholder of any Labuan

company except out of profits.

Use of word “Corporation”, etc.

141. Every person who carries on business in Labuan under any

name or title which incorporates the word or words “Berhad”,
“Corporation”, “Incorporated”, “Limited”, “Societe Anonyme”,
“Sociedad Anonima”, “Aktiengesellschaft”, “Naamloze Vennootschap”
or “Perseroan Terbatas” or any other word or words in the national
language of any country which connotes a joint stock company
limited by shares or guarantee or an unlimited company, or any
 Labuan Companies 181

abbreviation of those words, unless it is a Labuan company or foreign

Labuan company duly created, incorporated or registered under this
Act, or a domestic company or incorporated body, commits an
offence under this Act.

Penalties

142. (1) Subject to section 142A, a person who—

(a) does that which by or under this Act he is forbidden to do;

(b) does not do that which by or under this Act he is required or

directed to do; or

(c) contravenes or fails to comply with any provision of this

Act,

commits an offence under this Act.

(2) A person who is guilty of an offence against this Act shall be

liable on conviction to a penalty or punishment expressly mentioned
as the penalty or punishment for the offence, or if a penalty or
punishment is not so mentioned, to a penalty not exceeding
*fifty thousand ringgit.

(3) The penalty or punishment, pecuniary or otherwise, set out in,

or at the foot of, any section or part of a section of this Act, shall
indicate that the offence is punishable upon conviction by a penalty
or punishment not exceeding that so set out, and where the penalty or
punishment is expressed to apply to a part only of the section, it shall
apply to that part only.

(4) Where in, or at the foot of, any section or part of a section of
this Act there appears the expression “Default penalty”, it shall
indicate that a person who is convicted of an offence against this Act

*NOTE—Previously “ten”—see subsection 52(a) of the Labuan Companies (Amendment) Act 2022
[Act A1653].
182 Laws of Malaysia ACT 441

in relation to that section or part commits a further offence under this

Act if the offence continues after he is so convicted and liable to an
additional penalty for each day during which the offence so continues
of not more than the amount expressed in the section or part as the
amount of the default penalty or, if an amount is not so expressed, of
not more than one thousand ringgit.

(5) Where the offence is committed by a person by reason of his

failure to comply with any provision of this Act under which he is
required or directed to do anything within a particular period, that
offence, for the purposes of subsection (1), shall be deemed to
continue so long as the thing required or directed to be done by him
remains undone, notwithstanding that the period had elapsed.

(6) For the purposes of any provisions of this Act which provides
that an officer of a Labuan company or a foreign Labuan company
which is in default of an offence against this Act or is liable to a
penalty or punishment, the expression “officer who is in default” or
any like phrase means an officer of the company who knowingly and
willfully—

(a) is guilty of the offence; or

(b) authorizes or permits the commission of the offence.

Power to impose administrative penalties

142A. (1) The Authority may impose an administrative penalty on

any person who fails to comply with any provision of this Act.

(2) The Authority shall, before making a decision to impose an

administrative penalty on a person, serve on him a written notice
calling on him to show cause why the administrative penalty should
not be imposed upon him.

(3) If a satisfactory explanation is not received within such period

as may be specified in the written notice, the Authority may impose
an administrative penalty in an amount not exceeding five hundred
 Labuan Companies 183

ringgit for each day of non-compliance and such amount shall not in
total exceed the sum of *fifty thousand ringgit.

(4) Where a person has failed to pay an administrative penalty

imposed by the Authority under subsection (3), the penalty imposed
by the Authority may be sued for and recovered as a debt due to the
Authority.

143. (Deleted by Act A1367).

Compounding of offences

144. (1) The Authority may, with the written consent of the Public
Prosecutor, compound any offence committed by any person under
this Act by making a written offer to such person to compound the
offence upon payment to the Authority, within such time as may be
specified in the offer, such amount not exceeding fifty per centum of
the amount of the maximum fine for that offence.

(2) An offer under subsection (1) may be made at any time after
the offence has been committed, but before any prosecution for it has
been instituted.

(3) Where the amount specified in the offer is not paid within the
time specified in the offer, or within such extended period as the
Authority may grant, prosecution for the offence may be instituted at
any time thereafter against the person to whom the offer was made.

(4) Where an offence has been compounded under subsection (1),

no prosecution shall thereafter be instituted in respect of such offence
against the person to whom the offer to compound was made.

