GUIDELINES ON THE QUALIFICATION OF LIQUIDATOR UNDER SECTION 433 OF COMPANIES ACT 2016

Transcription

1 GUIDELINES ON THE QUALIFICATION OF LIQUIDATOR UNDER SECTION 433 OF COMPANIES ACT 2016 This Guidelines is issued pursuant to section 20C of the Companies Commission of Malaysia Act OBJECTIVE This Guidelines serves to guide an individual who wish to apply to be an approved liquidator pursuant to section 433 of the Companies Act 2016 (CA 2016). BACKGROUND 2. The CA 2016 introduces a distinct requirement with regard to the qualification and approval process to be an approved liquidator. Under the new framework, the condition precedent that a person must be an approved company auditor before he can apply to be licenced as an approved liquidator has been removed. 3. The new framework allows any person who is a member of a recognised professional body to apply to the Minister of Finance (MOF) to be approved as a liquidator. 1

2 4. The decoupling of the approval requirements is in tandem with the introduction of the corporate rescue mechanism framework under Division 8 of Part III of the CA 2016 which recognises the role of liquidators as insolvency practitioners in the wider context of being appointed as a nominee in the corporate voluntary arrangement or as a judicial manager in a judicial management. GENERAL REQUIREMENTS UNDER SECTION 433 OF THE COMPANIES ACT Section 433(3) states that - Any person who is a member of a recognized professional body may apply to the Minister charged with the responsibility for finance to be approved as a liquidator. 6. Further, Section 433(5) states that - The Minister charged for companies ( The Minister ) may, in consultation with the Minister charged with the responsibility for finance, prescribe a body to be a recognized professional body. 7. The approval as a liquidator is subject to the requirement under section 433(4) of the CA 2016 as stated below: The Minister charged with the responsibility for finance may approve such person as a liquidator if he is satisfied with 2

3 experience and capacity of the person and upon payment of the prescribed fee by such person. RECOGNIZED PROFESSIONAL BODIES UNDER SECTION 433(5) OF THE CA For the purpose of liquidators approval, the recognized professional bodies (RPBs) under section 433(5) of the CA 2016 are as follows: (a) (b) Malaysia Institute of Accountant (MIA); and Malaysian Institute of Certified Public Accountant (MICPA). 9. The recognition of MIA and MICPA as recognized professional bodies is done vide Gazette No. PU(B)/123/2018 on 15 March APPLICATION TO BE APPROVED AS A LIQUIDATOR 10. The application to be approved as a liquidator shall be made to the MOF through the Accountant General s Department of Malaysia which is currently responsible for the application and renewal of an approved Company Auditor and Liquidator. 11. The requirements to be an approved liquidator are as follows: (a) The applicant must be a natural person; (b) The applicant must be a citizen or permanent resident of Malaysia; (c) The applicant is not an undischarged bankrupt; 3

4 (d) The applicant has not been convicted of an offence relating to the promotion, formation, management or winding up of a corporation; (e) The applicant has not been convicted of an offence involving bribery, fraud or dishonesty punishable on conviction by imprisonment for three months or more; and (f) The applicant does not have any pending legal action against him under any provision of CA 2016 or the laws specified in the First Schedule of Companies Commission of Malaysia Act The applicant have to submit Statutory Declaration signed by a Commissioner of Oaths together with the application to verify that he has complied with the above requirements. 11. Applicant who has fullfil the requirements under paragraph 8 must satisfy the following criteria prior to the submission of his application: (a) Recognised Professional Bodies (RPBs) (i) The applicant must be a member of any of the RPBs pursuant to section 433(3) of the CA (ii) Additionally, MICPA members who wish to apply to be approved as a liquidator must be registered with MIA pursuant to section 22 of the Accountants Act

5 (b) Working Experience (i) The applicant must have at least five (5) years of accumulated working experience in insolvency practice on full time basis. Experience gained before RPB membership can be recognized. (ii) An applicant who has the relevant working experience but is no longer in an insolvency practice, is still eligible to apply if he has - (a) not left the insolvency practice more than three (3) years from the date of application; or (b) Left the insolvency practice for more than three (3) years but has working experience in insolvency practice within the Malaysian environment of at least one (1) year immediately prior to the submission of his application. (iii) An applicant who is a member of RPB and having at least five (5) years experience in insolvency practice in other jurisdictions can also be considered provided he has practiced at least one (1) year in Malaysian environment on a full time basis immediately prior to the submission of his application. (iv) Applicant must attach a sponsor letter from an approved liquidator, who has supervised the applicant's work. The sponsor must not be the applicant s client or family members. The sponsor letter should comment on the applicant's character, his ability to perform insolvency 5

6 work, his role in specific insolvency jobs (where applicable) and other relevant experience. (c) Interview The applicant must pass an oral assesment interview by the panel interviewers comprising representatives to be determined by MOF. 12. The applicant can only proceed to submit the application to be approved as a liquidator to MOF through the BLESS system after all the requirements mentioned above have been fulfilled. VALIDITY OF THE APPROVAL 13. The approval shall be valid for a period of two (2) years or a period specified by MOF from the date of approval unless sooner suspended or revoked by MOF or upon the surrender of approval licence as an approved liquidator. APPLICATION FOR RENEWAL OF APPROVAL AS LIQUIDATOR 14. Application for renewal must be submitted through BLESS three (3) month before the expiry date. 15. A person whose approval as an approved liquidator has expired shall be deemed to be suspended until the approval has been renewed. 6

7 16. An approved liquidator needs to renew the approval within one year from the date of expiry of the existing approval, failing which the person shall cease to be an approved liquidator. 17. If the approved liquidator failed to renew the approval after one year has lapsed upon the expiry of the approval, he is required to submit a fresh application and attend the interview session again. 18. Approved liquidators who wish to renew their approval as an approved liquidator should submit the application for renewal of approval to MOF through BLESS system. SUSPENSION AND REVOCATION OF APPROVAL 19. The Minister may suspend or revoke the approval as liquidator if there is a contravention of any of the provisions under the CA 2016 and the requirements specified in this Guidelines. 20. A person whose approval has been suspended shall be deemed as if he has not been approved under section 433(4) of the CA 2016 during that suspension period. Companies Commission of Malaysia Date : XXX 7