FINANCIAL SERVICES ACT 2013
(1) This Act may be cited as the Financial Services Act 2013.
(2) This Act comes into operation on a date to be appointed by the Minister by notification in the Gazette and the Minister may appoint different dates for the coming into operation of different parts or different provisions of this Act.
(1) In this Act, unless the context otherwise requires:
"adjuster" means a person who carries on adjusting business;
"adjusting business" means the business of investigating the cause and circumstances of a loss and ascertaining the quantum of the loss in relation to insurance or takaful claims;
"advertisement" means the disseminating or conveying of information, invitation or solicitation by any means or in any form including oral and written communication by means of print, electronic and any other media;
"agreement" means an agreement whether formal or informal, oral or written, express or implied;
"annuity" means the right to a series of periodical payments at intervals of one year or less unde 3 PART I PRELIMINARY-3. Prescription by Minister of additional business or activity.
The Minister may, on the recommendation of the Bank, prescribe:
(a) any business or activity as an addition to the definition of:
(i) "banking business";
(ii) "investment banking business";
(iii) "financial intermediation activities";
(iv) "factoring business"; or
(v) "leasing business",
and upon such prescription, the definition as added to shall be deemed to be an integral part of this Act as from the date of commencement of such prescription, or from such later date as may be specified in the order; and
(b) any business, service or activity in relation to a financial service as a financial advisory business for the purposes of the definition of "financial advisory business" under subsection 2(1).
4 PART I PRELIMINARY-4. Prescription by Bank of additional agreement, dealing, transaction or person.
The Bank may, with the concurrence of the Minister, prescribe:
(a) any agreement in respect of a financial transaction that may be entered into by parties in the financial markets, other than a standardized derivative or an agreement in respect of securities transactions entered into under the rules of a stock exchange and approved clearing house as defined in subsection 2(1) of the Capital Markets and Services Act 2007 as a qualified financial agreement for the purposes of the definition of "qualified financial agreement" in subsection 2(5);
(b) any dealing or transaction as a credit facility for the purposes of the definition of "credit facility" in subsection 2(1); and
(c) any other person as a market participant for the purposes of the definition of "market participant" in subsection 2(1).
5 PART I PRELIMINARY-5. Classification of, and construction of references to, insurance business.
(1) for the purposes of this Act, insurance business shall be divided into two classes:
(a) life business, which in addition to all insurance business concerned with life policies shall include any type of insurance business carried on as incidental only to the life insurer's business; and
(b) general business, which means all insurance business which is not life business.
(2) for the purposes of this Act, the reinsurance of liabilities under insurance policies shall be treated as belonging to the same class and description as the insurance policies being reinsured.
(3) Notwithstanding anything in subsection (1) or the determination of a policy to a particular insurance fund by a licensed insurer, if the Bank is satisfied that any part of the licensed insurer's business which belongs to a particular class or description of insurance business ought in that licensed insurer's ca
6 PART II REGULATORY OBJECTIVES AND POWERS AND FUNCTIONS OF BANK-6. Regulatory objectives.
The principal regulatory objective of this Act is to promote financial stability and in pursuing this objective, the Bank shall:
(a) foster:
(i) the safety and soundness of financial institutions;
(ii) the integrity and orderly functioning of the MONEY MARKET AND FOREIGN EXCHANGE MARKET;
(iii) safe, efficient and reliable payment systems and payment instruments; and
(iv) fair, responsible and professional business conduct of financial institutions; and
(b) strive to protect the rights and interests of consumers of financial services and products.
7 PART II REGULATORY OBJECTIVES AND POWERS AND FUNCTIONS OF BANK-7. Powers and functions of Bank.
(1) The Bank shall exercise the powers and perform the functions under this Act in a way which it considers most appropriate for the purpose of meeting the regulatory objectives of this Act and the Governor shall exercise such powers and perform such functions of the Bank on its behalf.
(2) The powers and functions of the Bank under this Act are in addition to, and not in derogation of, the powers and functions of the Bank under the Central Bank of Malaysia Act 2009.
(3) The Bank shall, from time to time, keep the Minister informed on matters relating to the exercise of its powers and performance of its functions under this Act.
(4) The Bank may authorize a Deputy Governor or an officer of the Bank to exercise any of its powers or perform any of its functions under this Act.
(5) The Bank may establish and authorize a committee consisting of members as the Bank may determine for the purpose of exercising any of the powers
8 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-8. Authorized business to be carried on by authorized person.
(1) No person shall carry on any authorized business unless it is:
(a) licensed by the Minister, on the recommendation of the Bank, under section 10 to carry on banking business, insurance business or investment banking business; or
(b) approved by the Bank under section 11 to carry on any of the businesses set out in Division 1 of Part 1 of Schedule 1.
(2) Paragraph (1) (b) shall not apply, in respect of financial advisory business, to persons set out in Division 2 of Part 1 of Schedule 1.
(3) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
9 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-9. Application for authorization.
An applicant for a licence under section 10 or an approval under section 11 to carry on an authorized business shall submit the application in writing to the Bank together with such documents or information as may be specified by the Bank.
10 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-10. Grant of licence by Minister.
(1) In assessing an application duly made under section 9 to carry on any licensed business, the Bank shall have regard to all the factors set out in Part 1 and Part 2 of Schedule 5 and such other matters that the Bank considers relevant.
(2) Upon making an assessment under subsection (1) and where the Bank is satisfied that such applicant may be granted a licence, the Bank shall make a recommendation to the Minister to grant a licence under subsection (4) with or without conditions.
(3) The Bank shall notify the applicant in writing if the Bank does not make a recommendation to the Minister under subsection (2).
(4) Where the Bank makes a recommendation pursuant to subsection (2), the Minister may grant a licence to the applicant to carry on banking business, insurance business or investment banking business, with or without conditions.
(5) The Bank shall notify the applicant in writing of the decision of the Minister u
11 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-11. Approval by Bank.
(1) In assessing an application duly made under section 9 to carry on any approved business, the Bank shall have regard to all the factors set out in Part 1 of Schedule 5 and such other matters that the Bank considers relevant.
(2) The Bank may:
(a) approve an application to carry on any approved business, with or without conditions, or for such period as stated in the approval; or
(b) reject the application.
(3) A person approved under paragraph (2) (a) to carry on insurance broking business or financial advisory business shall at all times have in force a professional indemnity insurance or takaful of such amount as may be specified by the Bank.
(4) The Bank shall notify the applicant in writing of its decision under subsection (2).
(5) Where the Bank approves an application under paragraph (2) (a) , an approved person shall commence its approv
12 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-12. Requirements on minimum capital funds or surplus of assets over liabilities.
(1) No person shall be granted a licence under section 10 or an approval under section 11 if:
(a) in the case of a company, its capital funds; or
(b) in the case of a branch established in Malaysia by a foreign institution, its surplus of assets over liabilities,
is less than the minimum amount as may be prescribed by the Minister in the case of a licensed person, or the Bank in the case of an approved person.
(2) Every authorized person shall, in carrying on its authorized business, maintain at all times such minimum amount applicable to it.
(3) Notwithstanding subsections (1) and (2), the Minister may grant a licence under section 10 to a person subject to the condition that the person meets the minimum amount in the manner and within the period which are specified by the Bank with the approval of the Minister.
(4) for the purposes of this section,
13 PART III AUTHORIZATION AND REGISTRATION Division 1 Authorized Business-13. Additional conditions of licence or approval.
(1) The Minister, upon the recommendation of the Bank, in the case of a licence granted under section 10, or the Bank in the case of an approval granted under section 11, may at any time in writing amend or revoke any existing condition of an authorization or impose any new conditions thereto.
(2) Any authorized person who fails to comply with any of the conditions imposed by the Minister or the Bank, as the case may be, under subsection (1) or 10(4), paragraph 11(2)(a) or subsection 12(3) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million ringgit or to both.
14 Division 2 Restriction on Dealings of Authorized Persons-14. Authorized person to carry on authorized business only.
(1) Unless the Bank otherwise specifies, an authorized person shall not carry on any business or activity in or outside Malaysia except in connection with or for the purposes of its authorized business or as provided in section 15.
(2) Notwithstanding subsection (1) and subject to paragraphs 15(1) (d) and (e) , an approved operator of a payment system or approved issuer of a designated payment instrument which is not a licensed person may carry on any business or activity which is not in connection with or for the purposes of its approved business.
(3) Except with the prior written approval of the Bank:
(a) a licensed insurer shall not carry on annuity certain business, financial guarantee insurance business or credit guarantee insurance business; and
(b) a licensed investment bank shall not accept money on deposit which is repayable on demand by cheques, drafts, orders or a
16 Division 2 Restriction on Dealings of Authorized Persons-16. Licensed insurer to carry on life or general business.
(1) A licensed insurer, other than a licensed professional reinsurer, shall not carry on both life business and general business.
(2) Notwithstanding subsection (1), a licensed life insurer may carry on the business of insuring solely against disease or sickness or solely against medical expenses subject to such requirements and conditions as may be specified by the Bank.
(3) Any licensed insurer who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
17 Division 3 Registered Business-17. Registered business to be carried on by registered person.
(1) No person shall carry on registered business unless it has:
(a) fulfilled such requirements and submitted such documents or information as may be prescribed by the Bank; and
(b) notified the Bank in writing of the date of commencement of its business.
(2) Subsection (1) shall not apply in respect of adjusting business to:
(a) an advocate, solicitor or a member of any other profession who acts or assists in adjusting insurance or takaful claims incidental to his practice and who does not hold himself out as an adjuster;
(b) an adjuster of aviation or maritime losses; or
(c) an employee of a licensed insurer or licensed takaful operator under the Islamic Financial Services Act 2013, who in the course of his employment, acts or assists in adjusting insurance or takaful claims and who does not hold himself out as an adjus
18 Division 3 Registered Business-18. Registered person to comply with standards.
(1) A person is a registered person if such person has complied with subsection 17(1) and has commenced its registered business.
(2) The Bank may specify standards for registered persons and a registered person shall at all times comply with such standards.
19 Division 4 Representative Office-19. Requirements for representative office.
(1) No foreign institution shall:
(a) establish a representative office in Malaysia unless it has obtained the prior written approval of the Bank; or
(b) through its approved representative office, carry on any authorized or registered business in Malaysia.
(2) Subject to the prohibition under paragraph (1) (b) , a foreign institution may carry on, through its approved representative office, only such activities as may be specified by the Bank.
(3) An application to establish a representative office shall be made in writing to the Bank together with such documents or information as may be specified by the Bank.
(4) The Bank may on an application having been duly made in accordance with subsection (3) approve the application, with or without conditions, or reject the application.
(5) The Bank may at any time in writing amend or revoke any existing conditi
20 Division 5 Revocation, Deregistration, Surrender or Cessation of Business or Operations-20. Grounds for revocation of authorization.
(1) The Minister may, on the recommendation of the Bank, revoke the licence of a licensed person, and the Bank may revoke the approval of an approved person, on the grounds that:
(a) the Bank has, in connection with the application under section 9, been provided with false, misleading, inaccurate or incomplete information;
(b) the person has not commenced the business in respect of which it is licensed or approved within the period specified by the Minister under subsection 10(6) or by the Bank under subsection 11(5);56
(c) the person has ceased to carry on business for which it is licensed or approved;
(d) the person has:
(i) breached or contravened any provision of this Act or the Central Bank of Malaysia Act 2009;
(ii) failed to comply with any condition of its licence or approval; or
(iii) failed to comply with any direction issued
21 Division 5 Revocation, Deregistration, Surrender or Cessation of Business or Operations-21. Grounds for deregistration.
The Bank may deregister a registered person if:
(a) the person has provided the Bank with false, misleading, inaccurate or incomplete information for the purposes of subsection 17(1);
(b) the person has ceased to carry on business for which it is registered;
(c) the person has:
(i) breached or contravened any provision of this Act or the Central Bank of Malaysia Act 2009; or
(ii) failed to comply with any specification or standards under this Act,
regardless that there has been no prosecution or other action in respect of such breach, contravention or non-compliance;
(d) the shareholder, director or any person concerned with the operation or management of the registered person has been convicted of an offence under this Act or an offence involving fraud or dishonesty under any other written law; or
(e) the
22 Division 5 Revocation, Deregistration, Surrender or Cessation of Business or Operations-22. Surrender of licence or notification on cessation of business or operations.
(1) A licensed person may surrender its licence to the Bank and upon surrendering, the licensed person shall provide a written notice of its surrender to the Bank.
(2) An approved person or a registered person, as the case may be, shall submit a written notice to the Bank if it ceases to carry on its business.
(3) An approved representative office shall submit a written notice to the Bank if it ceases operations.
(4) The surrender under subsection (1) or the notification under subsection (2) or (3) shall take effect on the date the Bank receives such notice or where a later date is specified in the notice, on that date.
(5) The Bank:
(a) shall publish in the Gazette , as soon as practicable, a notice of a surrender of a licence under subsection (1); or
(b) may publish a notice of cessation of business under subsection (2) or cessation of operations under subsection (
23 Division 5 Revocation, Deregistration, Surrender or Cessation of Business or Operations-23. Effect of revocation, deregistration, surrender, notification on cessation of business or operations, and expiry.
(1) Where:
(a) the Minister revokes a licence of a licensed person under section 20;
(b) the Bank:
(i) revokes an approval of an approved representative office under subsection 19(6) or (7) or an approved person under section 20; or
(ii) deregisters a registered person under section 21;
(c) a surrender of a licence by a licensed person or notification by an approved person or registered person on the cessation of its business or an approved representative office on the cessation of its operations has taken effect under subsection 22(4); or
(d) an approval granted to an approved person under section 11 has expired,
such person or representative office shall immediately cease to carry on its business or operations, as the case may be.
(2) Notwithstanding the revocation, deregistration, surrender, notifi
24 Division 6 General Matters-24. form of establishment.
(1) A person who is to be licensed under section 10 to carry on banking business, insurance business (other than a person who is to be a professional reinsurer) or investment banking business shall be a public company.
(2) The Bank may specify the form of establishment of:
(a) a person who is to be licensed as a professional reinsurer; or
(b) a person who is to be approved under section 11 to carry on an approved business.
25 Division 6 General Matters-25. Establishment or relocation of office of authorized persons.
(1) Unless otherwise specified by the Bank, no licensed person shall establish or relocate an office in or outside Malaysia without the prior written approval of the Bank.
(2) Where an approved person establishes or relocates an office in or outside Malaysia, such approved person shall notify the Bank in writing within such period as may be specified by the Bank.
26 Division 6 General Matters-26. Fees.
(1) Regulations may be made under section 260 to prescribe:
(a) any fee to be paid by an authorized person or a registered person in respect of its authorization or registration, establishment of any office or the annual fee; and
(b) a processing fee to be paid by an applicant for authorization under section 9 or a person who has complied with paragraph 17(1) (a) ,
of such amount, or calculated at such rate or in such manner as set out in the regulations.
(2) Any fee paid to the Bank under this section shall be paid into and form part of the Federal Consolidated Fund.
(3) Any unpaid fees may be sued for and recovered as a civil debt due to the Government and in addition, the court may order for a payment of a penalty for late payment up to an amount equivalent to twice the amount of the fees unpaid and costs of recovering the amount including but not limited to
27 Division 6 General Matters-27. Publication of names of authorized persons and registered persons.
(1) The Bank shall, from time to time, publish in the Gazette a list of all licensed persons and any additions to or deletions from the list.
(2) The Bank shall, from time to time, publish a list of approved persons and registered persons in such form as the Bank deems appropriate.
28 Division 6 General Matters-28. Holding out as authorized person or registered person.
(1) No person shall hold himself out to be:
(a) an authorized person unless he is authorized; or
(b) a registered person unless he is registered,
under this Act.
(2) Any person who contravenes paragraph (1) (a) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
(3) Any person who contravenes paragraph (1) (b) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
29 Division 6 General Matters-29. Acting on behalf of unlicensed person.
(1) No person shall act on behalf of a foreign institution or any person who is not licensed under this Act in relation to carrying on banking business, investment banking business, insurance business or accepting deposits in Malaysia unless approved in writing by the Bank.
(2) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
30 PART IV PAYMENT SYSTEMS Division 1 Designation of Payment Systems and Payment Instruments-30. Designation and revocation of designation of payment systems.
(1) Where the Bank is of the opinion that a disruption in the operations of the payment system could affect public confidence in the overall payment systems of Malaysia or impact the monetary or financial stability of Malaysia:
(a) in the case of an operator of a payment system who is subject to the supervision or oversight of another supervisory authority in Malaysia, the Minister on the recommendation of the Bank and such supervisory authority; or
(b) in any other case, the Bank with the concurrence of the Minister,
may, by an order published in the Gazette , designate such payment system as a designated payment system.
(2) In the case of an operator of a payment system who is subject to the supervision or oversight of another supervisory authority in Malaysia, the Bank shall consult with such supervisory authority in forming an opinion under subsection (1).
31 PART IV PAYMENT SYSTEMS Division 1 Designation of Payment Systems and Payment Instruments-31. Designation of payment instruments.
Where the Bank is of the opinion that:
(a) a payment instrument may be of widespread use as a means of making payment and may affect the payment systems in Malaysia; and
(b) it is necessary to maintain the integrity, efficiency and reliability of the payment instrument,
the Bank may, with the concurrence of the Minister, by an order published in the Gazette , designate such payment instrument as a designated payment instrument.
32 Division 2 Requirements for Operation of Payment Systems and Issuance of Designated Payment Instruments-32. Application of this Act on payment systems.
Unless otherwise prescribed by the Bank, this Act shall apply to a person outside Malaysia who is an operator of a payment system which accepts payment instructions or settlement instructions from participants in Malaysia.
33 Division 2 Requirements for Operation of Payment Systems and Issuance of Designated Payment Instruments-33. Power of Bank to specify standards for payment systems.
(1) The Bank may specify standards for payment systems:
(a) for promoting safety, integrity, efficiency or reliability of the designated payment system, the payment system set out in Division 1 of Part 1 of Schedule 1, the payment system set out in paragraph 9 of Part 2 of Schedule 1 or the designated payment instrument including facilitating interoperability, technical specifications and security standards; or
(b) in the interest of current or prospective participants of the designated payment system, the payment system set out in Division 1 of Part 1 of Schedule 1 or the payment system set out in paragraph 9 of Part 2 of Schedule 1 or users.
(2) An operator of a designated payment system, an approved operator of a payment system, a registered operator of a payment system or an approved issuer of a designated payment instrument shall at all times comply with the standards specified b
34 Division 2 Requirements for Operation of Payment Systems and Issuance of Designated Payment Instruments-34. Direction to participants of designated payment system.
The Bank may issue directions in writing to any participant of a designated payment system if the Bank is of the opinion that it is necessary for ensuring the integrity and proper management of the designated payment system or it is in the interest of the public to do so.
35 Division 2 Requirements for Operation of Payment Systems and Issuance of Designated Payment Instruments-35. Operational arrangements.
