Company Law 101: The Brief Lesson on Section 241 of the Companies Act 2016

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Section 241 of the Companies Act 2016 (CA) came into force on the 15 March 2019. What it entails is this: Any person who is already a company secretary or any person who is qualified to act as a secretary must now register with the Registrar of the Companies before he can act as a secretary1.

The Companies Commission of Malaysia (CCM) even issued a guideline2 to ensure that matters that are incidental to Section 241 is clarified. Without further delay, below are some of the important details that a practising company secretary/ person interested to become a company secretary needs to know in regards to this issue:

Who should read up on thisAny person who is qualified and interested to become a company secretary after the enforcement of Section 241 of the CA or Any company secretary who wishes to renew their practising certificate after the enforcement of Section 241 of the CA.
Qualification for a citizen/ permanent resident of Malaysia3
  1. Must be a natural person;
  2. Eighteen years of age and above;
  3. Licensed by the CCM under section 20G of the Companies Commission of Malaysia Act 2001 (‘CCMA’), or is a member of:
    1. Malaysian Institute of Chartered Secretaries and Administrators (MAICSA);
    2. Malaysian Institute of Accountants (MIA);
    3. Malaysian Bar (BC);
    4. Malaysian Association of Company Secretaries (MACS);
    5. Malaysian Institute of Certified Public Accountants (MICPA);
    6. Sabah Law Association (SLA); or
    7. Advocates Association of Sarawak (AAS).
  4. Not disqualified under Section 238 of CA4; and
  5. Does not have any pending legal action against him under any provision of the laws specified in the First Schedule of the Companies Commission of Malaysia Act 2001 (CCMA).5
Qualification for non-citizen/non-permanent resident of Malaysia6
  1. Must be a natural person;
  2. Eighteen years of age and above;
  3. Has been appointed as a secretary before 31 January 2017;
  4. Can only act as a secretary of the company of which he was appointed before 31 January 2017;
  5. Cannot accept any new appointment as a secretary; and
  6. Subject to item (3)-(5) mentioned above.
How to renew?Via https://esecretary.ssm.com.my/. In this regard:

  1. The renewal must be made not less than 30 days before the expiry date of the practising certificate.
  2. The renewal application must:
    1. Complied with the item (4) and (5) mentioned above;
    2. Must be fit and proper to be issued with a practising certificate7; and
    3. Must have completed the Continuing Professional Education (CPE) requirements.8
The validity of the practising certificate93 years
What amounts to “fit and proper”10?
  1. The character, qualification and experience of the applicant;
  2. Public interest; and
  3. Whether the applicant has previously contravened any provisions of the laws specified in the First Schedule of the CCMA.
CPE Requirements11
  1. Minimum hours (based on the validity period of the practising certificate):
    1. 1 year – 20 CPE hours
    2. 2 year – 40 CPE hours (cumulative)
    3. 3 year – 60 CPE hours (cumulative)
  2. Type of training courses:
    1. Courses relating to company secretarial practice, company and corporate law (minimum of 60% of total minimum CPE hours)
    2. Courses relating to the industry in which a company is operating (maximum of 25% of total minimum CPE hours)
    3. Courses relating to personal development (maximum of 15% of total minimum CPE hours)
What is the deadline for existing practitioners to renew their practising certificate?12 months from the enforcement date.
What happens if an existing practitioner fails to renew their practising certificate12?The Registrar will cancel the applicant’s practising certificate.

If this were to happen, the secretary will have to submit a new application and he will be treated as though he has never applied for a practising certificate.

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1. Section 241 (1), Companies Act 2016.
2. Guidelines Relating To Practising Certificate For Secretaries Under Section 241 Of The Companies Act 2016. https://www.ssm.com.my/Pages/Legal_Framework/Document/GUIDELINE%20FOR%20REGISTRATION%20TO%20ACT%20AS%20SECRETARY%20UNDER%20S%20241%20AS2016_FINAL.pdf.
3. Section 235, Companies Act 2016.
4. Paragraph 8 of the Guidelines Relating To Practising Certificate For Secretaries Under Section 241 Of The Companies Act 2016. https://www.ssm.com.my/Pages/Legal_Framework/Document/GUIDELINE%20FOR%20REGISTRATION%20TO%20ACT%20AS%20SECRETARY%20UNDER%20S%20241%20AS2016_FINAL.pdf.
5. Ibid.
6. Paragraph 6, Ibid.
7. Paragraph 11, Ibid.
8. Paragraph 34 and 35, Ibid.
9. Paragraph 16, Ibid.
10. Paragraph 11, Ibid.
11. Paragraph 35, Ibid.
12. Paragraph 15, Ibid.

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