Aligned with the strategy and support for the reform agenda to strengthen government governance and the corporate sector ecosystem, the Companies Commission of Malaysia (SSM), has begun phased enforcement of the Limited Liability Partnerships (Amendment) Act 2024 effective from 31 January 2025.
The Act will be enforced in stages starting from 31/01/2025, by the SSM. It will be carried out in 3 phases. What will be the Key Changes with the Amendment Act 2024?
Key Changes:
Beneficial Ownership: The Act sets out new requirements for reporting and disclosing information about the beneficial owners of Limited Liability Partnerships (LLPs). According to Sections 2, 3, 4, 5, Sub-Section 11(a), and Section 13, LLPs are required to identify and record their true owners.
Corporate Rescue Mechanisms: New frameworks and provisions related to procedures to support the implementation of sustainable LLP governance under Sections 8, 9, 10 and Sub-Section 11 (b).
Sustainable Governance: The amendment strengthens procedures to ensure better governance and sustainability within LLPs as stated in Sections 6, 7, and 12.
3 Phases Implementation: Phase 1 – Following the implementation of the Limited Liability Partnerships (Amendment) Act 2024, all LLPs are granted a 3-month grace period from 01 February 2025 to 30 April 2025 to identify their beneficial owners and record the beneficiary ownership details at the LLP's registered office. From 01 May 2025 to 31 October 2025, LLPs must submit the beneficial ownership information to SSM. During this period, SSM will waive any late fees and correction charges, and no enforcement action will be taken. Phase 2 – Aim to establish procedures that support sustainable LLP governance, with implementation expected by 31 March 2025. Phase 3 - It involves provisions related to the corporate rescue mechanism, which is expected to be enforced by 31 December 2025 The implementation of the Limited Liability Partnerships (Amendment) Act 2024 aims to reduce liability for partners in traditional partnerships, while also enhancing transparency, governance, and support for businesses, and minimizing risks and liabilities for LLPs partners.
LLPs are required to identify and obtain information on beneficial owners, and if an individual is aware that they are a beneficial owner, they have the obligation to inform the LLP, and vice versa.
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