(1) An operator of a designated payment system, approved operator of a payment system or approved issuer of a designated payment instrument shall establish the following operational arrangements:
(a) rules, procedures and requirements setting out the rights, liabilities or any other obligations of:
(i) the operator and participants of the designated payment system;
(ii) the approved operator of a payment system and its participants; and
(iii) the approved issuer of a designated payment instrument and its users,
including the risks that such participants or users may incur; and
(b) measures to ensure the safety, security and operational reliability of the designated payment system, payment system set out in Division 1 of Part 1 of Schedule 1 or the designated payment instrument including contingency arrangements.
(2) In additio
36 Division 2 Requirements for Operation of Payment Systems and Issuance of Designated Payment Instruments-36. Power of Bank to inspect.
The Bank may, in considering whether:
(a) to designate or recommend to the Minister to designate a payment system under section 30;
(b) to designate a payment instrument under section 31;
(c) to recommend to the Minister to include an operation of a payment system into Division 1 of Part 1 of Schedule 1 under section 264; or
(d) to recommend to the Minister to include an operation of a payment system into Part 2 of Schedule 1 under section 264,
inspect the premises, apparatus, equipment, machinery, documents and transactions relating to the payment system or payment instrument, upon giving a written notice to the operator or issuer.
37 Division 3 Finality of Payment and Netting Arrangement-37. Interpretation.
for the purposes of this Division:
"certificate of finality" means a certificate issued by the Bank to any designated payment system under section 38;
"certified designated payment system" means a designated payment system that has been issued a certificate of finality by the Bank which may include a payment system operated by the Bank, or by any body corporate established or acquired by the Bank under the Central Bank of Malaysia Act 2009 or by any person authorized by the Bank;
"insolvency administrator" includes a receiver, manager, receiver and manager, liquidator, provisional liquidator, judicial manager, curator, special administrator or any other person, however styled, authorized under any law in or outside Malaysia to take control of a person's property for the benefit of that person's credi 38 Division 3 Finality of Payment and Netting Arrangement-38. Power of Bank to issue certificate of finality.
The Bank may, with the concurrence of the Minister, by an order published in the Gazette , issue a certificate of finality to a designated payment system where the following criteria are met:
(a) the payment system poses or is likely to pose a systemic risk;
(b) the settlement of transfer order is effected within the designated payment system itself; and
(c) the operator of the payment system has complied with the requirements as may be specified by the Bank.
39 Division 3 Finality of Payment and Netting Arrangement-39. Revocation of certificate of finality.
The Bank may, with the concurrence of the Minister, by an order published in the Gazette , revoke a certificate of finality if the Bank is of the opinion that:
(a) any of the criteria specified in section 38 is no longer met; or
(b) the operator of the certified designated payment system has breached or contravened any provision of this Act.
40 Division 3 Finality of Payment and Netting Arrangement-40. Application of this Division.
(1) The provisions of this Division shall apply to:
(a) any transfer order sent through a certified designated payment system; and
(b) any netting arrangement, in respect of claims or obligations arising from a transfer order that is final under subsection 42(1), entered into between an operator and a participant or between participants only in respect of a certified designated payment system.
(2) Any written law relating to bankruptcy and insolvency shall continue to apply, but where there is any conflict or inconsistency between the provisions of this Division and the written law relating to bankruptcy and insolvency, the provisions of this Division shall prevail.
41 Division 3 Finality of Payment and Netting Arrangement-41. Transfer order made after appointment of insolvency administrator.
This Division shall not apply in relation to any transfer order which is sent through a certified designated payment system after the expiry of the day on which an insolvency administrator is appointed in respect of an operator or a participant of a certified designated payment system.
42 Division 3 Finality of Payment and Netting Arrangement-42. Finality of payment and netting arrangement.
(1) A transfer order shall be valid and enforceable by and against an operator or a participant of a certified designated payment system and shall be final and shall not be revoked, reversed or set aside by any person from the time the transfer order is determined to be final under the rules of the certified designated payment system required to be established under paragraph 35(2) (a) and no order shall be made by any court for the rectification or stay of such transfer order.
(2) A netting arrangement shall be valid and enforceable and an operator or a participant of a certified designated payment system shall do whatever is permitted or required under the netting arrangement in order to give effect to the netting arrangement.
(3) Any payment or settlement obligations owed to an operator or a participant of a certified designated payment system under the netting arrangement that has not been discharged:
43 Division 3 Finality of Payment and Netting Arrangement-43. Preservation of rights.
for the avoidance of doubt, the provisions of this Division shall not restrict or preclude any person from enforcing his rights under the law in so far as it does not affect the finality of the transfer order or the validity and enforceability of a netting arrangement under this Division.
44 Division 3 Finality of Payment and Netting Arrangement-44. Non-recognition of insolvency order by foreign court.
Notwithstanding any other written law, a court shall not recognize or give effect to an order of a foreign court exercising jurisdiction under any law of insolvency outside Malaysia in so far as the making of the order would be inconsistent with or contrary to the provisions of this Division.
45 Division 3 Finality of Payment and Netting Arrangement-45. Requirement to notify in event of insolvency, etc.
(1) Where an operator of a certified designated payment system:
(a) is insolvent or is likely to become insolvent;
(b) has become or is likely to become unable to meet any or all of its obligations; or
(c) has suspended payments or compounded with its creditors,
such operator shall immediately notify the participants of the certified designated payment system.
(2) Where a participant of a certified designated payment system:
(a) is insolvent or is likely to become insolvent;
(b) has become or is likely to become unable to meet any or all of its obligations; or
(c) has suspended payments or compounded with its creditors,
such participant shall immediately notify the operator who shall notify the other participants of the certified designated payment system.
(3) Any per
46 PART V PRUDENTIAL REQUIREMENTS-46. Interpretation.
for the purposes of Divisions 1, 2, 3 and 4, "institution" refers to an authorized person or operator of a designated payment system.
47 Division 1 Standards On Prudential Matters-47. Power of Bank to specify standards on prudential matters.
(1) The Bank may specify standards on prudential matters to promote:
(a) the sound financial position of an institution; or
(b) integrity, professionalism and expertise in the conduct of the business, affairs and activities of an institution.
(2) Without limiting the generality of subsection (1), standards specified under that subsection may include standards relating to:
(a) capital adequacy;
(b) liquidity;
(c) corporate governance;
(d) risk management;
(e) related party transactions;
(f) maintenance of reserve funds;
(g) insurance funds; and
(h) prevention of an institution from being used, intentionally or unintentionally, for criminal activities.
(3) for purposes of paragraph (2) (e) , "related party trans
48 Division 1 Standards On Prudential Matters-48. Institution, director and officer to comply with standards.
(1) Every institution shall at all times:
(a) comply with the standards as may be specified by the Bank under subsection 47(1) which are applicable to such institution;
(b) ensure that its internal policies and procedures are consistent with the standards as may be specified by the Bank under subsection 47(1); and
(c) whether or not standards have been specified by the Bank under subsection 47(1), manage its business, affairs and activities in a manner consistent with sound risk management and governance practices which are effective, accountable and transparent.
(2) Every director and officer of an institution shall at all times comply with the internal policies and procedures adopted by such institution including internal policies and procedures to implement the standards as may be specified by the Bank under subsection 47(1).
49 Division 1 Standards On Prudential Matters-49. Registered operator of payment system to comply with standards.
The Bank may require a registered operator of a payment system to comply with all or any standards as may be specified by the Bank under subsection 47(1), or any part of such standards, with such amendments as the Bank deems necessary, if the Bank is of the opinion that it is necessary to promote public confidence in, or for the safety, reliability and efficiency of, the payment systems of Malaysia.
50 Division 1 Standards On Prudential Matters-50. Single counterparty exposure limit for licensed person.
(1) No licensed person shall have an exposure to a single counterparty which exceeds the limit as may be specified by the Bank under subsection 47(1).
(2) An exposure to a single counterparty referred to in subsection (1) shall include an exposure to any group of persons connected to such single counterparty but shall not include any exposure to, and any exposure explicitly guaranteed by, the Bank or the Government.
(3) for the purposes of this section, the Bank may specify what constitutes "connected", "counterparty" or "exposure".
51 Division 1 Standards On Prudential Matters-51. Restriction on payment of dividend by licensed person.
(1) No licensed person shall declare or pay any dividend on its shares except with the prior written approval of the Bank or where the Bank has specified standards permitting the declaration of payments of any dividend under subsection 47(1).
(2) Where there is an application made by a licensed person for approval under subsection (1) in respect of the proposed amount of dividend to be declared, the Bank shall, in considering whether or not to grant an approval on the proposed amount or approve a reduced amount of dividend payment, have regard to the prevailing and prospective financial condition of the licensed person including its ability to comply with any standards as may be specified by the Bank under paragraph 47(2) (a) .
52 Division 1 Standards On Prudential Matters-52. Maintenance of assets in Malaysia by licensed person.
The Bank may require a licensed person to hold at all times all or such part of its assets, as may be specified by the Bank, in Malaysia.
53 Division 2 Corporate Governance-53. Interpretation.
for the purposes of this Division,
"chairman" means chairman of the board of directors. 54 Division 2 Corporate Governance-54. Chairman, directors and chief executive officer of institution.
(1) Every institution shall at all times have a chief executive officer.
(2) Except with the prior written approval of the Bank:
(a) no licensed person shall appoint or elect, or reappoint or re-elect any person as its chairman, director or chief executive officer; and
(b) no person shall accept any appointment or election, or reappointment or re-election as a chairman, director or chief executive officer, of a licensed person.
(3) The licensed person shall submit an application in writing to the Bank together with such documents or information as may be specified by the Bank for the purposes of an approval under subsection (2).
(4) An approved person or operator of a designated payment system shall notify the Bank in writing of the appointment, reappointment, election or re-election of its chairman, director or chief executive officer and in the case of an approved fi
55 Division 2 Corporate Governance-55. Requirements to be chairman, director, chief executive officer or senior officer.
(1) An institution shall not appoint or elect, reappoint or re-elect any person as a chairman, director, chief executive officer or senior officer of the institution, unless such person:
(a) is an individual;
(b) is not disqualified under subsection 59(1); and
(c) has complied with the fit and proper requirements as may be specified by the Bank under section 60.
(2) No person shall accept any appointment or election, reappointment or re-election as a chairman, director, chief executive officer or senior officer of an institution, unless such person:
(a) is not disqualified under subsection 59(1); and
(b) has complied with the fit and proper requirements as may be specified by the Bank under section 60.
(3) Unless the Bank otherwise approves, a chief executive officer of an institution shall have his
56 Division 2 Corporate Governance-56. Functions and duties of board of directors.
(1) The business and affairs of an institution shall be managed under the direction and oversight of its board of directors, subject to this Act and any other written law which may be applicable to the institution.
(2) Without limiting the generality of subsection (1), the board of directors shall:
(a) set and oversee the implementation of business and risk objectives and strategies and in doing so shall have regard to the long term viability of the institution and reasonable standards of fair dealing;
(b) ensure and oversee the effective design and implementation of sound internal controls, compliance and risk management systems commensurate with the nature, scale and complexity of the business and structure of the institution;
(c) oversee the performance of the senior management in managing the business and affairs of the institution;
(d) ensure that there is a r
57 Division 2 Corporate Governance-57. Duties of directors.
(1) A director of an institution shall at all times:
(a) act in good faith in the best interests of the institution;
(b) exercise reasonable care, skill and diligence with:
(i) the knowledge, skill and experience which may reasonably be expected of a director having the same responsibilities; and
(ii) any additional knowledge, skill and experience which the director has;
(c) only exercise powers conferred on him for the purposes for which such powers are conferred; and
(d) exercise sound and independent judgment.
(2) Subsection (1) has effect in addition to, and not in derogation of, any written law or rule of law relating to the duty or liability of a director.
(3) Any director who contravenes paragraph (1) (c) commits an offence and shall, on conviction, be liable to imprisonment for a term
58 Division 2 Corporate Governance-58. Duty to disclose interests in material transaction or material arrangement.
(1) A director of an institution shall disclose to the board of directors of the institution the nature and extent of his interest, whether directly or indirectly, in a material transaction or material arrangement with the institution.
(2) Whether or not a declaration under subsection (1) has been made, a director who has, directly or indirectly, an interest in a material transaction or material arrangement shall not be present at the board meeting where the material transaction or material arrangement is being deliberated by the board of directors.
(3) Where there is any change in the nature and extent of a director's interest in a material transaction or material arrangement subsequent to the disclosure pursuant to subsection (1), the director shall make a further disclosure of such changes in accordance with subsection (1).
(4) for the purposes of subsection (1), the Bank may specify:
(a) the tim
59 Division 2 Corporate Governance-59. Disqualifications.
(1) A person is disqualified from being appointed or elected, reappointed or re-elected, accepting any appointment or election, or holding office, as a chairman, director, chief executive officer or senior officer of an institution if:
(a) he is an undischarged bankrupt, has suspended payments or has compounded with his creditors whether in or outside Malaysia;
(b) a charge for a criminal offence relating to dishonesty or fraud under any written law or the law of any country, territory or place outside Malaysia, has been proven against him;
(c) he is prohibited from being a director of a company or in any way, whether directly or indirectly, be concerned or take part in the management of a company in Malaysia pursuant to a court order made under section 130A of the Companies Act 1965 and has not obtained any leave of the court under the same section; or
(d) under any law r
60 Division 2 Corporate Governance-60. Fit and proper requirements.
(1) Without limiting the generality of section 47 and for the purposes of paragraphs 55(1) (c) and 55(2) (b) , the Bank may specify fit and proper requirements to be complied with by a chairman, director, chief executive officer or senior officer of an institution or a financial adviser's representative, which may include minimum criteria relating to:
(a) probity, personal integrity and reputation;
(b) competency and capability; and
(c) financial integrity.
(2) Where an issue arises as to whether a chairman, director, chief executive officer, senior officer or financial adviser's representative has complied with the fit and proper requirements as specified under subsection (1), the Bank shall have full discretion to determine the issue.
61 Division 2 Corporate Governance-61. Cessation from office.
(1) Where a chairman, director, chief executive officer or senior officer of an institution or a financial adviser's representative, as the case may be:
(a) becomes disqualified under subsection 59(1); or
(b) no longer complies with any of the fit and proper requirements as may be specified by the Bank under section 60,
such chairman, director, chief executive officer, senior officer or financial adviser's representative shall immediately cease to hold office and act in such capacity.
(2) The institution shall immediately:
(a) in the case of paragraph (1) (a) , terminate the appointment of such chairman, director, chief executive officer, senior officer or financial adviser's representative; or
(b) in the case of paragraph (1) (b) , remove such chairman, director, chief executive officer, senior officer or financial
62 Division 2 Corporate Governance-62. Notice of cessation from office.
An institution shall notify the Bank in writing of the fact that a person has ceased to be its chairman, director, chief executive officer, senior officer or financial adviser's representative, as the case may be, pursuant to this Division or under any other circumstances and of the reasons for the cessation within seven days from the date of such cessation.
63 Division 3 Transparency Requirements-63. Interpretation.
for the purposes of this Division:
"accounting records" has the same meaning assigned to it in subsection 4(1) of the Companies Act 1965;
"approved accounting standards" has the same meaning assigned to it in section 2 of the Financial Reporting Act 1997 [Act 558] ;
"financial statements" has the same meaning as set out in the approved accounting standards issued or approved by the Malaysian Accounting Standards Board under the Financial Reporting Act 1997. 64 Division 3 Transparency Requirements-64. Maintenance of accounting records and information.
An institution shall maintain or cause to be maintained proper accounting records and information in such manner as will sufficiently enable the institution to prepare its financial statements under section 65 and shall cause those records to be kept in such manner as to enable them to be conveniently and properly audited.
65 Division 3 Transparency Requirements-65. Compliance with approved accounting standards.
An institution shall prepare its financial statements in accordance with:
(a) the approved accounting standards subject to any standards as may be specified by the Bank under subsection 47(1); or
(b) in the absence of any approved accounting standards, any standards as may be specified by the Bank under subsection 47(1).
66 Division 3 Transparency Requirements-66. Publication of financial statements.
(1) An institution shall publish its financial statements prepared under section 65 from time to time subject to any standards as may be specified by the Bank under subsection 47(1).
(2) Notwithstanding subsection (1), the Bank may require that the financial statements shall be audited before any publication under subsection (1). Financial
67 Division 4 Auditors-67. Appointment of auditor by institution.
(1) Every institution shall appoint an auditor for each financial year who meets such requirements or has such qualifications set out in any standards as may be specified by the Bank under subsection 47(1).
(2) Except with the prior written approval of the Bank, no licensed person shall appoint any person as its auditor and no person shall accept any appointment as an auditor of a licensed person.
(3) An approved person or operator of a designated payment system shall notify the Bank of the appointment of its auditor within such period as may be determined by the Bank.
(4) for the purposes of this Division:
(a) a person shall not be deemed to be an officer of an institution by reason only of him having been appointed as an auditor of the institution; and
(b) the term "appointment" includes reappointment.
68 Division 4 Auditors-68. Appointment of auditor by Bank.
Without prejudice to section 67, the Bank may appoint an auditor for an institution:
(a) if the institution fails to appoint an auditor as required under subsection 67(1); or
(b) to act with an existing auditor of the institution appointed under subsection 67(1),
and the remuneration and expenses relating to such appointment shall be borne by the institution.
69 Division 4 Auditors-69. Duties of auditor.
(1) An auditor appointed under this Division shall:
(a) carry out an audit of the business, affairs and books of the institution;
(b) submit a report of such audit to the members of the institution and the Bank;
(c) submit any additional information as may be specified by the Bank relating to the audit conducted under paragraph (a) ;
(d) expand or extend the scope of the audit conducted under paragraph (a) within such time, in such manner or to such extent as may be specified by the Bank; or
(e) carry out any specific assessment of the business, affairs and books of the institution as may be specified by the Bank and submit a report to the Bank on such assessment.
(2) The remuneration and expenses of the auditor relating to any expanded or extended scope of audit under paragraph (1)(d) or any specific assessment under
70 Division 4 Auditors-70. Notice of cessation as auditor.
Where during the course of an audit on an institution, an auditor appointed under section 67 or 68 has ceased to be an auditor of an institution, the auditor shall notify the Bank in writing of that fact and the reasons of such cessation within seven days from the date of such cessation.
71 Division 4 Auditors-71. Information to be provided to auditor.
An institution and any director, officer or controller of that institution shall:
(a) provide the auditor appointed under section 67 or 68 all information within its or his knowledge or capable of being obtained by it or him which the auditor may require; and
(b) ensure that all such information provided under paragraph (a) is accurate, complete, not false or misleading in any material particular,
to enable the auditor to carry out his duties under this Act.
