Study Manual - Nature of Registered Companies

Nature Of Registered Companies

ICSA IQS – Corporate Law 1

CHAPTER 1

NATURE OF REGISTERED COMPANIES

Chapter objectives

After the completion of this chapter you should be able to understand amongst other

things:

• The legal and non legal sources of Malaysian Corporate law;

• That Malaysian Corporate law is not static and reforms are underway;

• That various bodies regulate registered companies;

• That upon registering a company a registered company will become a corporation

and in consequence of that the registered company has a distinct legal personality

from that of its members and controllers;

• That there are advantages and disadvantages in using a registered company as a

medium to transact business;

• That registering a company so as to create a business corporation requires due

compliance with formalities as prescribed by the Companies Act 1965;

• That upon registering a company the registered company, its members and

controllers will be subject to the effects of incorporation;

• That limited liability of members has nothing to do with the corporate personality

of a registered company but instead it is a privilege accorded by parliament to

members of a limited company;

• That the corporate personality of a registered company can at times be abused and

therefore the Companies Act 1965 as well as the common law allows for the lifting

or piercing of the corporate veil;

Nature Of Registered Companies

ICSA IQS – Corporate Law 2

AN INTRODUCTION TO MALAYSIAN CORPORATE LAW

1.1 Corporate law is that body of law that deals specifically with the functioning of a

corporation. A company that is registered with Companies Commission of

Malaysia (hereinafter referred to as CCM) in accordance to the Companies Act

1965 (hereinafter referred to as CA) is a body corporate and therefore a

corporation.