MACC Launches Guidelines on Adequate Procedures
The new Guidelines on Adequate Procedures will take effect from 1 June 2020, and is expected to prepare commercial organisations for the future. The guidelines were issued pursuant to subsection (5) of Section 17A of the Malaysian Anti-Corruption Commission Act 2009 (Act 694) (MACC Act 2009). This was stated in the MACC Amendment Act 2018. The Guidelines on Adequate Procedures was launched by Malaysian Prime Minister Tun Dr Mahathir Mohamad on 10 December 2018.
The guidelines are aimed at assisting commercial organisations better understand what adequate procedures should be implemented. This will help minimise the occurrence of corrupt practices relating to their business activities, thereby safeguarding these businesses against unwanted issues. The Guidelines on Adequate Procedures was derived on the basis of 5-principles. These principles may be used as reference points for any anti-corruption policies, controls and procedures which the organisation may choose to implement. The goal of these guidelines is to have adequate procedures in place as part of the statutory provisions requirement.
The Classification of Commercial Organisations
Under Section 17A, commercial organisations are classified as the following:
- A company which has been incorporated under the Companies Act 2016 and carries on a business in Malaysia and elsewhere.
- A company which was incorporated wherever and carries on a business or part of a business in Malaysia;
- A partnership under the Partnership Act 1961 or a limited liability partnership under the Limited Liability Partnerships Act 2012. This partnership carries on a business in Malaysia or elsewhere; or
- A partnership wherever formed and carries on a business in Malaysia or elsewhere.
The Interpretations Act 1948 and 1967 also defines the term “person” as bodies of persons, corporate or unincorporated. Therefore, a person who has been defined as “a person associated with the commercial organisation” includes both corporations and individuals.
Any members who are involved in public practice are also encouraged to develop the Guidelines on Adequate Procedures as their line of defence. This will provide the adequate proof they need to have in place, and ensure procedures are sufficient to prevent persons associated with them from undertaking corrupt practices relating to their business activities.
For more information about the Guidelines, please click here.
For more information about the Guide to implement, please click here.