72 Division 4 Auditors-72. Reporting obligations of auditor.
An auditor shall report such matter to the Bank immediately in writing if, in the course of carrying out his duties as an auditor of an institution under this Act, he is satisfied that:
(a) there has been a breach or contravention of any provision of this Act or a non-compliance of any standards as may be specified by the Bank under this Act which may have a material effect on the financial position of the institution;
(b) an offence involving fraud or dishonesty under any written law has been committed by the institution or by any director or officer of the institution;
(c) any irregularity which may have a material effect on the financial position of the institution, including any irregularity which jeopardizes or may jeopardize the interests of the depositors, policy owners, creditors of the institution, participants or users, or any other serious irregularity, has occurred;
73 Division 4 Auditors-73. Qualified privilege and duty of confidentiality.
(1) Subsection 133(1) shall not apply to any documents or information relating to the affairs or account of any customer of a financial institution subject to such conditions as may be specified by the Bank, disclosed by an auditor of a financial institution to the Audit Oversight Board established under the Securities Commission Act 1993 [Act 498] or an officer or other person authorized in writing by the Audit Oversight Board to perform the responsibilities of the Audit Oversight Board.
(2) An auditor of an institution shall not be liable:
(a) for a breach of a duty of confidentiality between the auditor and the institution in respect of any reporting to the Bank done in good faith under this Division; or
(b) to be sued in any court for defamation in respect of any statement made by the auditor without malice in the discharge of his duties under this Act.
74 Division 5 Appointed Actuaries-74. Appointment of actuary by licensed insurer.
(1) Every licensed insurer shall appoint an actuary in respect of a life or general business carried on by the licensed insurer.
(2) Any actuary to be appointed under subsection (1) shall meet such requirements or have such qualifications set out in any standards as may be specified by the Bank under subsection 47(1).
(3) Except with the prior written approval of the Bank, no licensed insurer shall appoint any person as its actuary under subsection (1) and no person shall accept such appointment.
(4) An appointment under subsection (1) shall be for each financial year or such longer period as approved by the Bank.
75 Division 5 Appointed Actuaries-75. Appointment of actuary by Bank.
Without prejudice to section 74, the Bank may appoint an actuary for a licensed insurer if the licensed insurer fails to appoint an actuary as required under subsection 74(1) and the remuneration and expenses relating to such appointment shall be borne by the licensed insurer.
76 Division 5 Appointed Actuaries-76. Duties of appointed actuary.
An appointed actuary shall have such duties and functions set out in any standards as may be specified by the Bank under subsection 47(1).
77 Division 5 Appointed Actuaries-77. Cessation as appointed actuary.
A person shall cease to be the appointed actuary of a licensed insurer if:
(a) such person resigns from office;
(b) the licensed insurer terminates his appointment; or
(c) such person, in the opinion of the Bank, no longer meets the requirements or cease to have the qualifications as may be specified by the Bank under subsection 74(2).
78 Division 5 Appointed Actuaries-78. Notice of cessation as appointed actuary.
(1) Where a person ceases to be an appointed actuary of a licensed insurer under section 77, such person shall notify the Bank in writing of that fact and the reasons of such cessation not later than seven days from the date of such cessation.
(2) Where a person ceases to be the appointed actuary of a licensed insurer under subsection (1), such insurer shall appoint another person as its appointed actuary under subsection 74(1) not later than such period as may be specified by the Bank from the date of the cessation.
79 Division 5 Appointed Actuaries-79. Information to be provided to appointed actuary.
A licensed insurer and any director, officer or controller of such licensed insurer shall:
(a) provide the appointed actuary all information within its or his knowledge or capable of being obtained by it or him which the appointed actuary may require; and
(b) ensure that all such information provided under paragraph (a) is accurate, complete, not false or misleading, in any material particular,
to enable the appointed actuary to carry out his duties and functions under this Act.
80 Division 5 Appointed Actuaries-80. Qualified privilege and duty of confidentiality.
An appointed actuary shall not be liable:
(a) for a breach of a duty of confidentiality between the appointed actuary and a licensed insurer in respect of:
(i) any reporting to the Bank; or
(ii) the discharge of his duties and performance of his functions,
pursuant to any standards as may be specified under subsection 47(1) which was done or made in good faith; or
(b) to be sued in any court for defamation in respect of any statement made by the appointed actuary without malice in the discharge of his duties under this Act.
81 Division 6 Insurance Funds-81. Establishment and maintenance of insurance funds.
(1) A licensed insurer shall establish and maintain one or more insurance funds for any class or description of its insurance business as may be specified by the Bank.
(2) Notwithstanding subsection (1), a licensed life insurer shall establish and maintain a separate insurance fund for its life insurance business relating to participating life policies.
(3) The Bank may specify that a licensed life insurer shall establish and maintain more than one insurance fund for its participating life policies under subsection (2).
82 Division 6 Insurance Funds-82. Requirements relating to insurance funds.
(1) A licensed insurer shall:
(a) pay into an insurance fund all receipts in respect of policies to which the insurance fund relates and which are issued by it or under which it has undertaken liability, including all income of that insurance fund;
(b) maintain at all times assets in an insurance fund of a value equivalent to or higher than the liabilities of that insurance fund;
(c) apply the assets of an insurance fund only to meet the liabilities and expenses properly incurred by that insurance fund; and
(d) comply with such other requirements as may be specified by the Bank under paragraph 47(2) (g) including requirements on the types of assets to be, or not to be, included as assets of the insurance fund.
(2) for the purposes of subsection (1), the Bank may specify what constitutes "receipts", "income", "liabilities" or "expenses" and the
83 Division 6 Insurance Funds-83. Withdrawal from insurance funds.
A licensed insurer shall not make any withdrawal from an insurance fund, whether from the surplus or otherwise of that insurance fund, unless:
(a) it has complied with such requirements on withdrawals as may be specified by the Bank;
(b) the withdrawal does not impair the sustainability of the insurance fund to meet its liabilities; and
(c) in respect of an insurance fund for participating life policies, the interests and fair treatment of policy owners, including their reasonable expectations, have been given due regard.
84 Division 6 Insurance Funds-84. Assumption of risk.
(1) No licensed insurer shall assume any risk in respect of such description of policy as may be prescribed by the Bank unless and until the premium payable is received by the licensed insurer in such manner and within such time as may be prescribed by the Bank.
(2) Where the premium payable under subsection (1) is received by a person on behalf of a licensed insurer, the receipt shall be deemed to be receipt by the licensed insurer for the
purpose of that subsection and the onus of proving that the premium was received by a person who was not authorized to receive the premium shall lie on the licensed insurer.
85 Division 7 Subsidiaries-85. Establishment or acquisition of subsidiaries and acquisition or holding of material interest in corporation.
(1) No authorized person shall:
(a) establish or acquire a subsidiary in or outside Malaysia; or
(b) acquire or hold any material interest in any corporation,
without the prior written approval of the Bank.
(2) The Bank may specify what constitutes "material interest" for the purposes of paragraph (1) (b) .
86 PART VI OWNERSHIP, CONTROL AND TRANSFER OF BUSINESS-86. Application and non-application.
(1) Divisions 1 and 2 shall apply to a licensed person incorporated in Malaysia.
(2) Sections 87, 88, 89, 99 and 100 shall not apply to the Malaysia Deposit Insurance Corporation, its subsidiary, bridge institution or any person appointed under paragraph 99(1) (c) or section 106 of the Malaysia Deposit Insurance Corporation Act 2011, where such person is exercising its powers under that Act.
87 Division 1 Interest in Shares of Licensed Person-87. Acquisition of interest in shares requiring approval.
(1) Subject to section 92 and except with the prior written approval of the Bank, no person:
(a) shall enter into an agreement or arrangement, to acquire any interest in shares of a licensed person by which, if the agreement or arrangement is carried out, he would hold (together with any interest in shares of that licensed person which are already held by such person) an aggregate interest of five per cent or more in the shares of the licensed person; or
(b) who has obtained an approval of the Bank under paragraph 90(3) (a) , or the Minister under subsection 90(6) in respect of the prohibition under subsection (2), as the case may be, shall enter into any subsequent agreement or arrangement, by which, if the agreement or arrangement is carried out, he would hold an aggregate interest in shares of a licensed person of, or exceeding:
(i) any multiple of five per cent; or
(
88 Division 1 Interest in Shares of Licensed Person-88. Control over licensed person prohibited in some cases.
(1) Subject to subsection (2), no person shall have control over a licensed person, unless such person obtains the prior written approval of the Minister, on the recommendation of the Bank.
(2) Subsection (1) shall not apply to:
(a) any director or chief executive officer of a licensed person in respect of the carrying out of his duties and functions in the management of the licensed person; and
(b) a person who has obtained an approval of the Minister under subsection 90(6) to hold more than fifty per cent of the interest in shares of the licensed person.
89 Division 1 Interest in Shares of Licensed Person-89. Disposal of interest in shares requiring approval.
Except with the prior written approval of the Minister, on the recommendation of the Bank, no person who has an aggregate interest in shares of a licensed person of:
(a) more than fifty per cent; or
(b) fifty per cent or less but has control over the licensed person,
shall enter into an agreement or arrangement to dispose any interest in shares of a licensed person by which, if the agreement or arrangement is carried out, such disposal would result in the person holding an interest in shares of less than fifty per cent or in any way ceasing to have control over the licensed person.
90 Division 1 Interest in Shares of Licensed Person-90. Application procedures for section 87, 88 or 89.
(1) An application for an approval of:
(a) the Bank under subsection 87(1); or
(b) the Minister under subsection 87(2) or 88(1), or section 89,
as the case may be, shall be made by submitting the application to the Bank together with such documents or information as may be specified by the Bank.
(2) In assessing the suitability of an applicant for the purposes of:
(a) granting an approval of the Bank under subsection 87(1); or
(b) recommending to the Minister under subsection 87(2) or 88(1),
the Bank shall take into consideration matters that the Bank considers relevant including any of the factors set out in Schedule 6, and any standards as may be specified by the Bank under subsection 91(1).
(3) Upon making an assessment under subsection (2) and where the Bank is satisfied with the suitability of th
91 Division 1 Interest in Shares of Licensed Person-91. Power of Bank to specify standards on shareholder suitability.
(1) The Bank may specify standards on shareholder suitability to give full effect to Schedule 6.
(2) Any person who has obtained the approval of the Bank under paragraph 90(3) (a) or the Minister under subsection 90(6) in respect of subsection 87(2) or 88(1), shall at all times comply with the standards as may be specified under subsection (1) to the satisfaction of the Bank.
92 Division 1 Interest in Shares of Licensed Person-92. Maximum permissible holdings.
No individual shall hold more than ten per cent of interest in shares of a licensed person.
93 Division 1 Interest in Shares of Licensed Person-93. Notification on acquisition or disposal of interest in shares of licensed person.
(1) Where it comes to the knowledge of a director or an officer of a licensed person or a financial holding company that:
(a) any agreement or arrangement as referred to in section 87 or 89 has been or is about to be effected; or
(b) any person approved by the Bank under paragraph 90(3) (a) or the Minister under subsection 90(6) in respect of subsection 87(2) or 88(1), has failed to comply or is likely to fail to comply with standards as may be specified under subsection 91(1),
the director or officer shall immediately notify the Bank of all such information which is within his knowledge.
(2) No director or officer shall be liable to any action for defamation at the suit of any person or be subject to any disciplinary proceedings in respect of the notification under subsection (1) made by the director or officer without malice.
94 Division 2 Action by Bank in Event of Breach-94. Order against defaulting persons.
(1) Where the Bank is satisfied that any person (in this section referred to as "the defaulting person"):
(a) has breached section 87, 88, 89 or 92;
(b) has failed to comply with any condition imposed pursuant to the approval of the Bank or the Minister, as the case may be, under section 87, 88 or 89; or
(c) has failed to comply with any standards as may be specified by the Bank under subsection 91(1),
the Bank may exercise its powers under subsection (2) as may be applicable or appropriate in the circumstances of the breach or non-compliance.
(2) Subject to section 262, where any of the circumstances described in subsection (1) exists, the Bank may make the following order:
(a) in respect of any shares which are the subject of the breach or non-compliance:
(i) prohibit the transfer of, or the carrying out of
95 Division 2 Action by Bank in Event of Breach-95. Additional provisions relating to order under subparagraph 94(2)(a)(v).
(1) After considering the representation made by the defaulting person under section 262 and where the Bank confirms an order made under subparagraph 94(2) (a) (v), the Bank may dispose of the shares surrendered to it pursuant to the order made under that subparagraph to such persons and to such extent as shall be consistent with the same being held lawfully by the person who acquires the shares under this Act.
(2) The proceeds of the disposal of the shares under subsection (1) shall be paid into the High Court, and any person claiming to be beneficially entitled to the whole or any part of such proceeds may, within thirty days of such payment into the High Court, apply to a judge of the High Court in chambers for payment out of the same to him.
96 Division 3 Interest In Shares of Approved Person-96. Interpretation.
for the purposes of this Division, "an approved person" does not include an approved operator of a payment system and an approved issuer of a designated payment instrument.
97 Division 3 Interest In Shares of Approved Person-97. Acquisition of interest in shares of approved person.
(1) Where a person enters into an agreement or arrangement to acquire any interest in shares of an approved person, by which, if the agreement or arrangement is carried out, he would hold, together with any interest in shares of the approved person which were then already held by him, an aggregate interest in shares of not less than five per cent of the shares of the approved person, such person shall notify the Bank of such fact upon entering into such agreement or arrangement within the period as may be specified by the Bank.
(2) In addition to subsection (1), no person shall enter into any agreement or arrangement for the purpose of acquiring interest in shares pursuant to subsection (1), if such acquisition will result in a change in the control of an approved person, unless such person obtains the prior written approval of the Bank upon entering into such agreement or arrangement.
(3) The Bank may specify standards on shareholder s
98 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-98. Interpretation.
for the purposes of this Division:
"security" includes a mortgage or charge, whether legal or equitable, debenture, bill of exchange, promissory note, guarantee, lien or pledge, whether actual or constructive, hypothecation, indemnity, undertaking or other means of securing payment or discharge of a debt or liability, whether present or future, or whether vested or contingent;
"transferee" means a person, including a licensed person, to which the whole or any part of the licensed business of a transferor is transferred under a business transfer scheme;
"transferor" means a licensed person which transfers the whole or any part of its licensed business under a business transfer scheme. 99 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-99. Approval required for reconstruction or amalgamation of licensed person.
No person shall enter into an agreement or arrangement for the reconstruction or amalgamation under the Companies Act 1965 of a licensed person except with the prior written approval of the Minister, on the recommendation of the Bank.
100 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-100. Approval required for business transfer scheme.
(1) No person shall enter into an agreement or arrangement for a scheme to transfer the whole or any part of the business of a licensed person, except with the prior written approval of the Bank.
(2) for the purposes of subsection (1), in the case of a licensed person which is a foreign insurer, a reference to "business" in subsection (1) is a reference to its Malaysian business as may be specified by the Bank.
(3) The transferor and transferee shall jointly submit an application for the approval of the Bank together with such documents or information as may be specified by the Bank.
(4) Where an agreement or arrangement for a business transfer scheme proposes to transfer the whole business, or a material part of the business of a licensed person, the Bank shall, prior to giving approval:
(a) be satisfied that the proposed agreement or arrangement is not prejudicial to:
(i) the
101 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-101. Notification of business transfer scheme.
(1) Before an application is made to the High Court under subsection 102(1), a transferor shall publish in the Gazette a notice stating its intention to make the application to the High Court for confirmation of the business transfer scheme.
(2) In addition to the notice under subsection (1), the Bank may require the transferor to give such other notice in respect of the business transfer scheme and for such purpose, the Bank may specify the following requirements:
(a) persons to whom, and when such notices shall be given;
(b) the form or manner of the notices to be given; and
(c) the period within which a person specified under paragraph (a) may object to the proposed scheme.
(3) Where any person files an objection to the proposed scheme, the transferor, with the approval of the Bank, may modify the scheme.
102 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-102. Application to High Court for confirmation of business transfer scheme.
(1) Upon obtaining the approval of the Bank under subsection 100(6), the transferor and transferee may make an application to the High Court for confirmation of the business transfer scheme.
(2) An application to the High Court with respect to any matter connected with a business transfer scheme may be made by a person, who in the opinion of the High Court, is likely to be affected by the scheme, at any time before the High Court grants an order under subsection (3) confirming the scheme.
(3) The High Court may confirm the business transfer scheme by granting an order in the terms applied for, or with modifications to the terms applied, or refuse to confirm the scheme.
(4) When the High Court makes an order confirming the business transfer scheme under subsection (3) after hearing all parties concerned, the High Court shall fix a date, to be applied for by the transferor and transferee and to be known as the transfer date, on wh
103 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-103. Bank to be party to proceedings.
(1) A person making an application to the High Court under subsection 102(2) in relation to a business transfer scheme shall:
(a) deliver a copy of the application to the Bank;
(b) give notice to the Bank of all proceedings relating to the application; and
(c) give to the Bank a copy of any document relating to the proceedings,
at the same time as the proceedings are instituted or the document is lodged, in the High Court or the document is served on a party to the proceedings.
(2) The Bank shall be entitled to be heard in proceedings relating to the application under subsection (1).
(3) Notwithstanding that the Bank has given its approval to a business transfer scheme under subsection 100(6), the Bank may propose any modification to the scheme.
104 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-104. Orders sought by transferor and transferee.
(1) In an application made under subsection 102(1), the transferor and transferee may seek all or any of the following orders:
(a) for the transferor's rights and title to the assets to be transferred to the transferee under a business transfer scheme without the need to effect the transfer of rights and titles to each asset individually;
(b) in relation to a banking or an investment banking business transfer scheme, for any account between the transferor and its customer to become an account between the transferee and the customer, subject to the same conditions and incidents existed between the transferor and its customer, and such account to be deemed for all purposes to be a single continuing account;
(c) in relation to an insurance business transfer scheme, for the transferee to be fully responsible for liabilities transferred by the business transfer scheme whether arising out of pol
105 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-105. Publication of court order under section 102.
(1) An order of the High Court made under subsection 102(3) shall, subject to the directions of the High Court, be published by the transferee in not less than two daily newspapers published in Malaysia and approved by the Bank, one of which shall be in the national language and the other in English.
(2) A transferor shall, within thirty days after the business transfer scheme has taken effect, lodge:
(a) such documents or information relating to the business transfer scheme as may be specified by the Bank, with the Bank; and
(b) a certified copy of such order made by the High Court under subsection 102(3) together with a certified copy of the Bank's approval, with:
(i) the Registrar of Companies; and
(ii) the appropriate authority, if any, concerned with the registration or recording of dealings in any movable property, or any interest in movable property transferred p
106 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-106. Reimbursement of Bank's expenses.
The transferor and transferee shall be jointly and severally liable to reimburse the Bank for any expenses the Bank may incur under this Division.
107 Division 4 Transfer of Business, Reconstruction Or Amalgamation of Licensed Person-107. Prohibition of payment out of insurance fund.
Unless the Bank otherwise approves, no licensed insurer shall pay to any person any remuneration out of the assets of an insurance fund in relation to a business transfer scheme.
108 PART VII FINANCIAL GROUPS-108. Purpose of this Part.
The Bank is empowered under this Part to exercise oversight over financial groups for the purposes of promoting the safety and soundness of a licensed person.
109 PART VII FINANCIAL GROUPS-109. Disapplication of sections 110 and 111 to licensed persons.
Sections 110 and 111 shall not apply to licensed persons.