(5) Any money received by the Authority under this section shall
be paid into and form part of the fund established under section 29 of
the Labuan Financial Services Authority Act 1996.

*NOTE—Previously “ten”—see subsection 53 of the Labuan Companies (Amendment) Act 2022

[Act A1653].
184 Laws of Malaysia ACT 441

Procedure where none laid down

145. In the event that any act or step is required or permitted to be

done or taken under this Act and no form is prescribed or procedure
laid down either in this Act or the regulations, application may be
made to the Authority for directions as to the manner in which the
same may be done or taken, and any act or step done or taken in
accordance with its directions shall be a valid performance of such
act or step.

Power of the Minister to make regulations

146. (1) The Minister may, on the recommendation of the

Authority, make regulations prescribing all matters and things
required or authorized by this Act to be prescribed or provided, or
which are necessary or convenient to be prescribed or provided, for
the carrying out of, or giving full effect to, the provisions of this Act.

(2) Regulations made under this section may provide for—

(a) any act or omission in contravention of the regulations to be

an offence; and

(b) the imposition of penalties of a fine not exceeding twenty-

five thousand ringgit or to imprisonment for a term not
exceeding three years or to both.

147. (Deleted by Act A1367).

Prohibition by Minister

148. (1) The Minister may, without assigning reasons therefore,

issue, by notification in writing, a Minister direction—

(a) prohibiting the initial incorporation of any Labuan company

or class of companies;
 Labuan Companies 185

(b) prohibiting the initial registration of a foreign Labuan

company; or

(c) directing any Labuan company or foreign Labuan company

to cease to carry on its business or part of its business either
immediately or within such time as may be specified in the
direction.

(2) A direction made under this section may be revoked or varied

by the Minister.

Secrecy

149. (1) No person who has by any means access to any record,
book, register, correspondence, document, material or information
relating to the business and affairs of the Labuan company or foreign
Labuan company shall give, reveal, publish or otherwise disclose to
any person such record, book, register, correspondence, document,
material or information.

(2) All proceeding, other than criminal proceeding, relating to a

Labuan company or foreign Labuan company shall be commenced in
any Court, either under the provisions of this Act or for determining
the rights or obligations of officers, members or debenture holders.

(3) Such proceeding and any appeal therefrom shall, unless the
Court otherwise orders, be heard in camera and no details of the
proceeding shall be published by any person without leave of the
Court.

(4) The provisions of subsection (1) shall not apply—

(a) when lawfully required to make such disclosure by any

Court or under the provisions of any law being enforced by
the Authority;
186 Laws of Malaysia ACT 441

(b) for the purpose of the performance of the Authority’s

supervisory functions as may be provided for under any
written law;

(c) when lawfully required pursuant to section 22 of the Labuan

Business Activity Tax Act 1990 [Act 445]; or

(d) when duly authorized by the Labuan company or the

foreign Labuan company.

(5) A person who contravenes subsection (1) commits an offence

under this Act.

Penalty: Imprisonment for three years or one million ringgit or

both.

(6) Nothing in this section shall prevent any Court from exercising
its discretion to require a person to produce any document or to give
any evidence in any proceeding before the Court which is relevant to
those proceedings.

Power of the Minister to grant exemptions

150. The Minister may, on the recommendation of the Authority, on

an application in writing, exempt any Labuan company or foreign
Labuan company or any person or class of persons or class of Labuan
companies or foreign Labuan companies from any of the provisions
of this Act and may, in granting such exemption, impose such terms
and conditions as the Minister thinks fit.

Annual fee

151. (1) A Labuan company shall pay such annual fee as may be
prescribed, on or before the anniversary of the date of its
incorporation or establishment and in the event a Labuan company is
wound up prior to its first anniversary, the Labuan company shall pay
 Labuan Companies 187

the annual fee proportionately to the number of months, weeks and

days the Labuan company was in existence for that year.

(1A) The Authority may impose an administrative penalty on

payment of any annual fees received later than the anniversary date as
specified in subsection (1).

(2) Notwithstanding subsection (1A), if a Labuan company fails to

pay the annual fee referred to in subsection (1) on or before the
expiration of a period of six months from the annual fee payment date
then there shall be payable in addition to the annual fee an amount
equivalent to fifty per cent of the annual fee.

(3) (Deleted by Act A1653).

(4) (Deleted by Act A1653).

