Small business is undoubtedly the lifeblood of economies, more so where those economies are emerging and developing. The promotion and nurturing of entrepreneurship is a key factor in economic success, not just for those entrepreneurs, but for the wider society, which, as stakeholders, benefits from the generation and distribution of wealth through economic and social policy. One unresolved question, however, is how to treat MSMEs (micro-, small- and medium-enterprises) in insolvency.
Both the corporate voluntary arrangement and judicial management, together with the Companies (Corporate Rescue Mechanism) Rules 2018 (“Rules”), came into force earlier this year on 1 March 2018 with the gazetting of notice P.U. (B) 106/2018.
We have previously discussed the insolvency law policy and procedure, touching briefly on judicial management and corporate voluntary arrangement. We will now look at the rules applicable for the application for these two rescue mechanisms.
Corporate Voluntary Arrangement
NON-FISCAL POLICIES TO HELP BUSINESSES OUTLAST THE COVID-19 VIRUS
In the table below, we have summarised the key differences between the remedies available to distress company which is unable to pay monies to its creditors.
In part 2 of this 3-part series, Omni Bridgeway turns to Nathan Landis, an Investment Manager based in our Perth office, Shane Taylor, a Business Development Director based in our Sydney office,
Law of Undue Preference in Malaysia – Section 528(1) of the Malaysian Companies Act 2016 provides that:-
The Covid-19 outbreak has had a significant impact on Malaysian businesses in multifarious facets. The imposition of the Movement Control Order on 16 March 2020, restricted domestic and international travel, and prohibited the operation of non-essential businesses in order to curb the spread of the outbreak.
Corporate Rescue Mechanism for Companies in Distress: A Compromise Between Debtors and Creditors As an attempt to curb and contain the spread of the COVID-19 pandemic in the country, the Government of Malaysia implemented the Movement Control Order (“MCO”) which took effect from 18.03.2020. As at the date of this article, the Conditional MCO (“CMCO”) which was announced on 01.05.2020 is scheduled to end on 09.06.2020.
Janus was a pagan god worshipped by the ancient Romans before an event commenced or during transitional periods such as from war to peace. Commonly depicted with two faces pointing towards opposite directions, the two-faced god represents the past and future, opposing sides but also deceit. As this article shall explain below, the Covid-19 Act is an instrument meant to guide us on navigating this post-coronavirus age but regrettably, does not live up to all of its tales.
As business and commerce becomes increasingly cross-border in nature, it is important for businesses to have knowledge of restructuring and insolvency regimes of foreign jurisdictions. This is particularly relevant in the Southeast Asia region, given the close connection and links amongst the Southeast Asian states.