Malaysia amends winding-up threshold

28 April 2021

On 1 April 2021, the Prescription of Amount of Indebtedness of Company under paragraph 466(1)(a) (Gazette Notification No. 4159) (“Prescription Order”) came into effect.

The Prescription Order provides that the amount of indebtedness of a company for the purposes of the phrase “inability to pay debts” under section 466(1)(a) of the Malaysian Companies Act 2016 (“Threshold”) has been increased to an amount exceeding RM50,000. The Prescription Order remains in effect indefinitely.

The previous Prescription of Amount of Indebtedness of Company under paragraph 466(1)(a) (Gazette Notification No. 21841) amended the Threshold to an amount exceeding RM50,000 for a definite period running from 1 January 2021 to 31 March 2021 only. The previous Threshold of more than RM10,000 has been revoked with effect from 1 January 2021.