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1 -1. Short-title.

This Act may be cited as the Kootu Funds (Prohibition) Act 1971 .

2 -2. Interpretation.

(1) In this Act, unless the context otherwise requires:

  "company"  means a company as defined in the Companies Act 1965 (Act 125) , and includes a corporation as defined in the said Act;

  "kootu fund"  means a scheme or arrangement variously known as a kootu, cheetu, chit fund, hwei, tontine or otherwise whereby the participants subscribe periodically or otherwise to a common fund and such common fund is put up for sale or payment to the participants by auction, tender, bid, ballot or otherwise and includes any scheme or arrangement which with variations partakes of the nature of a kootu, cheetu, chit fund, hwei or tontine;

  "Minister"  means, except in sections 4, 5 and 6, the Minister for the time being in charge of domestic trade and consumer affairs;

3 -3. Unlawful to carry on business of promoting kootu funds.

It shall be unlawful for any person to carry on the business of promoting kootu funds and any person who carries on such business shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding five hundred thousand ringgit or to imprisonment for a term not exceeding ten years or to both.

[Am. by Act A1397: s.2]

4 -4. Registration of a business which promotes kootu funds prohibited in the States of West Malaysia.

(1) There shall not be registered under the Registration of Businesses Act 1956 [Act 197] of the States of Peninsular Malaysia (hereinafter in this section referred to as “the Act”) any business which promotes or is designed to promote kootu funds.

(2) No person shall obtain registration under the Act of any business which promotes or is designed to promote kootu funds.

(3) No person who carries on a business which is registered under the Act shall carry on the business of promoting kootu funds.

(4) Any associate of a business which, on the date of coming into force of this Act, is registered under the Act and which promotes or is designed to promote kootu funds shall forthwith cease to do such business and shall forthwith inform the Registrar that the business promotes or is designed to promote kootu funds and thereupon the Registrar shall forthwith revoke the certificate of registration of such business.

5 -5. Licensing of a business which promotes kootu funds prohibited in Sabah.

(1) There shall not be licensed under the Trades Licensing Ordinance of Sabah [Cap. 144] (hereinafter in this section referred to as “the Ordinance”) any business which promotes or is designed to promote kootu funds.

(2) No person shall obtain a trading licence under the Ordinance in respect of any business which promotes or is designed to promote kootu funds.

(3) No person who carries on a business which is licensed under the Ordinance shall carry on the business of promoting kootu funds.

(4) Any proprietor or partner of a business which, on the date of coming into force of this Act, is licensed under the Ordinance and which promotes or is designed to promote kootu funds shall forthwith cease to do such business and shall forthwith inform the licensing authority that the business promotes or is designed to promote kootu funds and thereupon the licensing authority shall forthwith revoke the trading licence i

6 -6. Licensing of a business which promotes kootu funds prohibited in Sarawak.

(1) There shall not be licensed under the Businesses, Professions and Trades Licensing Ordinance of Sarawak (Sarawak Cap. 33) (hereinafter in this section referred to as "the Ordinance") any business which promotes or is designed to promote kootu funds.

(2) No person shall obtain a trading licence under the Ordinance in respect of any business which promotes or is designed to promote kootu funds.

(3) No person who carries on a business which is licensed under the Ordinance shall carry on the business of promoting kootu funds.

(4) Any proprietor of a business which, on the date of coming into force of this Act, is licensed under the Ordinance and which promotes or is designed to promote kootu funds shall forthwith cease to do such business and shall forthwith inform the Collector that the business promotes or is designed to promote kootu funds and thereupon the Collector shall forthwith revoke the trading licence in resp

7 -7. Registration of a company which promotes kootu funds prohibited.

There shall not be registered under the Companies Act 1965 any company which has as its objects or as one of its objects the promotion of kootu funds.

8 -8. Registered company which promotes kootu funds to cease business.

(1) Upon the coming into force of this Act, a registered company which has its objects or as one of its objects the promotion of kootu funds (hereinafter in this section and in section 9 referred to as "such company") shall forthwith cease to carry on the business of promoting kootu funds.

(2) Every such company shall either:-

(a) within ninety days from 18 February 1971 take the necessary steps under the Companies Act 1965 to have its memorandum of association and (if any) articles of association altered so that they do not provide for it to carry on the business of promoting kootu funds; or

(b) within ninety days from 18th February 1971 or within one month of the expiry of the total period for which permission may have been granted under subsection (3), whichever is the longer, either:-

(i) resolve by special resolution that it be wound up voluntarily, under paragraph 254(1)<

9 -9. Winding up on application by Minister.

(1) If such company fails to take action under subsection 8(2) or if, having taken such action, it fails to obtain the required alteration of its memorandum of association and (if any) articles of association or complete its voluntary winding up or obtain the order of the Court that it be wound up, as the case may be, within a reasonable time, the Minister-

(a) may cause to be made such investigation of the affairs of such company and in such manner as he deems appropriate; and

(b) shall present a petition to the Court:

(i) for the winding up of such company; or

(ii) in the case of a foreign company, for the winding up of the affairs of such company so far as the assets of such company within Malaysia are concerned,

under section 205 of the Companies Act 1965, and such company shall, for the purpose of the said section, be deemed to be a declared company in re

10 -10. Criminal liability.

(1) If the person committing an offence under this Act is a company, every person who at the time the offence was committed was a director, general manager, manager, secretary or other officer of the company concerned in the management of the company in the Federation or who was purporting to act in any such capacity, he as well as the company shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly:

Provided that it shall be a defence for such person, if he proves that the offence was committed without his consent or connivance and that he exercised such diligence to prevent the commission of the offence as he ought to have exercised having regard to the nature of his functions and to all other circumstances.

(2) For the purpose of this section "company" includes:-

(i) any body corporate;

(ii) a firm or other association of individuals;

(iii)

11 -11. Rules.

The Minister may make rules for carrying into effect the objects and purposes of this Act.

12 -12. This Act to prevail.

The provisions of this Act shall be without prejudice to the provisions of the Registration of Businesses Act 1956 of the States of Peninsular Malaysia or the Trades Licensing Ordinance of Sabah or the Businesses, Professions and Trades Licensing Ordinance of Sarawak or the Companies Act 1965 but where there is a conflict between any of the said Ordinances or the said Companies Act and this Act the provisions of this Act shall prevail.

13 -13. Repeal.

The Emergency (Essential Powers) Ordinance No. 84, 1971 [P.U.(A) 69/1971] is hereby repealed.