Sendirian Berhad Company (Sdn. Bhd.) or also known as Malaysian Private Limited Company is one of two types of companies limited by shares. Establishment, conduct and closure of these companies are regulated by the Companies Act 2016.
The liability of sdn bhd company is limited. It is limit to the amount paid by its owner only. If the owner has fully paid his shares, he is no longer need to contribute money to the company even in the event of its bankruptcy.
Sdn Bhd company also has a separate legal entity like a normal company. They can borrow, buy, rent, enter into contracts, sue, be sued, own property and real estate in the company name without involving its owner’s name.
All matters relating to the establishment of the Sdn Bhd company until its closure should be done at the registrar of companies office or also known today by the name of the Company Commission of Malaysia (CCM) which has its headquarters at Menara SSM, KL Sentral, Kuala Lumpur.
In order to set up a sdn bhd company, a minimum of 1 directors of the company who have a residential address in Malaysia is needed. In addition, the minimum 1 shareholders are required to complete the incorporation. However, the directors and shareholders of the company can be among the same individual.
Sdn Bhd company is required to appoint at least a company secretary as stated in the Companies Act 2016 to whether to employ a company secretary to work with the company (internal company secretary) or seek the services of the company secretary (external company secretary).
At the end of every year, the Sdn Bhd company is required by the Companies Act 2016 to:
- Lodge a company’s annual report to the CCM
- Complete the audited reports, distribute to the members and lodge it to CCM
The company’s failure to comply for two mandatory requirements above may cause the company and its directors be compounded by CCM and if convicted in court can lead to a higher penalty.
Sdn Bhd company will continue to exist even with any changes with all of its shareholders. It is also will not close despite the death of all of its owner. It will continue to exist unless the proper closure procedure against it was done either through the CCM or the courts.
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