(File pix) Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) legal affairs committee chairman Michael Chai. (pix by SURIANIE MOHD HANIF)

KUALA LUMPUR: The new Companies Act 2016 and Companies Regulations 2017, which came into effect on January 31, 2017, has reduced cost of doing business, especially for small and medium-sized enterprises (SMEs).

Since their introduction, many business-friendly policies come into effect, said Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) legal affairs committee chairman Michael Chai.

“One of the major changes is a ‘single member and single director company’ as compared with the previous requirement of two directors and members,” he told reporters at a preview of an ACCCIM seminar here today.

Chai, who is also a legal practitioner, noted that the Companies Act 2016 accords directors better protection if they are operating as a sole proprietor, or in a partnership because the liability will now be on the company, and not on the individual.

He also highlighted that there are liberalising measures introduced, such as private companies, which no longer require directors to hold annual general meetings.

“Basically, this new law lowers the cost of doing business, especially for small entities.”

Chai went on to explain tha the Companies Act 2016, which replaces the Companies Act 1965, has entrusted heavier responsibilities on company directors with penalties raised to RM3 million and jail sentences lengthened to five years.

ACCCIM’s seminar titled ‘the new Companies Act 2016: 10 critical issues SMEs must prepare for’ will be held at its premises here on 7th July 2017. The main speaker is Lee Shih, partner of Skrine & Co and author of a popular bilingual book titled ‘Companies Act 2016.’