When I tell people that I’m a lawyer, they often respond with, “Oh, you must have a good memory. That’s so much to memorise.”

I believe it’s more important to understand and apply the law rather than memorise it. After all, you can always refer to online resources or statute books to find the relevant legislation.

As a corporate lawyer, there are a few sections in the Companies Act 2016 that I frequently refer to when working on transactions or corporate exercises:

When a transaction involves issuance of shares

• Section 75 on directors’ powers to allot shares with prior approval of shareholders
• Section 76 on allotment of shares with shareholders’ approval

When directors are interested in a transaction

• Section 221 on disclosure of directors’ interest in contracts.

This provision should be considered when reviewing directors’ resolutions where there are directors interested in the contracts to be entered by the company.

• Section 222 on restriction on a director of a company who is interested in a contract to be entered by the company from voting on the contract and exceptions to the restriction.

Shareholders’ approval required for certain transactions

• Section 223 on shareholders’ approval required for (a)the acquisition by a company of an undertaking or property of a substantial value; or (b) the disposal of a substantial portion of the company’s undertaking or property.
• Section 228 on shareholders’ approval required for “related party transactions”.

Understanding these key provisions in the Companies Act 2016 and knowing when to refer to them is essential for providing accurate and effective legal advice.

#MalaysianCorporateLawyer

This post first posted on LinkedIn on 6 July 2024.