Shearn Delamore & Co.
  October 4, 2020 - Malaysia

Shearn Delamore & Co. Legal Update September 2020 (Financial Services)

SME Merger and Acquisition instruments exempt from stamp duty

The Prime Minister announced that starting from 1 July 2020 until 30 June 2021, eligible SMEs will be exempted from paying stamp duty on instruments for Mergers & Acquisitions (“M&A instruments”), including Contracts or Agreements for sale or lease of properties (including land, building, machinery and equipment); Instrument of Transfer and Memorandum of Understanding; Loans or Financing Agreement; and First Tenancy Agreement.

To be eligible, SMEs must:

• Be 100% Malaysian owned; and

• have annual sales turnover of less than RM50 million or full-time employees of less than 200, as per the definition of SMEs in the manufacturing sector; or

• have annual sales turnover of less than RM20 million or full-time employees of less than 75, as per the definition of SMEs in the services sector.

Applicants must obtain the certification of SME Status and 100% Malaysian ownership status in order to verity the SME status.

The announcement as well as Procedures and Guidelines, and an FAQ can be found here https://tinyurl.com/yyclu9xv.

BNM issues FAQs and Guidances on AML/CFT and TFS

On 1 September 2020 Bank Negara Malaysia (“BNM”) issued FAQs and Guidances for both Financial Institutions (“FIs”) and Designated Non-Financial Businesses and Professions (“DNFBPs”) and Non-Bank Financial Institutions (“NBFIs”), with the purpose of providing further clarification on the requirements in the revised Anti-Money Laundering, Countering Financing of Terrorism and Targeted Financial Sanctions (“AML/CFT and TFS”) Policy Document that was issued on 31 December 2019 and came into force on 1 January 2020.

These include:

• Guidance on Verification of Individual Customers for Customer Due Diligence; and

• Guidance on Beneficial Ownership.

The full announcement and set of Guidances can be found here for FIs https://tinyurl.com/y3y7zkz5 and here for DNFBPs & NBFIs https://tinyurl.com/yyxf5kal.

For further information regarding financial services matters, please contact our Financial Services Practice Group.