(5) Notwithstanding that the name of a Labuan company has been

struck off the register under section 151BB, the Labuan company shall
remain liable for all claims, debts, liabilities and obligations of the
Labuan company, and the striking off shall not affect the liability of
any of its members, directors, officers or agents under this Act or any
other law.

(6) The striking off of the name of a Labuan company from the
register under section 151BB shall not be affected by any failure on
the part of the Authority to serve a notice on the company secretary
or to publish a notice in accordance with subsection 151BB(4).

(7) Subsections (2) and (5) and section 151BB do not apply to
Labuan company in the process of being wound up and dissolved.

Company struck off liable for fees, etc.

151A. A Labuan company incorporated under this Act shall continue to

be liable for all fees, licence fees and penalties payable under this Act,
including the additional amount specified in subsection 151(2),
notwithstanding that the name of the Labuan company has been struck
188 Laws of Malaysia ACT 441

off the register; and such fees, licence fees and penalties shall have
priority over all other claims against the assets of the Labuan company.

Fees payable to Authority

151B. The Authority may refuse to take any action required of him
under this Act for which a fee is prescribed until all fees have been
paid.

Power of Authority to strike off Labuan company

151BA. Notwithstanding any provision in this Act, the Authority

may strike a Labuan company off the register, if the Labuan
company—

(a) fails to pay its annual fees or any additional amount in

addition to the annual fee within the time specified pursuant
to section 151;

(b) fails to appoint a replacement resident secretary after the

resignation of the former resident secretary pursuant to
subsection 93(2C);

(c) contravenes any provision of this Act and any other law
relating to Labuan financial services;

(d) being a licensed entity under the Labuan Financial Services

and Securities Act 2010 or Labuan Islamic Financial
Services and Securities Act 2010, has its licence, approval
or registration surrendered or revoked by the Authority; or

(e) is not carrying on any business or is not in operation.

Notice of intention to strike off Labuan company

151BB. (1) Before the name of a Labuan company can be struck off
the register under section 151BA, the Authority shall send a notice to
 Labuan Companies 189

the Labuan company stating that if an answer showing cause to the

contrary is not received the name of the Labuan company shall be
struck from the register within thirty days from the date of the notice
or any extended period as may be approved by the Authority.

(2) After the expiration of the period specified in the notice under
subsection (1) or any extended period, unless the Labuan company
has given reasons to the satisfaction of the Authority, the Authority
may strike the name of the Labuan company off the register.

(3) The notice under this section shall be deemed to be served on

the Labuan company if the notice—

(a) is left, or sent by ordinary or registered post to it’s last-

known registered office or registered principal place of
business of the company; or

(b) is sent by electronic means to the address or numbers

provided by the Labuan company.

(4) The Authority may publish in such form and manner a notice
of striking a Labuan company off the Register.

(5) For the purposes of paragraph 151BA(d), where after a licence,

approval or registration of the Labuan company has been surrendered
or revoked by the Authority, if the company wishes to continue as a
Labuan company, the Labuan company shall change its name and
memorandum within thirty days after such surrender or revocation of
licence, approval or registration, or in the event that such Labuan
company intends to continue to use its name and memorandum, the
Labuan company may apply to the Authority for approval.

(6) This section shall not apply to striking off under

subsection 93(2C).
190 Laws of Malaysia ACT 441

Effect of striking off

151C. (1) Where the name of a Labuan company has been struck
off the register, the Labuan company, and the directors, members,
approved liquidators and receivers thereof, shall not—

(a) commence any legal proceedings, carry on any business or

in any way deal with the assets of the Labuan company;

(b) defend any legal proceedings, make any claim or claim any
right for, or in the name of, the Labuan company;

(c) act in any way with respect to the affairs of the Labuan
company; or

(d) incur any new liability.

(2) Notwithstanding subsection (1), where the name of the Labuan

company has been struck off the register, the a Labuan company, or a
director, member, approved liquidator or receiver thereof, may—

(a) apply to the Authority for the Labuan company to be

registered afresh;

(b) continue to defend proceedings that were commenced

against the Labuan company prior to the date of the striking
off; and

(c) continue to carry on legal proceedings that were instituted

on behalf of the Labuan company prior to the date of
striking off.

(3) The fact that the name of a Labuan company has been struck
off the register does not prevent—

(a) (Deleted by Act A1653).

