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The Securities Commission Malaysia released the new Malaysian Code on Corporate Governance 2017 ("MCCG"). The new MCGG, which replaced the 2012 code, came into operation on 26 April 2017. It introduces substantial changes and recommendations with a view of raising the standards of corporate governance of companies in Malaysia. The MCCG now employs the CARE approach (abbreviated from the term 'Comprehend, Apply and Report') by shifting from the 'comply or explain' method in the 2012 code to an 'apply or explain an alternative' method. This is believed to allow greater flexibility in the application of the best practices.
The new MCCG also adopts a proportionate application to companies depending on size, complexity and suitability. While the MCCG applies to all listed companies in Malaysia, certain practices are only applicable to 'Large Companies', which are companies on the FTSE Bursa Malaysia Top 100 Index or companies with market capitalisation of RM2 billion and above at the start of their financial year. In addition, the MCCG now expressly encourages non-listed entities including state-owned enterprises, SMEs and licensed intermediaries to embrace the MCCG to enhance accountability, transparency and sustainability.
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A company which operates a local private college has become the first data user to be charged for alleged breach of the Malaysian Personal Data Protection Act 2010 ("PDPA"). The company was charged in the Sessions Court for processing personal data of its former employees without a valid certificate of registration issued by the Personal Data Protection Department ("PDPD"), in contravention of section 16(1) of the PDPA. Section 16(1) requires certain classes of data users to be registered, and to be issued with a valid certificate of registration by the PDPD.
This marks the commencement of the enforcement phase of the PDPA by the PDPD and the Personal Data Protection Commissioner, Puan Khalidah binti Mohd Darus.
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The Personal Data Protection Commission (the "Commissioner") launched a public consultation exercise on the proposed "Personal Data Protection (Transfer Of Personal Data To Places Outside Malaysia) Order 2017" (the "Proposed Order"). The consultation exercise ended on 4 May 2017.
The Proposed Order is a "White List" which permits the transfer of personal data to certain jurisdictions outside Malaysia, in accordance with Section 129(1) of the Personal Data Protection Act 2010 ("PDPA"). The effect of this "White List" (once it is officially issued by the Commissioner, and comes into legal effect) is that Data Users will be permitted to transfer personal data to the jurisdictions that have been identified, and will no longer be required to fulfill the prescribed conditions under Section 129(3) prior to the transfer of personal data to the said jurisdictions. These conditions include: (i) obtaining consent of the Data Subjects prior to transfer of personal data outside Malaysia; (ii) undertaking reasonable precautions and exercising due diligence to ensure that the recipient place will not process personal data in any manner which would contravene the PDPA.
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In April 2017, the First Reading of the Commercial Vehicles Licensing Board (Amendment) Act 2017 ("CVLBA") was tabled in the Malaysian Parliament. The amendment act is intended to regulate e-hailing services such as Uber and Grab. Under the CVLBA, e-hailing services will require a licence to carry out operations.
Clause 2 of the CVLBA bill introduces new definitions of "e-hailing vehicle", "intermediation business" and "intermediation business licence". E-hailing vehicles have been defined as "a motor vehicle…used for the carriage of persons on any journey in consideration of a single or separate fares for each of them, in which the arrangement, booking or transaction and the fare for such journey are facilitated through an electronic mobile application provided by an intermediation business", while an "intermediation business" refers to the business of "facilitating arrangements, bookings or transactions of an e-hailing vehicle".
According to the bill, intermediation businesses require a new category of licence, termed an "intermediation business licence" to operate. The intermediation business licence will be issued by the Land Public Transport Commission (SPAD). Applicants will have to pay a fee and must provide complete information of their financial standing to prove their ability to maintain and operate the intermediation business. Operating an intermediation business without a license is an offence punishable by a fine not exceeding RM500,000 or imprisonment not exceeding 3 years or both.
The Second Reading of the CVLBA is expected to be tabled in the Dewan Rakyat in July.
In June 2017, the Deputy Prime Minister of Malaysia, Dato' Seri Dr. Ahmad Zahid Hamidi announced that the Malaysian Government has handed a draft bill to the Attorney General in relation to a new law aimed at protecting Malaysians from cybersecurity threats.
