One of the best steps a business will ever take is registering as a legal entity. Business registration gives the business and its owners of administrators a proper perspective of what business truly is. Doing business without proper registration is just illegal.
The business is just there, unregulated by any institution yet it keeps making money from the economy of the country. In fact, unregistered business faces higher risk by not being a legal entity because a lot of government support for business will not pass through their way at all.
Under Section 196(4) of Companies Act 2016 stated that, in order to incorporate a company, there must be at least one director who ordinarily resides in Malaysia by having a principal place of residence in Malaysia (‘resident director’) and exclude an alternate or substitute director.
The requirement of residency is mainly to ensure that there is a point of contact in Malaysia and for purposes of enforcement. While, according to Section 42(1)(b) of Companies Act 2016, there must be at least one and not more than 50 shareholders being appointed as members of the company regardless of the citizenship of the person.
According to Section 235(1) of Companies Act 2016, a company shall have at least one secretary who shall be a natural person, aged 18 years and above, and a Malaysian citizen or permanent resident.
The appointment of a company secretary at the point of incorporation is optional. Under section 236 of the Companies Act 2016, the Board must appoint a company secretary within 30 days from the date of incorporation of a company.
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