 Labuan Companies 191

(b) any creditor from making a claim against the Labuan

company and pursuing the claim through to judgment or
execution; or

(c) the appointment by the Court of an approved liquidator for

the Labuan company under Subdivision 3 of Division 7 of
Part III and Division 1 and Division 2 of Part IV (in so far
as they relate to a Labuan company limited by shares) of the
Companies Act 2016.

Dissolution of a Labuan company

151D. (1) If the name of a Labuan company has been struck off the
register under section 151 or section 151BA and remains struck off
continuously for a period of one year and six months, the Labuan
company shall be deemed to have been dissolved, but the Authority
may apply to the Court on or before the expiration of the period of
one year and six months to have the company put into liquidation and
a person appointed by the Court shall be the approved liquidator of
the Labuan company.

(2) Where a Labuan company has been dissolved pursuant to

subsection (1), the Court may, at any time within six years after the
date of dissolution, on an application of any person who appears to
the Court to have locus standi and legitimate interest in the Labuan
company, if the Court is satisfied that at the time of the dissolution of
the Labuan company, the company has not discharged all of its debts
and liabilities or that it is for the name of the Labuan company to be
restored, make an order upon such terms declaring the dissolution to
be void, and such proceedings may be taken as if the company has
not been dissolved and the Court may by order give such directions
and make such provision.

Letter of confirmation and letter of good standing

151E. (1) The Authority may issue a letter of confirmation under its
seal, upon a request by any Labuan trust company, approved
192 Laws of Malaysia ACT 441

liquidator, receiver and manager, other person having written

permission of the officer of the company, member, debenture holder,
director or liquidator of the Labuan trust company or any person who
can demonstrate to the Authority that he has a good reason for doing
so, provided that—

(a) the name of the Labuan company is in the register;

(b) the Labuan company has paid all fees and penalties due and
payable; and

(c) the prescribed fee has been paid.

(2) A letter of confirmation issued under subsection (1) shall state

the following:

(a) the name of the Labuan company, its date of incorporation

and the company number;

(b) the registered address of the Labuan company;

(c) the directors and secretaries of the Labuan company;

(d) a statement to indicate whether the Labuan company is in

the process of being wound up and dissolved or being struck
off the register; or

(e) any other information as requested by a Labuan trust

company or an approved auditor as deemed fit by the
Authority.

(3) Where any information is lodged by the Labuan trust company

with the Authority under this Act, neither the Authority nor any of its
officers or employees involved in the issuance of the letter of
confirmation pursuant to subsection (1) shall be held liable for any
loss or damage suffered by any person by reason of any default, error
or omission if made in good faith and in the ordinary course of the
discharge of duties.
 Labuan Companies 193

Non-application of specified written laws

152. (1) The Yang di-Pertuan Agong may, by order published in

the Gazette, provide that any written law, or part thereof, specified in
the order, shall not apply in relation to a Labuan company, a foreign
Labuan company, a Labuan trust company, or a person who holds a
valid licence granted under the Labuan Financial Services and
Securities Act 2010 or the Labuan Islamic Financial Services and
Securities Act 2010, or shall apply thereto with such modifications as
may be set out in the order.

(1A) Except as otherwise expressly provided in this Act, the

provisions of the Companies Act 2016 shall not apply to a Labuan
company or a foreign Labuan company incorporated or registered
under this Act.

(2) The modifications made to a written law by an order made

under subsection (1) shall be deemed to be an integral part of such
written law for the purposes of the order.

(3) An order under subsection (1) may be made to have

retrospective effect from such date as may be specified in the order.

(4) In this section “modification” includes amendment, adaptation,

alteration, variation, addition, deletion, substitution, or exclusion.

Application of specified written laws

153. (1) Nothing in this Act shall affect the application of the
Financial Services Act 2013, Islamic Financial Services Act 2013 and
the Labuan Financial Services Authority Act 1996.

(2) In the application of the provisions of this Act to any person,

the provisions shall apply subject to the provisions of the Financial
Services Act 2013, Islamic Financial Services Act 2013 and the
Labuan Financial Services Authority Act 1996.
194 Laws of Malaysia ACT 441

(3) Where there is conflict or inconsistency between the

provisions of this Act and the Financial Services Act 2013, Islamic
Financial Services Act 2013, the provisions of the Financial Services
Act 2013, Islamic Financial Services Act 2013 shall prevail.

(4) Where there is conflict or inconsistency between the

provisions of this Act and the Labuan Financial Services Authority
Act 1996, the provisions of the Labuan Financial Services Authority
Act 1996 shall prevail.

