Companies 1

LAWS OF MALAYSIA
Act 777

COMPANIES ACT 2016

208 Laws of Malaysia Act 777

Subdivision 2
Directors

Directors of company

196. (1) A company shall have a minimum number of directors

as follows:

in the case of a private company, one director; or

(a)

in the case of a public company, two directors.

(b)

(2) A director shall be a natural person who is at least

eighteen years of age.

(3) A director of a company shall not resign or vacate his

office if by his resignation or vacation from office, the number of
directors of the company is reduced below the minimum number
required under subsection (1) and any purported resignation or
vacation of office in contravention of this section shall be deemed
to be ineffective unless a person is appointed in his place.

(4) For the purposes of this section, the minimum number of

directors—

shall ordinarily reside in Malaysia by having a

(a)
principal place of residence in Malaysia; and

(b) shall not include an alternate or substitute director.

Persons connected with directors

197. (1) A person shall be deemed to be connected with a

director if the person is—

a member of the director’s family;

(a)

a body corporate which is associated with that director;

(b)

a trustee of a trust, other than a trustee for an employee

(c)
share scheme or pension scheme, under which that
director or a member of the director’s family is a
beneficiary; or
 Companies 209

a partner of that director or a partner of a person

(d)
connected with that director.

(2) For the purposes of this section—

(a) “a member of the director’s family” means the director’s

spouse, parent, child, including adopted child and
stepchild, brother, sister and the spouse of the director’s
child, brother or sister;

(b) a body corporate is associated with a director if—

(i) the body corporate is accustomed or is under

an obligation, whether formal or informal, or
the majority of directors of the body corporate
is accustomed, to act in accordance with the
directions, instructions or wishes of that director;

(ii) that director has a controlling interest in the body

corporate; or

(iii) that director, or persons connected with that

director, or that director and persons connected
with him, are entitled to exercise, or control the
exercise of, not less than twenty per centum of
the votes attached to voting shares in the body
corporate.

Persons disqualified from being a director

198. (1) A person shall not hold office as a director of a company

or whether directly or indirectly be concerned with or takes part
in the management of a company, if the person—

is an undischarged bankrupt;
(a)

has been convicted of an offence relating to the promotion,

(b)
formation or management of a corporation;

has been convicted of an offence involving bribery,

(c)
fraud or dishonesty;