The new law is aimed at aiding the government in "combating all sorts of cybercrime" including the recruitment and financial sourcing by terrorist groups, money laundering and online gambling. The proposed law also places the National Cyber Security Agency ("NCSA") under the jurisdiction of the National Security Council ("NSC") to ensure more "coordinated action against cybersecurity threats in Malaysia", and empowers the NCSA to deal with cyber crimes.
The bill will be tabled in the next Parliament sitting from July to August.
The Tourism Tax Act came into operation on 1 July 2017. The Act introduces a 'tourism tax' which will be charged on tourists staying at any "accommodation premises" made available by an operator. The tourism tax regime will be administered by the Royal Malaysian Customs Department (the "Customs").
The tourism tax will be collected from all types of premises used as accommodation for tourists, such as registered hotels and inns. Rates start from RM2.50 a room each night for a non-rated accommodation to RM20 a room each night for a five-star accommodation. The tourism tax applies to all guests, regardless of their nationality or purpose of travel (whether holiday or business).
According to newspaper reports, the tourism tax is expected to bring in RM654.62mil (assuming a 60 per cent occupancy rate at the more than 11 million hotel rooms nationwide). It is also reported that the tourism tax will be used to develop the tourism industry, namely, the enhancement of tourism infrastructure and facilities, as well as tourism promotional activities and campaigns for the country.
Any person operating accommodation premises in Malaysia will be required to register with the Customs within 30 days from the date of coming into force of the Act. A failure to comply with the registration requirements is an offence.
However, the Tourism Tax Act does give the Minister of Finance the power to exempt persons or class of persons from the imposition of the tourism tax.
In Malaysia, right to property is subject to the statutory power of the State Authority to acquire land compulsorily from land owners under the Land Acquisition Act 1960 ( "Act"). Therefore, it is paramount and crucial that land owners whose lands have been compulsorily acquired are entitled to adequate compensation under the constitutional safeguard of Article 13 of the Federal Constitution.
A recent Federal Court decision in two cases of Semenyih Jaya Sdn Bhd; Amitabha Guha and Parul Rani Paul v. Pentadbir Tanah Daerah Hulu Langat (which were heard together) examined and entrenched this constitutional safeguard of adequate compensation.
In this case, the Federal Court declared Section 40D of the Act to be unconstitutional and invalid as the Act effectively imposes on a High Court Judge (when reviewing the Land Administrator's award of compensation on an appeal) a duty to rubber-stamp the decision / opinion of the two assessors (who are qualified valuers sitting in open Court with the Judge) on the amount of compensation for the land acquired, thereby taking away the judicial power from the High Court Judge.
However, the Federal Court's declaration will only bind pending cases at first instance or at the appellate stage – all proceedings involving compensation in land acquisition matters which had taken place and been determined under Section 40D of the Act prior to the date of this judgment of the Federal Court (i.e. 20 April 2017) will remain status quo.
Click here to read the article on this, titled "Landmark ruling on compensation in compulsory land acquisition", penned by Christopher Lee & Ong's Heng Yee Kiat. This was featured in the 2 May 2017 issue of the Sun.
Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only
intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice.
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Christopher & Lee Ong
Level 22, Axiata Tower ,
No. 9 Jalan Stesen Sentral 5
Kuala Lumpur Sentral,
50470 Kuala Lumpur, Malaysia
www.christopherleeong.com
Contacts: Lee Hock ChyeManaging PartnerD +603 2273 1919F +603 2273 8310hock.chye.lee@christopherleeong.comYon See TingPartnerD +603 2278 8311F +603 2278 8322see.ting.yon@christopherleeong.comFiona SequerahPartnerD +603 7958 8310F +603 7958 8311fiona.sequerah@christopherleeong.comLim Wee HannPartnerD +65 62320606wee.hann.lim@rajahtann.comYau Yee MingPartnerD +603 2278 8311F +603 2273 8322yee.ming.yau@christopherleeong.comKuok Yew ChenPartnerD +603 7958 8310F +603 7958 8311yew.chen.kuok@christopherleeong.com| Rajah & Tann Asia is a network of legal practices based in Asia. |
Member firms are independently constituted and regulated in accordance with relevant local legal requirements. Services provided by a member firm are governed by the terms of engagement between the member firm and the client. |
This update is solely intended to provide general information and does not provide any advice or create any relationship, whether legally binding or otherwise. Rajah & Tann Asia and its member firms do not accept, and fully disclaim, responsibility for any loss or damage which may result from accessing or relying on this update. |
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