*NOTE—see section 61 of the Labuan Companies (Amendment) Act 2022 [Act A1653] w.e.f 1 January
2022 which provides the following provision:

Savings and transitional provisions

61. (1) If a Labuan company has appointed a resident director pursuant to paragraphs 87(2)(a), (b) and
(c) of the principal Act, the Labuan company shall comply with subsection 87(2) of the principal Act, as
amended by subsection 31(b) of this Act, within the period of six months from the date of coming into
operation of this Act or any extended period approved by the Authority.

(2) All Labuan trust companies must comply with the requirements of subsection 93(2) of the principal
Act within the period of six months from the date of coming into operation of this Act or any extended
period approved by the Authority.

(3) Any inquiry, trial or proceedings done, taken or commenced under the principal Act before the
commencement of this Act shall be continued and concluded under and in accordance with the principal
Act as if the principal Act had not been amended by this Act

SCHEDULE

(Deleted by Act A1367)

195

LAWS OF MALAYSIA

Act 441

LABUAN COMPANIES ACT 1990

LIST OF AMENDMENTS

Amending law Short title In force from

Act A817 Offshore Companies (Amendment) 21-02-1992

Act 1992

P.U. (A) 72/1996 Labuan Offshore Financial Services 15-02-1996

Authority (Modification of Offshore
Companies Act 1990, Labuan Trust
Companies Act 1990, Offshore
Banking Act 1990 and Offshore
Insurance Act 1990) Order 1996

Act A988 Offshore Companies (Amendment) 20-03-1997

Act 1997

Act A1090 Offshore Companies (Amendment) 21-09-2000

Act 2000

Act A1367 Offshore Companies (Amendment) 11-02-2010

Act 2010

Act A1428 Labuan Companies (Amendment) 01-08-2012

Act 2012

Act A1653 Labuan Companies (Amendment) 10-06-2022 except

Act 2022 subsection 4(b):
01-01-2019

_____________
 LAWS OF MALAYSIA

Act 441

LABUAN COMPANIES ACT 1990

LIST OF SECTIONS AMENDED

Section Amending authority In force from

1 Act A1367 11-02-2010

2 P.U. (A) 72/1996 15-02-1996

Act A988 20-03-1997
Act A1367 11-02-2010
Act A1653 10-06-2022

5 Act A1367 11-02-2010

6 Act A817 21-02-1992

Act A988 20-03-1997
Act A1367 11-02-2010

7 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

8 Act A1367 11-02-2010

Act A1653 10-06-2022

9 Act A988 20-03-1997

Act A1367 11-02-2010

9A Act A1090 21-09-2000

Act A1367 11-02-2010
Act A1653 10-06-2022

9B Act A1090 21-09-2000

Act A1367 11-02-2010

9C Act A1090 21-09-2000

9D Act A1367 11-02-2010

10-13 Act A1367 11-02-2010

Act A1653 10-06-2022
 Labuan Companies 197

Section Amending authority In force from

14-17 Act A1367 11-02-2010

18 Act A1367 11-02-2010

Act A1428 01-08-2012

19 Act A1367 11-02-2010

21 Act A988 20-03-1997

Act A1367 11-02-2010

22 Act A1367 11-02-2010

Act A1653 10-06-2022

23 Act A1367 11-02-2010

25-26 Act A1367 11-02-2010

Act A1653 10-06-2022

PART IV Act A1367 11-02-2010

28 Act A1367 11-02-2010

29 Act A817 21-02-1992

Act A988 20-03-1997
Act A1367 11-02-2010

30 Act A1367 11-02-2010

31 Act A817 21-02-1992

Act A1367 11-02-2010

32-43 Act A1367 11-02-2010

46 Act A1367 11-02-2010

46A Act A1653 10-06-2022

47-50 Act A1367 11-02-2010

51 Act A988 20-03-1997

Act A1367 11-02-2010

53 Act A1367 11-02-2010

Act A1653 10-06-2022
198 Laws of Malaysia ACT 441

Section Amending authority In force from

54 Act A1653 10-06-2022

55 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

56-57 Act A1367 11-02-2010

58 Act A1367 11-02-2010

Act A1653 10-06-2022

61-68 Act A1367 11-02-2010

69-73 Act A1653 10-06-2022

78 Act A1653 10-06-2022

80 Act A1653 10-06-2022

81 Act A1367 11-02-2010

Act A1653 10-06-2022

83 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

84 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

84A Act A1653 10-06-2022

85 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

86 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

87 Act A817 21-02-1992

Act A988 20-03-1997
Act A1367 11-02-2010
Act A1653 10-06-2022
 Labuan Companies 199