110 PART VII FINANCIAL GROUPS-110. Application to be financial holding company.
(1) Any company which has to obtain the prior written approval of the Minister under section 87 to hold an aggregate interest in shares of more than fifty per cent in a licensed person shall submit an application to the Bank for it to be approved as a financial holding company.
(2) A company referred to in subsection (1) may propose another company within its corporate group to be approved as a financial holding company if it can be shown that the proposed company is in a position to have control over the licensed person and its proposed financial group.
(3) A person, other than a foreign institution or a company referred to in subsections (1) and (2), which is required to obtain the prior written approval of the Minister under section 87 to hold an aggregate interest in shares of more than fifty per cent in a licensed person shall propose a company within its corporate group which will have control over a licensed person and such propo
111 PART VII FINANCIAL GROUPS-111. Power of Bank to require submission of application.
Where the Bank considers it is necessary for the purpose of maintaining effective regulation and supervision of a licensed person, the Bank may require:
(a) any other company within the corporate group of the applicant, if the Bank is of the opinion that neither the applicant nor the other company proposed by the applicant under section 110 should be approved as a financial holding company; or
(b) a company which has an aggregate interest in shares of fifty per cent or less in the licensed person but has control over the licensed person,
to submit to the Bank an application to be approved as a financial holding company.
112 PART VII FINANCIAL GROUPS-112. Approval of application as financial holding company under section 110 or 111.
(1) An application to be a financial holding company under section 110 or 111, as the case may be, shall be submitted to the Bank together with such documents or information as may be specified by the Bank.
(2) In assessing an application under section 110 or 111 for an applicant company to be approved as a financial holding company submitted under subsection (1), the Bank shall have regard to all matters that the Bank considers relevant including the factors set out in Schedule 6 and any standards specified by the Bank under subsection 91(1).
(3) Where the Bank is satisfied that such matters referred to in subsection (2) have been fulfilled by the applicant, the Bank may approve an application made pursuant to section 110 or 111, as the case may be, with or without conditions, or reject such application.
(4) The Bank may, at any time, in writing amend or revoke any existing condition of approval of a financial holding company u
113 PART VII FINANCIAL GROUPS-113. Bank may approve more than one financial holding company.
The Bank may require more than one company within a corporate group of the applicant to be approved as a financial holding company.
114 PART VII FINANCIAL GROUPS-114. Business of financial holding company.
(1) Unless the Bank otherwise approves, a financial holding company of a licensed person shall not carry on any business, other than the business of holding investments directly or indirectly in corporations which are primarily engaged in financial services or in other services in connection with or for the purpose of such financial services.
(2) The Bank may specify standards to give full effect to subsection (1).
115 PART VII FINANCIAL GROUPS-115. Prudential requirements on financial holding company and subsidiaries.
(1) Subject to subsection (2), Part V shall apply to a financial holding company as if references in that Part to an "institution" or a "licensed person" are references to a "financial holding company".
(2) The Minister may, on the recommendation of the Bank, by an order published in the Gazette , provide that all or any provision of Part V:
(a) shall not apply to a financial holding company; or
(b) shall apply with such modifications consistent with the regulatory objectives of this Act.
(3) The Bank may specify standards on prudential matters under section 47 to a subsidiary of a financial holding company, if the Bank is of the opinion that the activities of such subsidiary may pose risks to the licensed person or its financial group.
(4) A subsidiary of a financial holding company referred to in subsection (3) shall at all times ensure that its internal poli
116 PART VII FINANCIAL GROUPS-116. Power to issue directions to financial holding company and subsidiaries.
(1) The Bank may issue one or more of the directions specified in subsection (2) or (3), if the Bank is of the opinion that:
(a) the financial holding company, its subsidiary or director, chief executive officer or senior officer of such financial holding company or such subsidiary:
(i) is committing or is about to commit an act, or is pursuing or is about to pursue any course of conduct or carrying on its business, in a manner that is detrimental to the safety and soundness of a licensed person;
(ii) has failed to comply with any standards, notice, condition, specification, requirement, restriction, direction or code specified, issued or made under this Act or a direction under subsection 214(6) or section 216 regardless that there has been no prosecution or other action in respect of such non-compliance; or
(iii) has breached or contravened any provision of this Act which is applicabl
117 PART VII FINANCIAL GROUPS-117. General provisions dealing with directions.
(1) The direction issued under subsection 116(2) or (3) shall specify:
(a) the grounds on which the Bank proposes to issue the direction; and
(b) the time by which, or period during which, the direction is to be complied with.
(2) The Bank may at any time:
(a) amend or revoke a direction; or
(b) replace a direction with another direction.
(3) Any direction issued under subsection 116(2) or (3) shall not affect the enforcement by the parties of their rights under a qualified financial agreement.
118 PART VII FINANCIAL GROUPS-118. Consequences of failing to comply with directions.
A financial holding company, its subsidiary, director or chief executive officer of such financial holding company or such subsidiary who fails to comply with a direction issued under subsection 116(2) or (3) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
119 PART VII FINANCIAL GROUPS-119. Additional provisions relating to paragraph 116(3)(e).
(1) A direction issued pursuant to paragraph 116(3) (e) may direct the financial holding company to issue shares or other capital instruments of a kind specified in the direction.
(2) Where the financial holding company issues shares or other capital instruments in compliance with a direction pursuant to subsection (1), the financial holding company shall give a notice in writing to the members of the financial holding company, to subscribe to the shares or other capital instruments within the period specified in the notice.
(3) Where a member of the financial holding company does not subscribe to the shares or other capital instruments within the period specified in the notice given by the financial holding company pursuant to subsection (2), the Bank may issue a further direction pursuant to subsection 116(2) to the financial holding company requiring the financial holding company to allot the shares or other capital instrumen
120 PART VII FINANCIAL GROUPS-120. Power to remove director or chief executive officer of financial holding company.
(1) Subject to section 262, the Bank may by a notice in writing, remove a director or chief executive officer of a financial holding company if the Bank is of the opinion that the director or chief executive officer of the financial holding company:
(a) no longer fulfills the fit and proper requirements specified by the Bank under section 60 which is applicable to a financial holding company pursuant to section 115, and fails to cease holding such office or acting in such capacity; or
(b) has failed to comply with or by action or negligence has contributed to the breach or contravention of, any provision of this Act, a direction of the Bank referred to in section 116 or an enforceable undertaking accepted by the Bank under section 259.
(2) A director or chief executive officer removed from office or employment in a financial holding company under subsection (1) shall cease to hold the
121 PART VIII BUSINESS CONDUCT AND CONSUMER PROTECTION Division 1 Interpretation-121. Interpretation.
for the purposes of this Division, Division 2 and Schedule 7:
"eligible complainant" means any person who is eligible to refer a dispute to a financial ombudsman scheme in accordance with the terms of reference of the scheme; "financial consumer" means any person who uses, has used or may be intending to use, any financial service or product:
(a) for personal, domestic or household purposes;
(b) in connection with a small business as may be specified by the Bank under section 123; or
(c) whether or not for the purposes set out in paragraph (a) or (b) , if:
(i) the value of the financial services or products does not exceed an amount as may be specified by the Bank under section 123; or
(ii) such person is of a class, category or description of
122 Division 2 Business Conduct, Complaints, Disputes, Etc.-122. Application.
(1) Sections 123 and 124 shall apply without prejudice to the provisions of the Capital Markets and Services Act 2007 in so far as such provisions relate to capital market products or capital market services as defined in subsection 2(1) of the Capital Markets and Services Act 2007, developed, offered or marketed by a licensed bank, licensed insurer or licensed investment bank.
(2) The Bank shall enter into an arrangement in writing with the Securities Commission to coordinate on the regulation of business conduct relating to capital market products or capital market services as defined in subsection 2(1) of the Capital Markets and Services Act 2007, developed, offered or marketed by a licensed bank, licensed insurer or licensed investment bank.
123 Division 2 Business Conduct, Complaints, Disputes, Etc.-123. Standards on business conduct.
(1) The Bank may specify standards on business conduct to a financial service provider for the purposes of ensuring that a financial service provider is fair, responsible and professional when dealing with financial consumers.
(2) Without limiting the generality of subsection (1), standards specified under that subsection may include standards relating to:
(a) transparency and disclosure requirements including the provision of information to financial consumers that is accurate, clear, timely and not misleading;
(b) fairness of terms in a financial consumer contract for financial services or products;
(c) promotion of financial services or products;
(d) provision of recommendations or advice including assessments of suitability and affordability of financial services or products offered to financial consumers; and
(e) complaints and dispute resolut
124 Division 2 Business Conduct, Complaints, Disputes, Etc.-124. Prohibited business conduct.
(1) A financial service provider shall not engage in any prohibited business conduct set out in Schedule 7.
(2) Without limiting the generality of section 266, the Bank may issue guidance in writing on:
(a) descriptions of conduct which amount to; or
(b) factors that are to be taken into account in determining whether a financial service provider has engaged in,
any prohibited business conduct set out in Schedule 7.
(3) Where the Bank issues guidance relating to prohibited business conduct set out in paragraphs 5 and 6 of Schedule 7, such guidance shall be issued in consultation with the Competition Commission.
(4) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million ringgit or to both.
(5) In relation to any complaint f
125 Division 2 Business Conduct, Complaints, Disputes, Etc.-125. Approved insurance broker, approved financial adviser and approved issuer of designated payment instrument to establish customer account.
(1) Where:
(a) an approved insurance broker or approved financial adviser receives any money:
(i) from or on behalf of an insured or potential insured for or on account of a licensed insurer in connection with a contract of insurance or a proposed contract of insurance; or
(ii) from or on behalf of a licensed insurer for or on account of an insured; or
(b) an approved issuer of a designated payment instrument as may be determined by the Bank, receives any money from or on behalf of its user in exchange of the payment instrument issued,
such approved person shall, for the purposes of this section, establish and maintain one or more accounts for its customers in a licensed bank separate from its own account.
(2) for the purposes of subsection (1):
(a) a lien or claim on, or a right to set-off, the moneys in
126 Division 2 Business Conduct, Complaints, Disputes, Etc.-126. Financial ombudsman scheme.
(1) for the purposes of ensuring effective and fair handling of complaints and for the resolution of disputes in connection with financial services or products, regulations may be made under section 260 to require any class, category or description of financial service providers:
(a) to be a member of a financial ombudsman scheme approved under subsection (2); and
(b) at all times, to comply with terms of membership of such scheme.
(2) The Bank may approve any financial ombudsman scheme for the purposes of paragraph (1) (a) .
(3) Regulations may be made under section 260 for the purposes of ensuring a financial ombudsman scheme is fair, accessible and effective, including regulations on the following:
(a) the matters that the Bank may have regard to in determining whether to approve a financial ombudsman scheme under subsection (2);
127 Division 3 Insurance Issues-127. Obtaining insurance outside Malaysia.
(1) Except with the prior written approval of the Bank, no person shall enter into or cause to be entered into, a contract of general insurance of such description as may be prescribed by the Bank with an insurer other than a licensed general insurer.
(2) The Bank may grant an approval under subsection (1) after consultation with the Minister.
(3) A person shall provide to the Bank such information on any contract of general insurance entered into, or caused to be entered into with an insurer other than a licensed general insurer, as the Bank may require by notice in writing within such period as may be specified in the notice.
128 Division 3 Insurance Issues-128. Provisions relating to policies.
Schedule 8 sets out provisions relating to policies.
129 Division 3 Insurance Issues-129. Pre-contractual disclosure and representations, and remedies for misrepresentations.
(1) Schedule 9 sets out the pre-contractual duty of disclosure and representations for contracts of insurance in Part 2, and the remedies for misrepresentations relating to contracts of insurance in Part 3.
(2) Any person who contravenes the duty of disclosure under paragraph 11 of Schedule 9 commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million ringgit or to both.
130 Division 3 Insurance Issues-130. Payment of policy moneys under life policy and personal accident policy.
Schedule 10 sets out provisions for the payment of policy moneys upon death of a policy owner under a life policy, including a life policy under section 23 of the Civil Law Act 1956 [Act 67] and a personal accident policy effected by him upon his own life.
131 Division 4 Information And Secrecy-131. Interpretation.
for the purposes of this Division:
"customer" includes a participant or user;
"financial institution" refers to:
(a) a licensed bank;
(b) a licensed investment bank;
(c) an approved operator of a payment system;
(d) a registered operator of a payment system;
(e) an operator of a designated payment system; or
(f) an approved issuer of a designated payment instrument.
132 Division 4 Information And Secrecy-132. Restriction on inquiring specifically into affairs of particular customer.
(1) Nothing in this Act shall:
(a) authorize the Minister to direct the Bank; or
(b) authorize the Bank,
to inquire specifically into the affairs or account of any customer of any authorized person.
(2) Notwithstanding paragraph (1) (b) , the Bank may inquire into the affairs or account of a customer of an authorized person for the purposes of exercising its powers or functions under this Act, the Islamic Financial Services Act 2013 or section 47 of the Central Bank of Malaysia Act 2009.
133 Division 4 Information And Secrecy-133. Secrecy.
(1) No person who has access to any document or information relating to the affairs or account of any customer of a financial institution, including:
(a) the financial institution; or
(b) any person who is or has been a director, officer or agent of the financial institution,
shall disclose to another person any document or information relating to the affairs or account of any customer of the financial institution.
(2) Subsection (1) shall not apply to any document or information relating to the affairs or account of any customer of a financial institution:
(a) that is disclosed to the Bank, any officer of the Bank or any person appointed under this Act or the Central Bank of Malaysia Act 2009 for the purposes of exercising any powers or functions of the Bank under this Act or the Central Bank of Malaysia Act 2009;
(b) that is in
134 Division 4 Information And Secrecy-134. Permitted disclosures.
(1) A financial institution or any of its directors or officers may:
(a) for such purpose or in such circumstances as set out in the first column of Schedule 11, disclose any document or information relating to the affairs or account of its customer to such persons specified in the second column of that Schedule; or
(b) disclose any document or information relating to the affairs or account of its customer to any person where such disclosure is approved in writing by the Bank.
(2) The financial institution or its directors or officers making a disclosure for the purposes or in such circumstances set out in Schedule 11 and paragraph (1) (b) , shall be subject to such conditions as may be specified by the Bank.
(3) for the purposes of subsection (2), the Bank may at any time amend or revoke any existing conditions or impose any new conditions in respect of permitted discl
135 Division 5 Restrictions Relating To Consumer Protection-135. Application of this Division.
This Division shall not apply to a licensed Islamic bank under the Islamic Financial Services Act 2012.
136 Division 5 Restrictions Relating To Consumer Protection-136. Deposit.
for the purposes of sections 137 and 138, "deposit" means a sum of money or any precious metal or precious stone, or any article or thing as may be prescribed by the Minister, on the recommendation of the Bank, accepted, paid or delivered on terms under which it will be repaid or returned in full, regardless whether the repayment or return is by way of instalments, with or without interest or any other consideration in money or money's worth, either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment or delivery and the person accepting it, but excludes money paid bona fide :
(a) by way of an advance or a part payment under a contract for the sale, hire or other provision of property or services, and is repayable only in the event that the property or services are not in fact sold, hired or otherwise provided;
(b) by way o
137 Division 5 Restrictions Relating To Consumer Protection-137. Restriction on accepting deposits.
(1) No person shall accept deposits except under a licence granted under section 10 regardless of whether the transaction is described as a loan, an advance, an investment, a savings, a sale or a sale and repurchase or by whatever name called.
(2) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
138 Division 5 Restrictions Relating To Consumer Protection-138. Advertisements for deposits.
(1) No person, other than a licensed bank or licensed investment bank, shall issue, or otherwise facilitate any person to issue, an advertisement which:
(a) contains any offer or invitation:
(i) to make any deposit; or
(ii) to enter or offer to enter into any agreement to make any deposit; or
(b) is intended, directly or indirectly, to lead to or induce the making of any deposit.
(2) Subsection (1) shall not apply to the issuance by any person of any advertisement for or on behalf of a licensed bank or licensed investment bank.
(3) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million ringgit or to both.
139 Division 5 Restrictions Relating To Consumer Protection-139. Restriction on use of certain words.
(1) Except with the prior written approval of the Bank, no person shall:
(a) in its name, description or title under which such person carries on business or in the conduct of its business, use:
(i) the word "bank" unless such person is licensed under this Act to carry on banking business or investment banking business;
(ii) the word "insurance" or "assurance" unless such person is authorized or registered under this Act to carry on insurance business, insurance broking business, financial advisory business or adjusting business;
(iii) the words "financial adviser" unless such person is approved under this Act to carry on financial advisory business;
(iv) any derivative of the words in subparagraph (i), (ii) or (iii) in any language; or
(v) any other words in any language,
capable of being construed as indicating the carrying on of any of the author
140 PART IX MONEY MARKET AND FOREIGN EXCHANGE MARKET-140. Power of Bank to specify standards or issue codes.
(1) The Bank may specify standards or issue codes for the purposes of developing, or maintaining orderly conditions or the integrity of, the money market or foreign exchange market.
(2) Without limiting the generality of subsection (1), standards specified or codes issued under that subsection may include standards or codes relating to:
(a) obligations and duties of any market participant or any officer of the market participant; and
(b) the issuance, sale, purchase, repurchase, borrowing or lending, of or other dealings in, currencies or other financial instruments traded in the money market or foreign exchange market including over-the-counter derivatives whose price, value or payment obligations are derived from, referenced to or based on interest rates or exchange rates.
(3) Standards or codes may only be specified or issued under paragraph (2) (b) in respect of ov
141 PART IX MONEY MARKET AND FOREIGN EXCHANGE MARKET-141. Prohibited conduct in MONEY MARKET AND FOREIGN EXCHANGE MARKET.
(1) No person shall:
(a) take part in or carry out a transaction that has or is likely to have the effect of creating a rate which is an off-market rate which results in an artificial rate for dealing in financial instruments in the money market or foreign exchange market;
(b) create, or cause to be created, or do anything that is calculated to create, a false or misleading appearance of active dealing in financial instruments in the money market or foreign exchange market;
(c) make a statement, or disseminate information that is false or misleading in a material particular and is likely to induce another person to deal in financial instruments or is likely to have the effect of raising, lowering, maintaining or stabilising the market rate of such financial instruments in the money market or foreign exchange market and when the person makes the statement, or disseminates the information:
142 PART IX MONEY MARKET AND FOREIGN EXCHANGE MARKET-142. Arrangement with relevant supervisory authority.
(1) The Bank shall enter into arrangements with relevant supervisory authorities to coordinate on the regulation of financial instruments traded in the money market which are within the purview and oversight of the relevant supervisory authorities.
(2) for the purposes of this section, "relevant supervisory authorities" means any authority, body or agency in Malaysia other than the Bank which is responsible for the supervision or oversight of the capital market, or capital market intermediaries or capital market participants.
143 PART X SUBMISSION OF DOCUMENT OR INFORMATION-143. SUBMISSION OF DOCUMENT OR INFORMATION to Bank.
(1) Where under this Act or any written law, any person including:
(a) an authorized person;
(b) a registered person;
(c) an operator of a designated payment system;
(d) a financial holding company;
(e) a market participant;
(f) an approved representative office;
(g) a financial institution prescribed under section 212;
(h) an associate corporation or related corporation of a person referred to in paragraphs (a) to (g) ; or
(i) a participant, user or any other person having dealings with a person referred to in paragraphs (a) to (g) ,
is required to submit any document or information to the Bank, such person shall submit such document or information to the Bank.
