Learn Right Way of Appointing a Nominee Director in Malaysia and Stay in Compliance
Did you know that in the absence of a company director, there are other viable substitutes? Nominee director services can prove to be an effective solution. Suppose you own a company, or you were previously educated on its statutory nature. In that case, you will know that every company registered and depends on the type of company, is required to have a set number of company directors. This is a legal requirement. In events where existing directors wish to exit, if it affects the number of required directors, a replacement will be needed first before the existing director can be abdicated from his or her position. This is where nominee director services come in. Learn the right way of appointing a Nominee Director in Malaysia and stay in compliance.
What Exactly is a Nominee Director?
Every company director will eventually leave their positions due to a variety of voluntary and involuntary reasons. However, regardless of the reason, the company and its stakeholder still, by legal requirements (the Companies Act), need its set number of company directors. It is up to them to decide if they wish to find another director or employ nominee director services.
In the simplest of explanation, a nominee director is someone from a firm you hire who will legally take up the position of the company director. However, there are distinctions between this approach compared to the conventional. Nominee directors will fulfill the statutory requirements for your company to ensure that your company complies. They will not, however, be actively involved in your company’s management and affairs. Leaving your company’s management the freedom to handle these aspects.
What Are the Steps?
In Malaysia, there are nominee director services to choose from. Your company has the liberty of selecting a nominee director service provider of its choice, and in doing so, there are several details that one should know.
Choosing the Right Firm
It is crucial to choose a reputable, recognized, and accredited corporate service provider. Getting the wrong nominee director and its service provider can also bring detriments to your company. Choosing the right service provider can help ensure that your company is in full compliance with the law and doing things right, given the expertise of these respectable firms.
Upon confirmation of employing such services, your company will need to pay a security deposit for each nominee director. In some cases, the deposit required is less if your company is in good standing based on the provider’s specific parameters. The inverse is also sometimes true; if your company has significant issues, the deposit will be slightly higher. This is true when your company has high external debt, high share capital, needs to apply for a license for operation, or if your company consists of many foreign workers.
Know What to Expect
As previously mentioned, nominee directors will only serve to fulfill the statutory requirements. Nominee directors will not be involved in; management, bank signatories, business, invoice signatory, contract signatory, and legal signatory. These are up to the management of the company itself.
Usually, you can terminate these services at any time your company deems appropriate. This provides a company with the flexibility and freedom to change its leadership structure at will.
Choose Your Director Today!
3E Accounting Malaysia is a reliable Firm with experts from various disciplines and has a proven track record of success in appointing nominee directors. Let us help your company realize and achieve its potential. Consult us here today to learn more about 3E Accounting Malaysia’s Nominee Director Services!