Section Amending authority In force from

88 Act A1367 11-02-2010

90-92 Act A1367 11-02-2010

Act A1653 10-06-2022

93 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

94 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

94A Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

94B Act A1367 11-02-2010

95 Act A1367 11-02-2010

101A Act A1367 11-02-2010

103 Act A1367 11-02-2010

105 Act A1367 11-02-2010

Act A1653 10-06-2022

106 Act A988 20-03-1997

108A-108H Act A1653 10-06-2022

109 Act A817 21-02-1992

Act A1367 11-02-2010

110 Act A1367 11-02-2010

Act A1653 10-06-2022

111 Act A817 21-02-1992

Act A1367 11-02-2010
Act A1428 01-08-2012
Act A1653 10-06-2022

112 Act A817 21-02-1992

Act A1653 10-06-2022
200 Laws of Malaysia ACT 441

Section Amending authority In force from

113 Act A1367 11-02-2010

Act A1653 10-06-2022

113A Act A817 21-02-1992

Act A1367 11-02-2010

114 Act A1367 11-02-2010

Act A1653 10-06-2022

117 Act A1367 11-02-2010

118 Act A1367 11-02-2010

118A-118D Act A1367 11-02-2010

119 Act A1367 11-02-2010

120 Act A1367 11-02-2010

Act A1653 10-06-2022

121 Act A988 20-03-1997

Act A1367 11-02-2010
Act A1428 01-08-2012

122 Act A1367 11-02-2010

123 Act A1367 11-02-2010

Act A1653 10-06-2022

124 Act A1367 11-02-2010

126 Act A988 20-03-1997

127 Act A1367 11-02-2010

Act A1653 10-06-2022

128 Act A1653 10-06-2022

130 Act A1653 10-06-2022

PART VIIIA Act A988 20-03-1997

Act A1367 11-02-2010

130A-130M Act A988 20-03-1997

Act A1367 11-02-2010
 Labuan Companies 201

Section Amending authority In force from

PART VIIIB Act A1367 11-02-2010

130N Act A1367 11-02-2010

130O Act A1367 11-02-2010

Act A1428 01-08-2012

130P-130S Act A1367 11-02-2010

130T Act A1367 11-02-2010

Act A1653 10-06-2022

130U Act A1367 11-02-2010

130V Act A1367 11-02-2010

Act A1428 01-08-2012

130W-130Z Act A1367 11-02-2010

130ZA Act A1367 11-02-2010

130ZB Act A1367 11-02-2010

130ZC Act A1367 11-02-2010

PART IX Act A1367 11-02-2010

131 Act A1367 11-02-2010

Act A1653 10-06-2022

131A Act A1367 11-02-2010

132 Act A1653 10-06-2022

PART X Act A1367 11-02-2010

133-135 Act A1367 11-02-2010

137 Act A1367 11-02-2010

137A Act A1367 11-02-2010

141 Act A988 20-03-1997

Act A1367 11-02-2010
202 Laws of Malaysia ACT 441

Section Amending authority In force from

142 Act A1367 11-02-2010

Act A1653 10-06-2022

142A Act A1367 11-02-2010

Act A1653 10-06-2022

143-146 Act A1367 11-02-2010

147 Act A988 20-03-1997

Act A1367 11-02-2010

148-149 Act A1367 11-02-2010

150 Act A817 21-02-1992

Act A988 20-03-1997
Act A1367 11-02-2010

151 Act A817 21-02-1992

Act A988 20-03-1997
Act A1367 11-02-2010
Act A1428 01-08-2012
Act A1653 10-06-2022

151A-151B Act A988 20-03-1997

151AA-151BB Act A1653 10-06-2022

151C Act A988 20-03-1997

Act A1367 11-02-2010
Act A1653 10-06-2022

151D-151E Act A1367 11-02-2010

Act A1653 10-06-2022

152 Act A817 21-02-1992

Act A1367 11-02-2010
Act A1653 10-06-2022

153 Act A1367 11-02-2010

Act A1653 10-06-2022

SCHEDULE Act A1367 11-02-2010