(2) Where, for the purposes of the exercise of any of its powers
144 PART X SUBMISSION OF DOCUMENT OR INFORMATION-144. Submission of statistical information, etc.
(1) for the purposes of collating statistical or other information on financial intermediation or financial inclusion in Malaysia or for other purposes related to the regulatory objectives of this Act, the Bank may require any person to submit any document or information to the Bank.
(2) Subject to section 145, the Bank shall not disclose to any person any document or information submitted under subsection (1) unless such disclosure is in summary or consolidated form and does not in any manner lead to the identification of any person to which such document or information relates.
145 PART X SUBMISSION OF DOCUMENT OR INFORMATION-145. Secrecy requirements under sections 143 and 144 not to apply.
The secrecy requirements in subsections 143(7) and 144(2) shall not apply:
(a) for the purposes of the exercise of any of its powers or the performance of any of its functions by the Bank under this Act or the Central Bank of Malaysia Act 2009, including for the purposes of:
(i) the credit bureau established under section 47 of the Central Bank of Malaysia Act 2009; or
(ii) submitting any proposal to the Financial Stability Executive Committee;
(b) in respect of information provided by the Bank under section 95 of the Malaysia Deposit Insurance Corporation Act 2011;
(c) where such disclosure is in summary or consolidated form and does not in any manner lead to the identification of any person to which such document or information relates including the publication of consolidated statements or reports in respect of each class, category or descripti
146 PART XI EXAMINATION-146. Examination of authorized person, etc.
(1) The Bank may examine, without any prior notice, the business and affairs of the following persons:
(a) an authorized person, registered person, operator of a designated payment system or financial holding company, and the offices, related corporations and any agent of any such persons, in or outside Malaysia;
(b) a market participant; or
(c) an approved representative office.
(2) The Bank may, for the purposes of an examination under subsection (1), examine any director, officer or controller of any person referred to in subsection (1).
147 PART XI EXAMINATION-147. Duty to provide access to, and produce documents, information, etc.
(1) for the purposes of an examination under section 146, a person under examination and its director, officer or controller:
(a) shall afford the Bank access to its documents, including documents of title to its assets, all securities held by it in respect of its customers' transactions and investments held by it, cash, premises, apparatus, equipment or machinery, and produce to the Bank all such documents or cash, as the Bank may require within such time as it may specify;
(b) shall allow the Bank to copy or make extracts of any document referred to in paragraph (a) ; and
(c) shall give to the Bank, orally or in writing, all such information and explanation relating to its business and affairs or of its agent as the Bank may require within such time as it may specify.
(2) The Bank may take possession of any documents, titles, securities, cash, apparatus, equ
148 PART XI EXAMINATION-148. Examination of other persons.
(1) The Bank may, for the purposes of an examination under section 146, examine:
(a) a person who was at any time, a director or officer of a person referred to in subsection 146(1);
(b) a person who is, or was at any time having dealings with a person referred to in subsection 146(1); or
(c) a person whom the Bank believes to be acquainted with the facts and circumstances of the case, including the auditor of a person referred to in subsection 146(1),
and that person shall give to the Bank such document, information or explanation as the Bank may require within such time as it may specify.
(2) Any person falling under paragraph (1) (b) , or an auditor referred to in paragraph (1) (c) shall not be liable for breach of a contract relating to, or duty of, confidentiality for giving a document, information or explanation under subsection (1).
<149 PART XI EXAMINATION-149. Appearance before Bank.
(1) Any person examined under sections 146 and 148 shall appear before the Bank at such place, and at such time, as may be specified by the Bank.
(2) Any person who contravenes subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
150 PART XI EXAMINATION-150. Examination or assessment by auditor or actuary.
(1) The Bank may require an authorized person, operator of a designated payment system or financial holding company to appoint an auditor, or actuary, as the case may be, to carry out any specific examination or assessment in respect of its business or affairs as may be specified by the Bank and submit a report of such examination or assessment to the Bank.
(2) Where an examination or assessment is required under subsection (1), the remuneration of the auditor or actuary and other expenses related to such examination or assessment shall be borne by the authorized person, operator of a designated payment system or financial holding company.
151 PART XI EXAMINATION-151. Confidential information.
(1) Any document or information produced by the Bank as provided in subsection (2) as a result of the administration or enforcement of this Act, the Central Bank of Malaysia Act 2009 or any other written law administered by the Bank, or from an examination by a relevant supervisory authority under section 152, shall not be disclosed by any authorized person, operator of a designated payment system or financial holding company, or any director, officer, auditor or actuary of such persons, to any other person except in such circumstances as may be specified by the Bank.
(2) A document or information referred to in subsection (1) which shall not be disclosed, whether wholly or in part, shall include:
(a) any rating assigned by the Bank or relevant supervisory authority, as the case may be, to an authorized person, operator of a designated payment system or financial holding company;
(b) any stage of i
152 PART XI EXAMINATION-152. Examination by relevant overseas supervisory authority.
(1) A relevant supervisory authority outside Malaysia which exercises functions corresponding to those of the Bank under this Act may, with the approval of the Bank, examine the books and transactions of:
(a) an approved representative office in Malaysia of a foreign institution;
(b) an authorized person which operates in Malaysia as a branch of a foreign institution; or
(c) an authorized person, registered person, operator of a designated payment system or financial holding company which is a subsidiary of a foreign institution,
established or incorporated in that country, territory or place, provided that such examination by the relevant supervisory authority is for the sole purpose of its supervisory functions.
(2) The relevant supervisory authority shall give to the Bank a written undertaking to protect the confidentiality of any information it has obtaine
153 PART XI EXAMINATION-153. Disclosure of information by Bank to relevant overseas supervisory authority.
The Bank may, subject to such terms and conditions it deems fit, provide to a relevant supervisory authority outside Malaysia which exercises functions corresponding to those of the Bank under this Act, such document or information relating to:
(a) the affairs of:
(i) any authorized person, registered person, operator of a designated payment system or financial holding company which is a subsidiary of a foreign institution; or
(ii) any authorized person, registered person, operator of a designated payment system or financial holding company which is an associate of a foreign institution;
(b) any office of an authorized person, registered person, operator of a designated payment system or financial holding company; or
(c) any authorized person, registered person, operator of a designated payment system or financial holding company for the purposes
154 PART XII DIRECTIONS OF COMPLIANCE-154. Interpretation.
for the purposes of this Part, "institution" refers to an authorized person or operator of a designated payment system.
155 PART XII DIRECTIONS OF COMPLIANCE-155. Circumstances for exercising power to issue directions.
The Bank may issue one or more of the directions specified in section 156 if the Bank is of the opinion that an institution, its director, chief executive officer or senior officer:
(a) is committing or is about to commit an act, or is pursuing or is about to pursue any course of conduct, that is unsafe or unsound or has failed to commit an act or pursue a course of conduct that is necessary to maintain the safety and soundness of the institution;
(b) is carrying on business in a manner detrimental to the interests of depositors, policy owners, participants, users, creditors or the public generally;
(c) has failed to manage its business or affairs in a manner that is consistent with sound risk management and good governance practices;
(d) has failed to comply with any standards, notice, condition, specification, requirement, restriction, direction or code specified, issued
156 PART XII DIRECTIONS OF COMPLIANCE-156. Power to issue directions to institution.
(1) Subject to section 262, the Bank may issue a direction in writing to the institution, its director, chief executive officer or senior officer, to cease or refrain from committing an act or pursuing a course of conduct or to do any act, in relation to its business, affairs or property if the Bank is of the opinion that it is necessary to remedy any of the circumstances in section 155.
(2) Without limiting the generality of subsection (1), the direction under subsection (1) may include:
(a) with respect to any institution, any one or more of the following directions:
(i) to vary or terminate any agreement or arrangement other than any qualified financial agreement entered into by the institution with any person in relation to its business, affairs or property;
(ii) to dispose of all or any of the investments or assets held by the institution in any body corporate;
(iii) to pro
157 PART XII DIRECTIONS OF COMPLIANCE-157. General provisions dealing with directions.
(1) The direction issued under section 156 shall specify:
(a) the grounds on which the Bank proposes to issue the direction; and
(b) the time by which, or period during which, the direction is to be complied with.
(2) The Bank may at any time:
(a) amend or revoke a direction; or
(b) replace a direction with another direction.
(3) Any direction issued under section 156 shall not affect the enforcement by the parties of their rights under a qualified financial agreement.
158 PART XII DIRECTIONS OF COMPLIANCE-158. Consequences of failing to comply with directions.
An institution, its director, chief executive officer or senior officer who fails to comply with a direction issued under section 156 commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding fifty million ringgit or to both.
159 PART XII DIRECTIONS OF COMPLIANCE-159. Additional provisions relating to paragraph 156(2)(b).
(1) A direction issued pursuant to paragraph 156(2) (b) may direct the licensed person to issue shares or other capital instruments of a kind specified in the direction.
(2) Where the licensed person issues shares or other capital instruments in compliance with a direction pursuant to subsection (1), the licensed person shall give a notice in writing to the members of the licensed person to subscribe to the shares or other capital instruments within the period specified in the notice.
(3) Where a member of the licensed person does not subscribe to the shares or other capital instruments within the period specified in the notice given by the licensed person pursuant to subsection (2), the Bank may issue a further direction pursuant to subsection 156(1) to the licensed person requiring the licensed person to allot the shares or other capital instruments to a person determined by the Bank.
160 PART XIII INTERVENTION AND REMEDIAL ACTION-160. Application of this Part to member institution.
(1) Notwithstanding any other provision in this Part, in respect of an institution that is a member institution as defined under the Malaysia Deposit Insurance Corporation Act 2011:
(a) the Bank may exercise the following powers:
(i) the powers under sections 161 to 163 and paragraph 188 (a) ; and
(ii) for the sole purpose of averting or reducing any risk to financial stability and where the institution has not ceased to be viable or is not considered by the Bank to be likely to become non-viable, the powers under the following provisions:
(A) paragraph 188(b);
(B) sections 189 and 190; and
(C) section 208; and
(b) the following provisions shall continue to apply:
(i) subsections 173(1) and (2) except where the application for the appointment of a receiver and manager to manage the whol
161 Division 1 Removal of Director, Chief Executive Officer or Senior Officer-161. Interpretation.
for the purposes of this Division, "institution" refers to a licensed person or an operator of a designated payment system.
162 Division 1 Removal of Director, Chief Executive Officer or Senior Officer-162. Power to remove director, chief executive officer or senior officer.
Subject to section 262, the Bank may, by an order in writing, remove a director, chief executive officer or senior officer from office or employment in an institution if the Bank is of the opinion that the director, chief executive officer or senior officer of the institution:
(a) no longer fulfils the fit and proper requirements specified under section 60 and fails to cease holding such office or acting in such capacity; or
(b) has breached, contravened or failed to comply with or, by action or negligence, has contributed to the breach or contravention of, or non-compliance with any provision of this Act, a direction under section 156 or an enforceable undertaking accepted by the Bank under section 259.
163 Division 1 Removal of Director, Chief Executive Officer or Senior Officer-163. Provisions relating to removal.
(1) A director, chief executive officer or senior officer removed from office or employment in an institution under section 162 shall cease to hold the office from which he is removed with effect from the date set out in the order and shall cease to be concerned with the business or affairs of the institution.
(2) The removal of a director, chief executive officer or senior officer under section 162 shall be lawful and valid notwithstanding anything contained in a contract of service or any other agreement relating to his appointment and whether or not made or provided for under any written law, and a person so removed from office or employment shall not be entitled to claim compensation for the loss of office.
164 Division 2 Power To Take Intervention And Remedial Action Subdivision 1 Circumstances for Exercising Intervention and Remedial Action-164. Interpretation.
for the purposes of this Subdivision, "institution" refers to a licensed person, an approved issuer of a designated payment instrument or operator of a designated payment system.
165 Division 2 Power To Take Intervention And Remedial Action Subdivision 1 Circumstances for Exercising Intervention and Remedial Action-165. Circumstances for exercise of Bank's power.
Where the Bank is of the opinion that any of the following circumstances exist in respect of an institution:
(a) the institution has breached or contravened any provision of this Act, the Islamic Financial Services Act 2012, the Central Bank of Malaysia Act 2009 or any written law, regardless that there has been no prosecution or other action in respect of the breach or contravention;
(b) the institution has failed to comply with any direction under section 156;
(c) the assets of the institution are not sufficient to give adequate protection to its depositors, policy owners, participants, users or creditors, as the case may be;
(d) the capital of the institution has reached a level or is eroding in a manner that may detrimentally affect its depositors, policy owners, participants, users, creditors or the public generally;
(e) the institution has become or
166 Subdivision 2 Assumption of Control-166. Interpretation.
for the purposes of this Subdivision:
"appointed person" refers to a person appointed by the Bank under subsection 167(1);
"institution" refers to a licensed person or an operator of a designated payment system.
167 Subdivision 2 Assumption of Control-167. Power to assume control.
(1) Subject to section 262, where any of the circumstances set out in section 165 exist in respect of an institution, the Bank may, with the prior approval of the Minister, by an order in writing, assume control of the whole or part of the business, affairs or property of the institution and manage the whole or such part of its business and affairs, or appoint any person to do so on behalf of the Bank.
(2) The terms and conditions of the appointed person shall be determined by the Bank.
(3) Where an order has been made under subsection (1) or revoked under subsection 168(1), the Bank shall:
(a) notify that fact in the Gazette; and
(b) give notice of the commencement of the assumption of control under subsection (1), or revocation of the order in writing under subsection 168(1), as soon
as is practicable by publication in at least two daily newspapers in Malaysia, one o
168 Subdivision 2 Assumption of Control-168. Effect of assumption of control.
(1) Upon assuming control of the whole or part of the business, affairs or property of the institution, the Bank or the appointed person shall take custody and control of the whole or part of the business, affairs or property of the institution, and shall manage the whole or such part of the business and affairs of the institution in the name and on behalf of that institution until the order is revoked by the Bank in writing.
(2) During the period an order under this Subdivision is in force, the functions, rights and privileges of:
(a) the directors and chief executive officer of the institution shall be suspended unless the Bank gives its approval in writing for any director to remain as director or the chief executive officer to continue in the employment of the institution on such terms and conditions as the Bank may determine; and
(b) such senior officers of the institution as may be specified
169 Subdivision 2 Assumption of Control-169. Information and facilities.
(1) Where control of the whole or part of the business, affairs or property of an institution has been assumed pursuant to an order under this Subdivision:
(a) the institution, its directors, chief executive officer and officers shall submit the whole or part of the business, affairs or property to such control and provide the Bank or the appointed person with such facilities, documents or information as may be required to facilitate the exercise of powers or performance of functions of the Bank or the appointed person under this Subdivision; and
(b) the Bank or the appointed person may require a person who has, at any time, been a director, chief executive officer or an officer of the institution to give the Bank or the appointed person any information relating to the business, affairs or property of the institution that the Bank or the appointed person requires.
(2) Any person who c
170 Subdivision 2 Assumption of Control-170. Additional provisions relating to assumption of control.
(1) Upon assuming control of the whole or part of the business, affairs or property of the institution, where the Bank gives its approval in writing for the director or chief executive officer to remain in his appointment pursuant to paragraph 168(2) (a) , any remuneration payable to the director or chief executive officer of the institution shall be determined by the Bank, in relation to the activity required or authorized by the Bank or the appointed person.
(2) Notwithstanding anything contained in any contract of service or any other agreement relating to his appointment, the suspension of the director or chief executive officer under paragraph 168(2) (a) shall not entitle him to claim any compensation for such suspension.
(3) An order under this Subdivision shall not have the effect of:
(a) conferring on, or vesting in, the Bank or the appointed person, any title to, or any beneficial in
171 Subdivision 3 Power to Appoint Receiver and Manager-171. Interpretation.
for the purposes of this Subdivision, "institution" refers to a licensed person, an approved issuer of a designated payment instrument or operator of a designated payment system.
172 Subdivision 3 Power to Appoint Receiver and Manager-172. Appointment of receiver and manager by Bank.
(1) Subject to section 262, where any of the circumstances described in section 165 exist in respect of an institution, the Bank may make an application to the High Court for an order:
(a) to appoint a receiver and manager to manage the whole or part of the business, affairs or property of the institution; and
(b) for all such incidental, ancillary or consequential orders or directions of the High Court in relation to such appointment as may, in the opinion of the Bank, be necessary or expedient.
(2) On an application by the Bank, the High Court shall appoint as receiver and manager, such person as may be specified by the Bank in its application including such person as may be specified by the Bank to fill a vacancy or to remove and replace a receiver and manager appointed under this Subdivision.
(3) All costs and expenses of the Bank, including the remuneration of such receiv
173 Subdivision 3 Power to Appoint Receiver and Manager-173. Appointment of receiver and manager by persons other than Bank.
(1) Any person may make an application to the High Court for the appointment of a receiver and manager to manage the whole or part of the business, affairs or property of a licensed person, an approved person, a registered person or an operator of a designated payment system, as the case may be, by giving prior written notice of thirty days to the Bank of its intention to do so.
(2) Where an application is made to the High Court for an order to appoint a receiver and manager to manage the whole or part of the business, affairs or property of a licensed person, an approved person, a registered person or an operator of a designated payment system, as the case may be, that person shall, as soon as practicable, deliver a sealed copy of the application to the Bank.
(3) Where, pursuant to a debenture or any other instrument, a receiver and manager is appointed over the whole or part of the business, affairs or property of a licensed person, a
174 Subdivision 3 Power to Appoint Receiver and Manager-174. Provisions in relation to appointment of receiver and manager.
Where a receiver and manager has been appointed by the Bank to manage the whole or part of the business, affairs or property of an institution pursuant to section 172, the receiver and manager shall have the power:
(a) to enter into any premises of the institution and take possession and control of the whole or part of the business, affairs or property of the institution and require any person in the premises to account for and deliver up to the Bank or the receiver and manager, possession and control of the whole or such part of the business or property;
(b) subject to paragraph (c) , to sell or otherwise dispose of the whole or part of the business or property of the institution on such terms and conditions as determined by the Bank;
(c) to sell or otherwise dispose of any property of the institution that is subject to an agreement creating a security interest to any person who a
175 Subdivision 4 Compulsory Transfer of Business, Assets or Liabilities-175. Interpretation.
for the purposes of this Subdivision:
"residual institution" means a licensed person whose business, assets or liabilities have been vested in the transferee in accordance with section 176;
"transacted price" means the price at which the whole or part of the business, assets or liabilities of a licensed person referred to in section 176 is vested in the transferee;
"transferee" means a bridge institution or any other person, as the case may be, in which is vested under this Subdivision the whole or part of the business, assets or liabilities of the licensed person referred to in section 176;
"transferor" means the licensed person under this Subdivision referred to in section 176;
"transferred business" 176 Subdivision 4 Compulsory Transfer of Business, Assets or Liabilities-176. Order for compulsory transfer of business, assets or liabilities.
