The New Year brought new beginnings to the Malaysian capital market when the Securities Commission (SC) introduced new guidelines that were specially designed to make Malaysia a preferred listing destination and to raise the standard of advisory and due diligence conduct by market participants.
New guidelines were introduced to liberalise the offer of equity and equity linked securities in the Main and Second Board of Bursa Malaysia and MESDAQ. The new guidelines brought swift and significant changes to past regulatory policies and practices. Just to cite a couple - from this year onwards, applicants in the real property development sector are no longer subject to the requirement to possess a minimum land bank of 500 acres. Also, the erstwhile mandatory requirement to obtain SC's prior approval to carry out a material acquisition of assets by a listed company for purposes its core business is otiose, unless, however, consideration for such acquisition involves the issuance of securities.
The new guidelines also introduced sound measures to enhance investors' protection. Essentially, the new guidelines prescribe the qualification and competency levels of parties who act as principal advisers. The new guidelines also reinforce the expectations of the SC on issuers, advisers and experts in their underlying obligation to ensure that all information furnished to investors is true, accurate and contains no material non-disclosure so that reliance can be safely placed by investors on such information in their decision making. Detailed mandatory obligations of issuers, advisers and experts in corporate proposals and a reminder of their statutory accountability to SC and investors are included in the new guidelines.
The latest action by SC underpins its serious commitment towards shaping the Malaysian capital market into one that boasts of size, quality and high competitive environment.
Written by David Lee
Tay & Partners
6th Floor, Plaza See Hoy Chan,
Jalan Raja Chulan
50200 Kuala Lumpur, Malaysia
Phone: +603-2050 1888
Fax: +603-2031 8618
E-mail: david.lee@taypartners.com.my
Website: www.taypartners.com.my