Group: A’dalah

Please answer all the questions below. Your answers must be based on Malaysian law. (Total:
20 marks)

1. Is it a must for each company to appoint a company secretary? Explain. (2m)

Yes, it is a must for each company to appoint company secretary at least one under section
235(1). The reason why a company needs a secretary is because the director does not
necessarily know all the matters, especially technical matters like the documentation for the
submission to the SSM (Registrar of Companies), the preparation of minute of meeting, report
of the meeting, allotment of shares documentation, issuance of shares documentation and
application for licensing.

2. What are the qualifications of company secretary in Malaysia? (2 m.)

To be a secretary, a person must be at least 18 years old, a natural person and a citizen or
permanent resident of Malaysia. To ensure that the person appointed is qualified, section
235(2)(a) Companies Act 2016 provides that the person must be a member of the prescribed
body as set out in the Fourth Schedule. The approved bodies in the schedule are Malaysian
Institute of Chartered Secretaries and Administrators, Malaysian Institute of Accountants,
Malaysian Bar, Malaysian Association of Company Secretaries, Malaysian Institute of Certified
Public Accountants, Sabah Law Association and Advocates Association of Sarawak. A person may
also qualify to be a secretary even if he is not a member of these bodies if he is licensed by the
Registrar of Companies under section 20G Companies Commission of Malaysia Act 2001 with
the purpose of being a secretary. However, due to the new regulations under section 241
Companies Act 2016 that are enforced on 15 March 2019, all qualified persons who desire to act
as a secretary must register with the Registrar of Companies irrespective of their professional
background.

3.What are the implications of having an unqualified secretary in Malaysia? (2 m)

A Company Secretary’s roles are largely related to the legal matters. The biggest
responsibilities of a company secretary is, handling the company’s statutory books
and streamlining procedural legal matters that related to the company. Therefore,
having an unqualified secretary could cause the company to be unaware and
unprepared by laws that would have disastrous bearing on the company, where
supposedly the company secretary should ensure that the company is all-time
compliance with different regulations that touch the company’s matters.
4. List down all the relevant laws involving company secretaries in Malaysia. (2 m.)

1) Section 235(1) - Company must have at least 1 secretary

2) Section 235(2) - Licensing
3) Section 236- Appointment of a secretary
4) Section 237- Resignation of a secretary
5) Section 238- Disqualification of secretaries
6) Section 239- Disqualification to act as a secretary
7) Section 240- Office of secretary shall not be left vacant
8) Section 241 - Practising certificate
9) Section 242- Prohibition to act in dual capacity
10) Section 102(1)- Manage registration of members (register of members is properly kept)
11) Section 102(2)- Manage registration of members (secretary commit an offense and will
be fined)
12) Section 58- Secretary submit the documents to ROC of the particulars of directors,
managers, and secretaries
13) Section 68- Secretary submit the company’s annual returns
14) Section 221- Manage meetings

5. Provide three examples of infringement of duties of secretaries in Malaysia? From the

examples your group provided, please discuss the relevant legal aspects using the Companies
Act 2016, other relevant Regulations and Guidelines. (12m.)

There are three main statutory duties of Company Secretary which are managing registration of
members, managing submission of documents to Registrar of Companies (ROC) and managing
meetings. Thus, the infringement of duties of secretary is when the secretary did not manage or
ignore the registration of members of the company. Secondly, the secretary did not manage the
submission of documents to the Registrar of Company. Last but not least, the secretary did not
manage the meeting of the company.

For the first example which is when the secretary ignores its duty to manage the registration of
the members, the secretary needs to ensure the register of members is properly kept and
maintained regularly pursuant to section 102(1) of Company Act 2016. However, if the secretary
loses the documents related to the register of members, he/she is liable to be infringed. Based
on section 102(2) of Company Act 2016, when the register of members is not properly kept or
maintained, the secretary has committed an offense and will be fined.

Another example that can portray the infringement of duties of secretary is when the secretary
did not manage to submit the documents to the Registrar of Company. Supposedly, the
secretary must submit documents such as the particulars of directors, managers and secretaries
(section 58) and the company’s annual returns to the Registrar of Company (section 68).
However, if the secretary contravene section 58, the secretary is liable to a fine not exceeding
fifty thousand ringgit and in the case of a continuing offense, to a further fine not exceeding five
hundred ringgit for each day during which the offense continues after conviction. Meanwhile, if
the secretary contravene section 68, the secretary is liable to a fine not exceeding fifty thousand
ringgit and in the case of continuing offense, to a further fine not exceeding one thousand
ringgit for each day during which the offence continues after conviction.

The last example of the infringement of duties by the secretary is when they did not manage the
meeting of the company effectively. According to Section 221 of Companies Act 2016, a
secretary is required to prepare and issue the notice of meetings to the members of the
company before the meeting is held. Next, a secretary also needs to record and prepare the
minutes of meetings in order to record all the matters happening in the meeting and record the
declaration of interest by directors. However, according to Section 221(12), if the secretary
contravene this section, the secretary is committing an offence and shall, on conviction, be liable
to imprisonment for a term not exceeding five years or to a fine not exceeding three million
ringgit or both.