(1) The Minister shall, on the recommendation of the Bank, designate in writing a body corporate established or acquired by the Bank under paragraph 48(1) (da) of the Central Bank of Malaysia Act 2009 as a bridge institution for the purposes of vesting in such body corporate the business, assets or liabilities of a licensed person referred to in subsection (2).
(2) Where any of the circumstances set out in section 165 exist in respect of a licensed person, the Bank may, with the prior approval of the Minister, by an order in writing, vest in a bridge institution or any other person, the whole or part of the business, assets or liabilities of such licensed person.
(3) for purposes of subsection (2), the Third Schedule of the Central Bank of Malaysia Act 2009 shall apply in relation to an order of the Bank under this Subdivision and such order shall be binding on all persons to whom the order is made or who are affected by the ord
177 Subdivision 4 Compulsory Transfer of Business, Assets or Liabilities-177. Additional provisions relating to compulsory transfer.
(1) The Third Schedule of the Central Bank of Malaysia Act 2009 shall apply in relation to an order of the Bank under this Subdivision, with modifications, as provided in Schedule 13 and the Minister may prescribe any other modification as may be necessary to give effect to such order.
(2) Where the Bank makes an order under this Subdivision to a licensed person, the Bank shall:
(a) notify that fact in the Gazette ; and
(b) give notice of such order as soon as is practicable by publication in at least two daily newspapers published in Malaysia, one of which shall be in the national language.
(3) The notice under paragraph (2)(b) shall include the transacted price of the transfer and the right of any aggrieved person to appeal on the transacted price to the Assessor Committee.
(4) The transacted price referred to in subsection (3) shall be determined by an indep
178 Subdivision 4 Compulsory Transfer of Business, Assets or Liabilities-178. Continuity obligations.
(1) The Bank may direct the residual institution and any person who has been providing services and facilities to the transferor for the operation of its business, to continue to provide to the transferee, such services and facilities as may be required to enable a transferee to operate the transferred business effectively.
(2) The duty to provide services and facilities in pursuance of the direction of the Bank in subsection (1) is subject to a right to receive reasonable consideration from the transferee.
(3) Any residual institution or person who fails to comply with a direction under subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
179 Subdivision 5 Provisions Relating to Bridge Institution-179. Designation of bridge institution.
(1) Where the Minister designates a bridge institution under section 176:
(a) the designation shall expire two years after it is made, unless the designation is:
(i) extended under paragraph (b) ; or
(ii) terminated under paragraph (c) ;
(b) the Minister may, on the recommendation of the Bank, extend the designation for one or more periods, each of which may not exceed one year; and
(c) the designation shall terminate on the earlier of the date of occurrence of any one of the following events:
(i) the Bank ceases to hold shares in the bridge institution;
(ii) all or a substantial amount of the assets of the bridge institution are acquired, or all or a substantial amount of the liabilities of the bridge institution are assumed, or both, by a person that is not a bridge institution; or
(iii) the M
180 Subdivision 5 Provisions Relating to Bridge Institution-180. Publication of notice.
Upon the designation of a bridge institution or where such designation is extended under paragraph 179(1) (b) or terminated under paragraph 179(1) (c) , the Bank shall as soon as practicable publish a notice, specifying the date on which that event occurred in at least two daily newspapers in Malaysia, one of which shall be in the national language.
181 Subdivision 5 Provisions Relating to Bridge Institution-181. Bridge institution authorized to carry on business.
(1) Upon its designation as such, and for so long as the designation continues, a bridge institution shall be deemed to be licensed to carry on the business of the licensed person whose business, assets or liabilities have been vested in the bridge institution.
(2) The Bank may exempt the bridge institution from such requirements, or grant such approvals, under this Act as may be necessary to facilitate the carrying on of its licensed business.
182 Subdivision 5 Provisions Relating to Bridge Institution-182. Bridge institution not liable for past obligations in respect of officers.
Where a bridge institution becomes the employer of any individual who is an officer or a former officer of a licensed person, the bridge institution shall not:
(a) be liable for any obligation of the licensed person or its predecessor in respect of such individual existing prior to the bridge institution becoming the employer of the individual or in respect of any pension plan or other post-employment benefit plan for such individual or his survivors, or in respect of any collective agreement with a trade union or a council of trade unions; or
(b) be liable for any wages or salary calculated by reference to a period of time prior to the bridge institution becoming the employer of the individual in question.
183 Subdivision 5 Provisions Relating to Bridge Institution-183. Stay in respect of bridge institution.
During the period of ninety days following the designation of a bridge institution:
(a) no action, suit or proceeding in any court or tribunal, may be commenced or continued against the bridge institution or in respect of its assets;
(b) no attachment, garnishment, execution or other method of enforcement of a judgement, award or order against the bridge institution or its assets may take place or continue; and
(c) no creditor of the bridge institution has any remedy against the bridge institution or its assets.
184 Subdivision 5 Provisions Relating to Bridge Institution-184. Financial assistance to bridge institution.
Notwithstanding section 76 of the Central Bank of Malaysia Act 2009, the Bank may provide a bridge institution with such financial assistance as the Bank thinks appropriate and the bridge institution shall, on demand or at such other time as the Bank specifies, repay or reimburse to the Bank, the financial assistance on such terms and conditions as determined by the Bank.
185 Subdivision 6 Restructuring of Share Capital-185. Interpretation.
for the purposes of this Subdivision, "institution" refers to a licensed person or an operator of a designated payment system.
186 Subdivision 6 Restructuring of Share Capital-186. Power to reduce share capital of institution.
(1) Notwithstanding any constituent documents of an institution, the Bank may apply to the High Court for an order:
(a) where the paid-up capital of the institution is lost or unrepresented by available assets, to cancel such paid-up capital of the institution which is lost or unrepresented by available assets; or
(b) where a call has been made by the institution on its members to pay on the unpaid portion of their respective shares, if any, and payment has not been made within the time specified in the call, to consolidate the paid up portion of the shares as fully paid up and to cancel any shares which remain unpaid.
(2) Where the Bank applies for the cancellation of share capital under subsection (1), the institution shall not be required to notify or obtain the approval of its members or creditors in a general meeting or otherwise.
(3) Subject to subsections (1) and (2), t
187 Subdivision 7 Financial Assistance-187. Interpretation.
for the purposes of this Subdivision, "institution" refers to a licensed person or an operator of a designated payment system.
188 Subdivision 7 Financial Assistance-188. Liquidity or financial assistance to institution.
Notwithstanding section 76 of the Central Bank of Malaysia Act 2009 and subject to subsection 160(1):
(a) the Bank may provide liquidity assistance upon such terms and conditions as the Bank deems fit, to an institution which in the opinion of the Bank is about to or is likely to suspend payment to any extent; or
(b) where any of the circumstances set out in section 165 exist in respect of an institution, the Bank may, with the prior approval of the Minister, provide financial assistance to another institution or any other person to purchase any shares, or the whole or any part of the business, assets or liabilities, of the first-mentioned institution.
189 Subdivision 8 Moratorium-189. Interpretation.
for the purposes of this Subdivision, "institution" refers to a licensed person or an operator of a designated payment system.
190 Subdivision 8 Moratorium-190. Application for moratorium.
(1) Where the Bank, in the interests of the depositors, policy owners or participants of an institution, has issued a direction prohibiting an institution from carrying on all or part of its business under this Act, the Bank may apply to the High Court and the High Court may, on the application of the Bank, make an order staying for a period not exceeding six months, the commencement or continuance of any proceedings of a civil nature by or against the institution with respect to any of its business and the High Court may, upon hearing an ex parte originating summons filed by the Bank, make the order.
(2) Where an order has been made under subsection (1), the Bank shall notify that fact in the Gazette .
191 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-191. Interpretation.
for the purposes of this Division:
"institution" refers to a licensed person or an operator of a designated payment system;
"liquidator" includes a provisional liquidator, wherever applicable.
192 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-192. Application of Companies Act 1965 in relation to winding up of institution.
The provisions of the Companies Act 1965 in relation to the winding up of companies shall apply to the winding up of an institution, unless specifically provided otherwise in this Division.
193 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-193. Bank to apply for winding up.
Subject to section 262, where any of the circumstances specified in section 165 exist in respect of an institution, the Bank may recommend to the Minister and the Minister may on such recommendation, authorize the Bank to file an application to the High Court for the winding up of an institution and the High Court may order the winding up of an institution pursuant to the application filed by the Bank under this Division.
194 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-194. Restriction on voluntary winding up.
(1) An institution, whether or not its licence or designation has been revoked, or an approved person, shall not be wound up voluntarily without the prior written approval of the Bank.
(2) A registered person shall not be wound up voluntarily without giving prior written notice to the Bank.
(3) Any person who contravenes subsection (1) or (2) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
195 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-195. Winding up by High Court on application by persons other than Bank.
(1) No application for the winding up of an institution or approved person may be presented to the High Court by any person without the prior written approval of the Bank.
(2) Subject to subsection (1), where an application for the winding up of an institution or approved person is presented to the High Court by a person other than the Bank:
(a) that person shall deliver a copy of the application to the Bank at the same time as it is presented; and
(b) the Bank shall be party to the winding up proceedings and shall be entitled to appear and be heard in all proceedings relating to the application and to call, examine and cross-examine any witness.
(3) Any person who contravenes subsection (1) or paragraph (2) (a) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million ringgit or to
196 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-196. Appointment and remuneration of liquidator.
(1) The High Court, where a winding up order is made in respect of an institution pursuant to section 193, shall appoint as liquidator such person as the Bank may specify in its application and shall specify that the remuneration of the liquidator shall be determined by the Bank.
(2) On an application by the Bank, the High Court shall appoint as liquidator such person as the Bank may specify in its application:
(a) to fill a vacancy; or
(b) to remove and replace a liquidator appointed under subsection (1).
197 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-197. Control of liquidator.
Subject to an order of the High Court, a liquidator, other than the official Receiver, appointed under section 196 shall carry out his functions under the direction and supervision of the Bank.
198 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-198. Statement of affairs.
The statement of affairs of an institution as at the date of the winding up order made pursuant to section 234 of the Companies Act 1965 shall be submitted to the Bank at the same time as it is submitted to the official Receiver.
199 Division 3 Winding Up Subdivision 1 General Provisions on Winding Up-199. offences by officers of institution.
Section 300 of the Companies Act 1965 shall apply to an institution as if references in that section to an "officer or a contributory" are references to a director, officer, agent or contributory of an institution.
200 Subdivision 2 Provisions Specific to Licensed Insurers-200. Valuation of assets and liabilities.
In the winding up of a licensed insurer, whether or not its licence is revoked and whether it is insolvent or not, the value of its assets and liabilities, including liabilities in respect of policies, shall be ascertained on such basis as the Bank may determine and the law relating to bankruptcy or insolvency shall not apply to the valuation of its liabilities.
201 Subdivision 2 Provisions Specific to Licensed Insurers-201. Termination of insurance policy.
(1) A policy of a licensed insurer shall cease to remain in force with effect from the date a winding up order has been made in respect of the licensed insurer.
(2) Where a policy ceases to be in force under subsection (1), the policy owner shall only be eligible to claim as a debt due to him:
(a) in the case of a general policy, a refund of a portion of the premium that is commensurate with the remaining period of the policy;
(b) in the case of a life policy, the value of that life policy;
(c) the value of the investments or savings held separately in respect of the policy; or
(d) any other refund or amount,
which shall be ascertained on such basis as may be prescribed by the Bank.
(3) The liquidator shall notify each policy owner and, in the case of a group policy, the group policy owner, about the cessation of an insurance policy by
202 Subdivision 2 Provisions Specific to Licensed Insurers-202. Waiver of strict proof of debt.
Where it appears to the liquidator that by reason of the inadequacy of its documents, or any other circumstances, hardship would be caused if he requires strict proof of debt, he may act on such evidence as he thinks fit and payment of a debt made by the liquidator in good faith to any person as being the person entitled to it shall discharge the liquidator from all liabilities in respect of that debt.
203 Subdivision 2 Provisions Specific to Licensed Insurers-203. Prohibition against issuance of policy.
No director, officer, agent or contributory, past or present, of a licensed insurer which is being wound up after its cessation of insurance business, shall continue to issue a policy.
204 Subdivision 2 Provisions Specific to Licensed Insurers-204. Continuation of life business.
(1) Notwithstanding paragraph 236(1) (a) of the Companies Act 1965, the liquidator of a licensed life insurer:
(a) may carry on its life business with a view to it being transferred as a going concern to another licensed insurer but shall not effect a new policy; and
(b) subject to subsection (2), may transfer its assets and liabilities to another licensed insurer, including liabilities under life policies and Division 4 of Part VI shall apply to the transfer.
(2) The liquidator may, for the purpose of a transfer under paragraph (1) (b) , apply to the High Court for an order to reduce:
(a) the amount of liabilities under life policies of the licensed insurer; or
(b) the amount of its other liabilities,
and the High Court may reduce the liabilities to the extent necessary taking into consideration the v
205 Subdivision 3 Priority of Payments in Winding Up-205. Priority of payments in winding up of licensed investment bank.
In the winding up of a licensed investment bank, the assets of the licensed investment bank shall be available to meet all liabilities of that licensed investment bank in respect of all deposits in Malaysia in priority over all other unsecured liabilities of that licensed investment bank in Malaysia other than the preferential debts set out in subsection 292(1) of the Companies Act 1965 in the order set out in that subsection and debts due and claims owing to the Government under section 10 of the Government Proceedings Act 1956 [Act 359] .
206 Subdivision 3 Priority of Payments in Winding Up-206. Priority of payments in winding up of licensed investment bank carrying on Islamic banking business.
(1) for the purposes of this section, "Islamic deposit" has the same meaning assigned to it in subsection 2(1) of the Islamic Financial Services Act 2012.
(2) Without prejudice to section 205, in the winding up of a licensed investment bank which has been approved under paragraph 15(1) (a) to carry on Islamic banking business:
(a) the assets of the licensed investment bank acquired in the course of its business other than its Islamic banking business, shall be applied to meet the liabilities incurred in the course of its business other than the Islamic banking business, in the order set out in section 205; and
(b) where the assets of the licensed investment bank referred to in paragraph (a) is in surplus after payment has been made to meet its liabilities under paragraph (a), such surplus assets of the licensed investment bank shall be applied to meet the liabilities of the license
207 Subdivision 3 Priority of Payments in Winding Up-207. Application of insurance fund in winding up.
(1) In the winding up of a licensed insurer, the assets of an insurance fund shall be applied to meet its liabilities to policy owners and claimants under policies of that fund and these liabilities shall have priority over unsecured liabilities of that fund, other than preferential debts set out in subsection 292(1) of the Companies Act 1965 and debts due and claims owing to the Government under section 10 of the Government Proceedings Act 1956, to the extent that they are apportioned to the insurance fund.
(2) Subject to subsection (1):
(a) the assets of an insurance fund as established under section 81 shall first be applied to meet the liabilities of that fund;
(b) where the assets of an insurance fund, other than a life fund relating to participating life policies, exceed its liabilities, the surplus assets may be applied to meet the liabilities of its other insurance funds which are in defici
208 Division 4 General Provisions in Relation to Actions Taken by Bank-208. Power of Bank to take action under this Part.
Nothing in this Part shall preclude the Bank from taking any one or more actions that it is empowered to take under this Part.
209 Division 4 General Provisions in Relation to Actions Taken by Bank-209. Qualified financial agreement.
(1) for the purposes of this section, "institution" refers to a licensed person, an approved issuer of a designated payment instrument or operator of a designated payment system.
(2) The parties under a qualified financial agreement may continue to enforce their rights under the qualified financial agreement and shall not be affected by:
(a) the assumption of control of a licensed person or an operator of a designated payment system pursuant to section 167;
(b) the appointment of a receiver and manager of the business, affairs or property of any institution pursuant to section 172; or
(c) the making of an order for the compulsory transfer of the business, assets or liabilities of a licensed person pursuant to section 176,
except during such period as may be prescribed in regulations made under section 260 upon the commencement of the assumption of control or t
210 Division 4 General Provisions in Relation to Actions Taken by Bank-210. Assessor Committee.
(1) Any person aggrieved by the transacted price as a result of:
(a) a sale or disposal of the whole or part of the business or property of a licensed person or an operator of a designated payment system by the Bank or the appointed person under subsection 168(6); or
(b) a compulsory transfer of the whole or part of the business, assets or liabilities of a licensed person pursuant to section 176,
may, within twenty-one days from the date of such sale, disposal or transfer, appeal on the transacted price to the Assessor Committee by submitting an appeal in writing to the Bank.
(2) Where any person appeals under subsection (1), the Bank shall constitute an Assessor Committee consisting of three independent persons as members of the Assessor Committee, drawn from a panel of ten persons appointed by the Minister on the recommendation of the Bank and refer the appeal to the Assesso
211 PART XIV OTHER POWERS OF BANK Division 1 Regulation of Prescribed Financial Institutions-211. Interpretation.
for the purposes of this Division, "financial intermediation activities" includes:
(a) the accepting of deposits;
(b) the giving of any advance, loan or other facility in whatever form or by whatever name called;
(c) leasing business;
(d) factoring business;
(e) the purchase of bills of exchange, promissory notes, certificates of deposit, debentures or other negotiable instruments;
(f) the acceptance of, or the giving of any guarantee in relation to, liability, obligation or duty of any person;
(g) hire-purchase, including hire-purchase transactions pursuant to the Hire-Purchase Act 1967;
(h) acquiring rights or interests in a hire-purchase, leasing or other similar transaction;
(i) any activity that is incidental, ancillary or otherwise facilitates or is closely related to the activities
212 PART XIV OTHER POWERS OF BANK Division 1 Regulation of Prescribed Financial Institutions-212. Power of Minister to prescribe financial institutions.
(1) The Minister may prescribe any person which is not under the supervision or oversight of the Bank and engaging in financial intermediation activities as a prescribed financial institution:
(a) on the joint recommendation by the Bank and the relevant authority which is responsible for the regulation and supervision of such person; or
(b) on the recommendation by the Bank, in any other case,
if such person, in the opinion of the Bank, poses or is likely to pose a risk to financial stability arising from:
(i) its financial intermediation activities which may include the generation of maturity or liquidity transformation, involve imperfect credit risk transfers, create or facilitate excessive leverage or raise concerns of regulatory arbitrage;
(ii) the nature, scope, size, scale or concentration of its financial intermediation activities; or
(iii)
213 Division 2 International And Domestic Transactions-213. Interpretation.
(1) for the purposes of section 214, unless the context otherwise requires:
"designated account" means an account opened in favour of any person by a financial institution as determined by the Bank;
"financial instrument" includes derivatives; "foreign currency" includes:
(a) currency notes or coins which are legal tender in any country, territory or place outside Malaysia;
(b) any right to receive foreign currency:
(i) in respect of any credit or balance at a licensed bank or any other similar institution in or outside Malaysia; or
(ii) from any person in or outside Malaysia; or
(c) any document or device of a kind intended to enable the person to whom the document or device is issued to obtain
214 Division 2 International And Domestic Transactions-214. Measures relating to international and domestic transactions.
(1) The Bank is empowered under this section to safeguard the balance of payments position and the value of the currency of Malaysia.
(2) No person shall undertake or engage in any transaction set out in Schedule 14 except with the written approval of the Bank.
(3) Subject to any direction issued by the Bank under paragraph (6) (e) , the prohibition in subsection (2) in respect of the transactions in paragraph 1 of Schedule 14 shall not apply to any licensed bank.
(4) Unless otherwise expressly provided in this section and Schedule 14, subsection (2) shall apply to:
(a) all persons, classes, categories or descriptions of persons including their nominees or any person acting on their behalf notwithstanding that they are not in Malaysia; and
(b) all acts that are committed in or outside Malaysia including any act which involves, is in association with, or is preparatory to, the
215 Division 2 International And Domestic Transactions-215. Power of Bank to impose levies or charges.
(1) for the purposes of safeguarding the balance of payments position or the value of the currency of Malaysia, regulations may be made under section 260 to impose levies or charges in respect of any transaction specified in Schedule 14, either generally or with conditions or in circumstances set out in the regulations.
(2) Levies or charges imposed pursuant to the regulations referred to in subsection (1) may be:
(a) specific;
(b) a minimum or maximum amount; or
(c) a percentage or proportion of the amount which is the subject matter of the transaction in Schedule 14.
216 Division 2 International And Domestic Transactions-216. Power of Bank, with approval of Minister, to issue directions.
(1) The Bank may, with the approval of the Minister, in the national interest, issue directions to any person in Malaysia, to prohibit, restrict or require the doing of any act as may be specified by the Bank, with or without conditions, in relation to dealings or transactions, with any person resident in a country or territory, or in any currency, as may be specified by the Bank.
(2) Any person for whom the directions are issued under subsection (1) shall comply with the directions notwithstanding any other duty imposed on that person by any contract or international agreement.
(3) No person shall, in carrying out any act in compliance with the directions made under subsection (1), be treated as being in breach of any such contract or international agreement.
(4) Any person who fails to comply with any direction or condition referred to in subsection (1) commits an offence and shall, on conviction, be liable to imprisonment for
217 Division 3 Holiday for Licensed Person-217. Power of Minister to declare holiday for licensed person.
(1) The Minister may, on the recommendation of the Bank, by notice in the Gazette , declare any day to be a holiday for all licensed persons, or for any class, category or description of licensed persons, or for such offices of such licensed persons, throughout, or in any part of, Malaysia, as may be specified in the notice.
(2) No licensed person, or the office of the licensed person specified in the notice, shall carry on any business on any day declared as a holiday for such licensed person under subsection (1) unless the Minister, on the recommendation of the Bank, otherwise approves.
(3) Where a day is declared to be a holiday under subsection (1):
(a) the licensed person or its office specified in the notice is not compellable on such holiday to make a payment or to do any other act that it would not be compellable to do on any day which is public holiday within the meaning of any law relating
218 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-218. Investigation by Bank.
Where the Bank is satisfied or has any reason to believe that any person has committed an offence under this Act, the Bank may cause an investigation to be made and for such purpose may exercise all the powers of investigation provided under this Act.
219 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-219. Appointment of investigating officer.
The Bank may appoint an officer of the Bank or any other person appointed under subsection 7(6) to be an investigating officer to conduct an investigation under this Division.
220 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-220. Powers of investigating officer.
(1) An investigating officer appointed under section 219 shall have all the powers and functions conferred on the Bank under this Part, and where such investigating officer is not an officer of the Bank, he shall, in relation to such powers and functions:
(a) be subject to; and
(b) enjoy such rights, privileges, protection, immunities and indemnities as may be specified in,
the provisions of this Act, the Central Bank of Malaysia Act 2009 or any other written law applicable to an officer of the Bank as if he was an officer of the Bank.
(2) An investigating officer, in exercising his powers and performing his functions, shall be subject to and comply with the directions, controls, instructions, conditions, restrictions or limitations as may be specified by the Bank, orally or in writing, either generally, or in any particular case or circumstance.
(3) The Governor shall
221 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-221. Powers of entry, search and seizure with warrant.
(1) Where it appears to a magistrate, upon written information, on oath and after such inquiry as he considers necessary that there is reasonable cause to believe that:
(a) any premises have been used or are about to be used for; or
(b) there is in any premises evidence necessary to the conduct of an investigation into,
the commission of an offence under this Act, the magistrate may issue a warrant authorizing an investigating officer named in the warrant, at any reasonable time, by day or by night and with or without assistance to enter the premises and if need be by force.
(2) A warrant under subsection (1) may authorize the investigating officer to:
(a) enter any premises and search for, seize and detain any property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information;
(b) h
222 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-222. Powers of entry, search and seizure without warrant.
If an investigating officer is satisfied upon information received that he has reasonable cause to believe that by reason of delay in obtaining a search warrant under section 221 the investigation would be adversely affected or evidence of the commission of an offence is likely to be tampered with, removed, damaged or destroyed, the investigating officer may enter the premises and exercise in, upon and in respect of the premises all the powers referred to in section 221 in as full and ample a manner as if he was authorized to do so by a warrant issued under that section.
223 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-223. List of seized property, etc.
(1) An investigating officer, in the course of his investigation or search, shall:
(a) prepare and sign a list of all property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information seized; and
(b) state in the list the location in which, or the person on whom, the property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information is found or obtained.
(2) The occupant of the premises entered under subsection 221(1) or section 222 in the course of investigation, or any person on his behalf, shall in every instance be permitted to attend during the search, sign the search list or affix his thumb print thereon, and be given a copy of the search list prepared and signed or affixed thumb print under this section.
(3) Where such occupant or person acting on behalf of the occupant unde
224 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-224. Release of seized property, etc.
(1) An investigating officer shall, unless otherwise ordered by any court:
(a) on the close of investigations or any proceedings arising from such investigations; or
(b) with the prior written consent of the Bank at any time before the close of investigations,
release any property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information seized, detained or removed by him or any other investigating officer under this Part, to such person as he determines to be lawfully entitled to the property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information if he is satisfied that it is not required for the purpose of any prosecution or proceedings under this Act, or for the purpose of any prosecution under any other written law.
(2) A record in writing shall be made by the investigating o
225 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-225. Search of person.
(1) An investigating officer may search any person whom he has reason to believe has on his person any property, apparatus, equipment, machinery, computer, computer output, system, data, books, document or information, or other article necessary, in his opinion, for the purpose of investigation into any offence under this Act.
(2) for the purpose of a search of a person under subsection (1), section 221 or 222, an investigating officer may, subject to the provisions of the Criminal Procedure Code [Act 593] , detain such person as may be necessary to have the search carried out, and may remove him in custody to such place as may be necessary to facilitate such search.
(3) An investigating officer making a search of a person under subsection (1) may seize, detain or take possession of any property, apparatus, equipment, machinery, computer, computer output, system, data, books, document, information or article, found upon such per
226 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-226. Obstruction to exercise of powers by investigating officer.
(1) No person shall:
(a) refuse any investigating officer exercising his powers under section 221, 222 or 225, access to any premises or any part of such premises, or fail to submit to the search of his person;
(b) assault, obstruct, hinder or delay any investigating officer in the exercise of his powers under this Part;
(c) fail to comply with any lawful demand of any investigating officer in the execution of his duties under section 221, 222 or 225;
(d) refuse to give to an investigating officer any information which may reasonably be required of him and which he has it in his power to give;
(e) fail to produce to, or conceal or attempt to conceal from, an investigating officer any property, books, other document or article in relation to which the investigating officer has reasonable grounds for suspecting that an offence or breach has been or is being
227 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-227. Requirement to provide translation.
(1) Where an investigating officer finds, seizes, detains or takes possession of any computer, computer output, system, data, books, document or information, in the exercise of any power under this Part, and such books, other document or information or any part thereof is in a language other than the national language or the English language, or in any sign or code, the investigating officer may, orally or in writing, require the person who had the possession, custody or control of such computer, computer output, system, data, books, document or information, to furnish to the investigating officer a translation in the national language or the English language of such computer output, system, data, books, document or information within such reasonable period as the investigating officer may specify, having regard to the length of the computer output, system, data, books, document or information, or other circumstances relating to it.
(2) No pers
228 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-228. Power to examine persons.
(1) Where an investigating officer suspects any person to have committed an offence or a breach under this Act, he may, if in his opinion it is reasonably necessary to do so for the purposes of an investigation into such offence:
(a) order any person in writing to attend before him for the purpose of being examined orally in relation to any matter which may assist in the investigation into the offence or breach;
(b) order any person in writing to produce before him, within the time specified by such officer, any property, apparatus, equipment, machinery, computer, computer output, system, data, books, document, information, article or thing which may assist in the investigation into the offence or breach; or
(c) by notice in writing require any person to furnish a statement in writing made on oath or affirmation setting out therein all such information which may be required under the notic
229 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-229. Service of orders or notices generally, etc.
(1) Any order or notice that is given under this Part, shall, where it is required to be served on an individual, be served by:
(a) delivering it personally to the person for whom it is intended;
(b) delivering it to an adult person at the last-known place of residence, occupation or business of the person for whom it is intended; or
(c) sending it by registered post to the person for whom it is intended.
(2) Any order or notice that is given under this Part shall, where it is required to be served on a body corporate or unincorporate, be served by delivering the order or notice to an officer or agent of the body corporate or unincorporate at its registered address or business address.
(3) If the officer effecting any order or notice under subsection (1) or (2) is satisfied, for reasons to be recorded by him in writing, that the order or notice cannot be serve
230 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-230. Surrender of travel documents.
(1) Notwithstanding any written law to the contrary, an investigating officer may, by notice in writing, require any person who is the subject of an investigation for an offence under this Part, to surrender his travel documents including passport or exit permit in his possession, within such period as specified in the notice.
(2) A notice under subsection (1) shall be served personally to the person to whom it is addressed in accordance with section 229.
(3) A person to whom a notice under subsection (1) is served shall comply with such notice, failing which he may be arrested and taken before a magistrate.
(4) Where a person is taken before a magistrate, unless such person complies with the notice under subsection (1) or satisfies the magistrate that he does not possess a travel document, the magistrate shall by warrant commit such person to prison:
(a) until the expiry of a period of fourteen day
231 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-231. Agent provocateur.
Notwithstanding any law or rule of law to the contrary, in any proceedings against any person for an offence under this Act:
(a) no agent provocateur, whether he is an officer of the Bank or not, shall be presumed to be an accomplice or be unworthy of credit by reason only of his having attempted to commit or to abet, or having abetted or having been engaged in a criminal conspiracy to commit, such offence if the main purpose of such attempt, abetment or engagement was to secure evidence against such person;
(b) any statement whether oral or in writing made to an agent provocateur by any person, including any person who is subsequently charged with an offence under this Act, shall be admissible in evidence and given due weight and consideration at any trial for an offence under this Act; and
(c) a conviction for any offence under this Act solely on the uncorroborated evidence of any agent
232 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-232. Assistance to police or other public officer.
The Bank may at its own initiative, or on the request of a public officer:
(a) supply to a police officer or any other public officer a copy of any books, computer output, data, document or information seized, detained or taken possession of under section 221, 222 or 225, or of any record of examination under paragraph 228(1) (a) , or of any written statement on oath or affirmation made under paragraph 228(1) (c) or of any books, computer output, data, document or information produced under paragraph 228(1) (b) , or otherwise in the course of any examination under paragraph 228(1) (a) , or under any written statement on oath or affirmation made pursuant to paragraph 228(1) (c) , and such police officer or other public officer may make such use of such copy of such record, statement, books, computer output, data, document or information as may be necessary or expedient in relation to the
233 PART XV ENFORCEMENT AND PENALTIES Division 1 Investigation Powers-233. Investigating officer deemed to be public servant and public officer.
An investigating officer shall be deemed to be a public servant for the purposes of the Penal Code [Act 574] , and to be a public officer for the purposes of the Criminal Procedure Code and the Evidence Act 1950 or any other written law which the Minister may, on the recommendation of the Bank, prescribe.
234 Division 2 Administrative Actions-234. Power of Bank to take action.
(1) A person has committed a breach under this Act if the person fails to comply with or give effect to:
(a) any provision of this Act;
(b) any regulations made under this Act;
(c) any order made or any direction issued under this Act by the Bank including an order made under section 94 or a direction issued under section 116 or 156, subsection 214(6) or section 216; or
(d) any standards, condition, restriction, specification, requirement or code under this Act.
(2) The Bank shall have regard to the following matters in determining the appropriate action to be taken in each case:
(a) the effectiveness of the enforcement action to be taken under this Act;
(b) the proportionality of the action to be taken with the breach committed;
(c) deterrence of future breaches of similar nature by othe
235 Division 2 Administrative Actions-235. Lodgment of amount not distributed with Registrar of Unclaimed Moneys.
To the extent that any of the amount paid under paragraph 234(3) (e) or subsection 234(10) has not been distributed by the person in breach after reasonable efforts to notify the aggrieved persons have failed due to the difficulty of notifying the aggrieved persons, such amount shall be lodged with the Registrar of Unclaimed Moneys in accordance with the provisions of the Unclaimed Moneys Act 1965 [Act 370] .
236 Division 2 Administrative Actions-236. Power of Bank to prescribe monetary penalty.
The Bank may, for giving full effect to or for convenient implementation of subparagraph 234(3) (b) (i), or for the purposes of regulatory objectives of this Act, prescribe the following matters as it deems necessary:
(a) classify or designate the breaches under this Act into different categories of breaches; and
(b) fix, in accordance with paragraph (a) , a monetary penalty, or a range of monetary penalties, in respect of each category.
237 Division 2 Administrative Actions-237. Application for appeal of decisions.
(1) Any person who is aggrieved by a decision of the Bank under paragraph 234(3) (b) or (e) may within twenty-one days after the person has been notified of the decision, appeal by filing a notice in writing to the Monetary Penalty Review Committee.
(2) The decision of the Bank under paragraph 234(3) (b) or (e) , as the case may be, shall not take effect until the appeal is disposed of.
(3) The Monetary Penalty Review Committee may decide to confirm the decision of the Bank or require the Bank to reconsider and reach a decision in accordance with the findings of the Committee.
238 Division 2 Administrative Actions-238. Monetary Penalty Review Committee.
(1) There shall be established a committee to be known as the Monetary Penalty Review Committee for the purposes of section 237.
(2) The Monetary Penalty Review Committee shall consist of not less than three but not more than five members appointed by the Minister from amongst non-executive directors of the Bank or other persons.
(3) The Monetary Penalty Review Committee may determine its own procedures.
239 Division 3 Civil Actions-239. Civil action by Bank.
Where it appears to the Bank that there is a reasonable likelihood that any person will contravene or has contravened or will breach or has breached or is likely to fail to comply with or has failed to comply with any:
(a) provisions of this Act;
(b) provisions of any regulations made pursuant to this Act;
(c) order made or direction issued by the Bank under this Act including an order made under section 94 or a direction issued under section 116 or 156, subsection 214(6) or section 216;
(d) standards, condition, restriction, specification, requirement or code made or issued pursuant to any provision of this Act; or
(e) action taken by the Bank under subsection 234(3),
the Bank may institute civil proceedings in the court seeking any order specified under subsection 240(1) against that person whether or not that person has been charge
240 Division 3 Civil Actions-240. Orders by court.
(1) The court may, on an application by the Bank under section 239, make one or more of the following orders:
(a) an order requiring the person to pay an amount which shall not exceed three times:
(i) the gross amount of pecuniary gain made or loss avoided by such person as a result of the contravention, breach or non-compliance; or
(ii) the amount of money which is the subject matter of the contravention, breach or non-compliance,
as the case may be;
(b) an order requiring the person to pay a civil penalty in such amount as the court considers appropriate having regard to the severity or gravity of the contravention, breach or non-compliance, but in any event not exceeding twenty-five million ringgit;
(c) an order:
(i) restraining the person from engaging in any specific conduct; or
(ii) requiring the cessatio
241 Division 3 Civil Actions-241. Civil action to seek compensation.
(1) Where any person:
(a) has been convicted of an offence under this Act or under any other written law; or
(b) has had any offence committed by him compounded under section 253,
and such offence has resulted in, or caused, or subsequent to its commission, results in, or causes, any loss or damage of any nature or in any form to a licensed person, the Bank may institute civil proceedings in court for the purposes of seeking indemnity from the persons referred to in subsection (2).
(2) The following persons shall be jointly and severally liable to indemnify the licensed person in full for any loss or damage to the licensed person:
(a) the person convicted of the offence, or the person whose offence has been compounded under section 253; and
(b) any director, officer or controller of the licensed person,any other person purporting
242 Division 3 Civil Actions-242. Interim orders.
If an application is made to a court for an order under subsection 240(1) or 241(1), the court may, if it deems appropriate, before considering the application, make an interim order of the kind applied for and such order shall be expressed to have effect pending the determination of the application.
243 Division 3 Civil Actions-243. Contravention of court order.
(1) Any person who contravenes an order of the court under subsection 240(1) or 241(3) or section 242 commits an offence and shall, on conviction be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five million ringgit or to both.
(2) Subsection (1) does not affect the powers of the court in relation to the punishment of contempt of court.
244 Division 3 Civil Actions-244. No undertaking as to damages.
Where the Bank makes an application for an order under subsection 240(1) or 241(1), the court shall not, as a condition of the grant of the order, require any undertaking as to damages to be given by or on behalf of the Bank.
245 Division 3 Civil Actions-245. Other actions.
An application made pursuant to subsection 240(1) or 241(1) shall not prejudice any other action that may be taken by the Bank, aggrieved person or licensed person, as the case may be, under this Act or any other law.
246 Division 3 Civil Actions-246. Evidence obtained in investigations may be used in civil proceedings.
(1) Notwithstanding any law, any document or information obtained by the Bank in the exercise of its investigation powers against:
(a) an authorized person, operator of a designated payment system, a registered person or market participant;
(b) any director or officer of the persons referred to in paragraph (a) ;
(c) any agent of the persons referred to in paragraph (a) ; or
(d) any other person,
may be used by the Bank in a civil action instituted by the Bank.
(2) for the avoidance of doubt, any document or information referred to in subsection (1) shall not be inadmissible in any civil proceedings under this Part to which the Bank is a party by reason only that it was obtained by the Bank in the exercise of its investigation powers and the admissibility thereof shall be determined in accordance with the rules of evidence unde
247 Division 4 Criminal Offences-247. Imprisonment.
Where the penalty of imprisonment has been provided for an offence under this Act, such penalty shall not apply to a body corporate convicted of the offence.
248 Division 4 Criminal Offences-248. offences in relation to entries in documents.
(1) No person shall:
(a) make or cause to be made a false entry;
(b) omit to make, or cause to be omitted, any entry; or
(c) alter, extract, conceal or destroy, or cause to be altered, extracted, concealed or destroyed, any entry,
in any book or record, or in any report, slip, statement or other document whatsoever, relating to the business, affairs, transactions, condition, property, assets, liabilities or accounts, of an authorized person, a registered person or an operator of a designated payment system.
(2) No person shall evade the provisions of this Act by altering, forging, destroying, mutilating, defacing, concealing or removing any document.
(3) Any person who contravenes subsection (1) or (2) commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding eight years or to a fine not exceeding twenty-five milli
249 Division 4 Criminal Offences-249. offence committed by any person acting in official capacity.
(1) Where an offence is committed by a body corporate or unincorporate, a person:
(a) who is its director, controller, officer or partner, or was purporting to act in any such capacity; or
(b) who is concerned in the management of its affairs,
at the time of the commission of the offence is deemed to have committed that offence unless that person 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 function in that capacity and to the circumstances.
(2) An individual may be prosecuted for an offence under subsection (1) notwithstanding that the body corporate or unincorporate has not been convicted of the offence whether or not a prosecution has been initiated or a conviction has been obtained against the body corpor
250 Division 4 Criminal Offences-250. offence by employees, etc.
Where a person is liable under this Act to a penalty for any act, omission, neglect or default, such person shall be liable to the same penalty for the act, omission, neglect or default of his employee, director, controller or agent if the act, omission, neglect or default was committed by:
(a) his employee in the course of the employee's employment;
(b) his director in carrying out the function of a director;
(c) his controller in carrying out the function of a controller; or
(d) his agent when acting on his behalf.
251 Division 4 Criminal Offences-251. Seizable offence.
Every offence punishable under this Act shall be a seizable offence, and a police officer not below the rank of Inspector, or an investigating officer appointed under section 219 may arrest without warrant a person whom he reasonably suspects to have committed or is committing the offence.
252 Division 4 Criminal Offences-252. Duty of investigating officer to make over arrested person to police.
An investigating officer who makes an arrest under section 251 shall make over the arrested person to a police officer without unnecessary delay and the arrested person shall be dealt with according to the law relating to criminal procedure as if he had been arrested by a police officer.
253 Division 4 Criminal Offences-253. Power to compound.
(1) The Governor may, with the consent in writing of the Public Prosecutor, offer in writing to compound any offence punishable under this Act or any regulations made under this Act, by accepting from the person reasonably suspected of having committed the offence, such sum of money not exceeding the amount of the maximum fine to which that person would have been liable if he had been convicted of the offence, within such time as may be specified in the offer.
(2) An offer under subsection (1) may be made at any time after the offence has been committed, but before any prosecution for it has been instituted, and if the amount specified in the offer is not paid within the time specified in the offer or within such extended period as the Governor may grant, prosecution for the offence may be instituted at any time after that against the person to whom the offer was made.
(3) Where an offence has been compounded under subsection (1), no pr
254 Division 4 Criminal Offences-254. Attempts, abetments and conspiracies.
(1) Any person who:
(a) attempts to commit an offence under this Act;
(b) does an act preparatory to, or in furtherance of, the commission of an offence under this Act; or
(c) abets or is engaged in a criminal conspiracy to commit (as those terms are defined in the Penal Code) an offence under this Act, whether or not the offence is committed in consequence of it,
commits an offence and is liable to the penalty for that offence.
(2) A provision of this Act which refers to an offence under a specific provision of this Act shall be read as including a reference to an offence under subsection (1) in relation to the offence under that specific provision.
255 Division 4 Criminal Offences-255. Prosecution.
No prosecution for an offence under this Act shall be instituted except with the written consent of the Public Prosecutor.
256 Division 5 General Matters-256. Protection in relation to disclosure of information to Bank.
(1) Where a person discloses in good faith to the Bank, his knowledge or belief or any document or information that a breach or contravention has been committed or is about to be committed under this Act:
(a) such person shall not be liable for a breach of a duty of confidentiality imposed by any law, contract or rules of professional conduct;
(b) it shall be a defence in an action, a suit, prosecution or proceeding that is brought, instituted or maintained in any court or before any other authority against the person who made the disclosure to the Bank that in his belief the disclosure was necessary for the carrying into effect the provisions of this Act; or
(c) no contractual or other rights or remedy may be enforced against the person on the basis of disclosure.
(2) Any document or information disclosed to the Bank under subsection (1) and the information and ident
257 Division 5 General Matters-257. Evidential provision.
In any criminal or civil proceedings under this Act:
(a) any statement purporting to be signed by the Governor or any other person authorized to perform the functions of the Bank on its behalf, which forms part of or is annexed to any letter, register, record or document, however expressed, described or represented; or
(b) the production of a printed copy of a standard, specification, order in writing, direction, instruction, notice, requirement, condition or restriction, letter, register, record, document or any other instrument specified or issued pursuant to this Act,
shall, until the contrary is proved, be evidence of any fact stated therein.
258 Division 5 General Matters-258. Power of Bank to publish information.
The Bank may, where it thinks necessary, publish in such form and manner as it thinks fit, any information in relation to:
(a) any enforcement action taken under this Act including criminal proceedings, compounding, civil actions and administrative actions; and
(b) the outcome of actions referred to in paragraph (a) including the outcome of any proceedings, settlement in or out of court in relation to any breach or contravention of provisions of this Act.
259 PART XVI GENERAL PROVISIONS-259. Enforceable undertakings.
(1) The Minister or the Bank may accept a written undertaking given by a person in connection with a matter in relation to which the Minister or the Bank, as the case may be, has a power or function under this Act.
(2) The written undertaking accepted under subsection (1) may be varied or withdrawn by the person giving the undertaking with the consent of the Minister or the Bank, as the case may be.
(3) If the Bank considers that a person who has given a written undertaking has breached any of the terms of the undertaking:
(a) given to the Bank, the Bank may apply; or
(b) given to the Minister, the Bank may recommend to the Minister to apply,
to the High Court for an order under subsection (4) by way of originating summons.
(4) If the High Court is satisfied that a person has breached a term of the undertaking, the High Court may make any or all of the followin
260 PART XVI GENERAL PROVISIONS-260. Regulations.
(1) The Minister may, on the recommendation of the Bank, make such regulations as may be necessary or expedient for:
(a) giving full effect to the provisions of this Act;
(b) carrying out or achieving the regulatory objectives and purposes of this Act;
(c) the further, better or more convenient implementation of the provisions of this Act; or
(d) providing for any supplemental, incidental or consequential matters in relation to this Act.
(2) Without limiting the generality of subsection (1), regulations may be made:
(a) to provide for control by the Bank by supervision, regulation, restriction, prohibition, or otherwise howsoever, with respect to the provision of finance, financial intermediation activities as defined in section 211, banking services or insurance services supplied or carried on by persons other than an au
261 PART XVI GENERAL PROVISIONS-261. Provisions relating to approvals, consents, standards, codes, specifications, notices, requirements, directions or measures.
(1) Unless otherwise expressly provided, any approval or consent granted, or any standards, code, specification, notice, requirement, direction or measures specified or issued, under this Act:
(a) may be either general or specific;
(b) may be amended or revoked by the Bank or the Minister, as the case may be; or
(c) shall be issued or communicated in such manner as the Bank thinks appropriate and shall be valid for all purposes.
(2) Any approval or consent under subsection (1) may be:
(a) absolute or conditional; or
(b) limited so as to expire on a specified date, unless renewed.
262 PART XVI GENERAL PROVISIONS-262. Opportunity to make representations.
(1) Where:
(a) the Minister, on the recommendation of the Bank, proposes to take any action against any person under subsection 13(1), 20(1) or (2), 30(3) or section 193; or
(b) the Bank proposes to take any action against any person under subsection 13(1), 20(1), (2) or (3), section 21, subsection 30(3), section 34 or 39, subsection 94(2), 116(2) or (3), 120(1), 140(5) or 156(1), section 162, subsection 167(1) or 172(1) or against any person in breach referred to in subsection 234(1),
the Bank shall serve on such person a written notice of the proposed action.
(2) The written notice under subsection (1) shall set out:
(a) the action that the Minister or the Bank, as the case may be, proposes to take and the grounds for such action;
(b) the period within which the person referred to in subsection (1) may make a written representat
263 PART XVI GENERAL PROVISIONS-263. Exemptions.
The Minister may, on the recommendation of the Bank and provided that it is consistent with the objects and functions of the Bank under the Central Bank of Malaysia Act 2009 or the regulatory objectives of this Act, by an order published in the Gazette , exempt any particular person or any class, category or description of persons, from all or any of the provisions of this Act, for such duration, and subject to such conditions, as may be specified by the Minister in the order.
264 PART XVI GENERAL PROVISIONS-264. Power of Minister to amend Schedule.
The Minister may, on the recommendation of the Bank, from time to time, by an order published in the Gazette, amend any provision in Schedules 1, 2, 4, 5, 6, 7, 9, 11, 12 and 13 of this Act and upon such publication, such provision as amended shall come into full force and effect and shall be deemed to be an integral part of this Act as from the date of such publication or from such later date as may be specified in the order.
265 PART XVI GENERAL PROVISIONS-265. Decision of Minister to be final.
Any decision made by the Minister under this Act shall be final.
266 PART XVI GENERAL PROVISIONS-266. Power of Bank to issue guidance.
The Bank may issue guidance in writing to any person or to any class, category or description of persons consisting of such information, advice or recommendation as it considers appropriate:
(a) with respect to the provisions of this Act;
(b) for the purpose of carrying out or achieving the regulatory objectives of this Act; or
(c) with respect to any other matter which, in the opinion of the Bank, is desirable to give information, advice or recommendation.
267 PART XVI GENERAL PROVISIONS-267. Protection against suits and legal proceedings.
No action, suit, prosecution or other proceeding shall lie or be brought, instituted, or maintained in any court or before any other authority against:
(a) the Minister;
(b) the Bank;
(c) the Governor;
(d) the Deputy Governor; or
(e) any of its director, officers or employees or any person acting on behalf of the Bank,
for or on account of, or in respect of, any act done or statement made or omitted to be done or made, or purporting to be done or made or omitted to be done or made, in pursuance or in execution of, or intended pursuance or execution of, this Act, or any order in writing, direction, instruction, notice or other thing issued under this Act if such act or such statement was done or made, or was omitted to be done or made, in good faith.
268 PART XVI GENERAL PROVISIONS-268. Application of Companies Act 1965.
Where an authorized person, a registered person, an operator of a designated payment system or a person prescribed as a prescribed financial institution under section 212 is a corporation to which all or any of the provisions of the Companies Act 1965 apply, such provisions shall be in addition to the provisions of this Act and not in derogation thereof, but where there is any conflict or inconsistency between the provisions of the Companies Act 1965 and this Act in their respective application to the person or operator, the provisions of this Act shall prevail.
(2) Where any difficulty or doubt arises in the application of subsection (1) in relation to any particular authorized person, registered person or operator of a designated payment system, or any particular matter or circumstance, or generally, the Minister may on the reference of the difficulty or doubt to him by the Bank, resolve the same by a direction in writing.
269 PART XVI GENERAL PROVISIONS-269. Application of certain provisions of Act to Labuan entities.
(1) for the purpose of this section,
"Labuan Financial Services Authority" means Labuan Financial Services Authority established under section 3 of the Labuan Financial Services Authority Act 1996 [Act 545] . (2) Without prejudice to the generality of Division 2 of Part XIV, the provisions in such Division shall apply to any person who is under the supervision or oversight of the Labuan Financial Services Authority and the Bank may exercise such powers and perform such functions under this Act to ensure compliance with Division 2 of Part XIV by such person.
(3) for the purposes of the Bank exercising oversight over a financial group, a reference to:
(a) "subsidiary" in sections 115 and 116; and
(b) "related corporation" in Parts X and XI,
shall be deemed to include a person who is under the supervision or oversight of
270 PART XVI GENERAL PROVISIONS-270. Breach or contravention not to affect contract, agreement or arrangement.
Except as otherwise provided in this Act, or in pursuance of any provision of this Act, no contract, agreement or arrangement, entered into in breach or contravention of any provision of this Act shall be void solely by reason of such breach or contravention:
Provided that nothing contained in this section shall affect any liability of any person for any administrative, civil or criminal actions under this Act in respect of such breach or contravention.
271 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-271. Repeal.
The Banking and Financial Institutions Act 1989, the Exchange Control Act 1953, the Insurance Act 1996 and the Payment Systems Act 2003 are repealed.
272 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-272. Savings and transitional.
Notwithstanding section 271:
(a) any rule, regulation, order, notification or other subsidiary legislation made and any approval, authority, consent, decision, direction, exemption, notice, order, permission, recommendation, requirement, specification or other executive act granted or done under the repealed Acts and in force or having effect before the appointed date, shall be deemed to have been made, granted or done under a corresponding provision in this Act or a corresponding provision in any direction issued pursuant to section 156, subsection 214(6) or section 216, and shall continue to remain in full force and effect in relation to the person to whom it applied until amended or revoked, except those subsidiary legislation set out in Schedule 16 which are deemed to have been revoked;
(b) every guideline, direction, circular or notice under the repealed Acts in relation to any matter which correspond
273 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-273. Savings in respect of licences granted under repealed Acts.
(1) Subject to the provisions of subsection (2):
(a) a licence granted to a person by the Minister:
(i) under subsection 6(4) of the repealed Banking and Financial Institutions Act 1989 to carry on banking business or merchant banking business, as the case may be, under that Act; and
(ii) under section 16 of the repealed Insurance Act 1996 to carry on insurance business under that Act,
shall be deemed to be a licence granted under section 10 authorizing such person to carry on banking business, investment banking business or insurance business, as the case may be;
(b) a licence granted to a person:
(i) by the Minister under subsection 6(4) of the repealed Banking and Financial Institutions Act 1989 to carry on money-broking business; and
(ii) by the Bank under section 17 of the repealed Insurance Act 1996 to carry on insurance
274 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-274. Savings in respect of Islamic financial business.
The following persons shall be deemed to be approved under subsection 15(1):
(a) a licensed bank or licensed investment bank which has consulted the Bank under section 124 of the repealed Banking and Financial Institutions Act 1989, and has obtained the approval of the Bank to carry on Islamic banking business;
(b) an approved issuer of a designated payment instrument which has obtained a written approval under subsection 25(1) of the repealed Payment Systems Act 2003 for the issuance of Islamic designated payment instruments; and
(c) an operator of:
(i) a payment system which has been notified under subsection 5(1) of the repealed Payment Systems Act 2003 provided that the business of the operator of that payment system corresponds to a payment system set out in Part 1 of Schedule 1 of the Islamic Financial Services Act 2012; or
(ii) a designated payment syste
275 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-275. Savings and transitional provision in respect of specific provisions of repealed Insurance Act 1996.
Notwithstanding the repeal of the Insurance Act 1996 under section 271:
(a) subsections 147(4) and (5), and sections 150 and 151 of the repealed Insurance Act 1996 shall continue to remain in full force and effect until such date to be appointed by the Minister in accordance with subsection 1(2) for the coming into operation of section 129 and Schedule 9;
(b) sections 144 and 224 of the repealed Insurance Act 1996 shall continue to remain in full force and effect until such sections are repealed by the Minister by notification in the Gazette ; and
(c) an insurance fund established and maintained under section 38 of the repealed Insurance Act 1996 shall be deemed to have been established and maintained under section 81.
276 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-276. Conversion to single insurance business.
A licensed insurer, other than a licensed professional reinsurer, lawfully carrying on both life business and general business under the repealed Insurance Act 1996 shall comply with subsection 16(1) within five years of the appointed date or such longer period as may be specified by the Minister, on the recommendation of the Bank, by notice in writing to the insurer upon its written application before the expiry of the five years.
277 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-277. Designated payment systems deemed certified.
The Real Time Electronic Transfer of Funds and Securities System or RENTAS and the Sistem Penjelasan Informasi Cek Kebangsaan secara Elektronik or eSPICK, which were prescribed as designated payment systems under the Payment Systems (Designated Payment Systems) Order 2009 [P.U.(A) 3/2009] in force before the appointed date shall be deemed to be certified designated payment systems under this Act.
278 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-278. Savings in respect of approvals granted, notification given and prescription made under repealed Payment Systems Act 2003.
(1) An operator of a payment system who has received a written notification under subsection 5(1) of the repealed Payment Systems Act 2003 shall be deemed to have been approved under section 11 or deemed to be registered under subsection 18(1) respectively, provided that the business of the operator of that payment system corresponds to either a payment system set out in Division 1 of Part 1 of Schedule 1 or a payment system set out in Part 2 of Schedule 1.
(2) An issuer of a designated payment instrument who has obtained a written approval under subsection 25(1) of the repealed Payment Systems Act 2003 shall be deemed to have been approved under section 11 in respect of the issuance of that designated payment instrument.
279 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-279. Savings in respect of interest in shares.
(1) Where a person holds five per cent or more of interest in shares of a licensed person on the appointed date, but was not required to obtain an approval under section 45 of the repealed Banking and Financial Institutions Act 1989 or section 67 of the repealed Insurance Act 1996, as the case may be, such person shall be deemed to be approved under paragraph 90(3)(a) provided that he submits such documents or information as may be specified by the Bank within six months after the appointed date.
(2) Where an individual has been approved by the Minister under section 67 of the repealed Insurance Act 1996 to hold interest in shares of a licensed person of more than the percentage specified in section 92, such holding shall be deemed to be lawful and valid for a period of five years after the appointed date and such individual shall, before the expiry of such period, take necessary actions to comply with section 92.
280 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-280. Savings in respect of financial holding company.
(1) A company which has been approved by the Minister under section 45 or 46 of the repealed Banking and Financial Institutions Act 1989 to hold more than fifty per cent of interest in shares of a licensed bank or licensed merchant bank as defined in subsection 2(1) of that Act and has been designated by the Bank as a financial holding company or bank holding company, as the case may be, shall be deemed to be approved as a financial holding company under subsection 112(3).
(2) Where the Bank has not designated a financial holding company or bank holding company for a licensed bank or licensed merchant bank before the appointed date, a company which holds more than fifty per cent of interest in shares of such licensed bank or licensed merchant bank shall submit an application to the Bank for it to be approved as a financial holding company within a period of twelve months from the appointed date or such longer period as may be specified by the B
281 PART XVII REPEAL, SAVINGS AND TRANSITIONAL-281. Savings in respect of deposits accepted by co-operative societies.
(1) Subject to the provision of this section, nothing contained in sections 137 and 138 shall render invalid any deposit accepted lawfully by a co-operative society from a person who is not a member of such co-operative society before the appointed date provided that such co-operative society shall, within six months from the appointed date or such longer period as may be specified by the Bank, submit an application to the Bank together with such documents or information as may be specified by the Bank for it to continue accepting deposits from non-members.
(2) The Bank may approve, with or without conditions, or reject the application referred to in subsection (1) and a co-operative society so approved shall comply with any condition imposed on it by the Bank.
(3) The Bank may grant an approval under subsection (2) if the Bank is satisfied that such co-operative society has given a written undertaking that it will comply with such cond
Elevate your legal practice with advanced AI-driven research and drafting solutions. Experience unmatched efficiency, precision, and security, tailored exclusively for legal professionals.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
AI Assistant
