Malaysia legislation

Section 2

of LABUAN FOUNDATIONS ACT 2010

Section 2

In this Act, unless the context otherwise requires—

“administrative penalty” means the penalty imposed in accordance with section 78;

“approved auditor” means a person approved by the Authority as an approved auditor under section 10 of the Labuan Companies

Act 1990 [Act 441];

Act 706

“articles” means the articles of a Labuan foundation provided for in section 10;

“Authority” means the Labuan Financial Services Authority established under section 3 of the Labuan Financial Services

Authority Act 1996 [Act 545];

“authorized officer” means any officer duly authorized by the

Authority under subsection 3(2);

“beneficiary” means a person designated as a beneficiary under the provisions of the constituent document of a Labuan foundation;

“certificate of registration” means the certificate of registration issued under section 15 upon the registration of a Labuan foundation;

“charter” means the charter of a Labuan foundation provided for in section 8;

“constituent document” means the charter and the articles, of a Labuan foundation;

“corporation” means any body corporate, formed or incorporated, or existing within or without Malaysia and includes any foreign

Labuan company but does not include—

(a)

any corporation sole;

(b)

any trade union registered under any written law as a trade union; and

(c)

any society registered under any written law relating to co-operative societies;

“council” and ”council member” mean the council of a Labuan foundation appointed in accordance with section 25 and council member shall be construed accordingly;

“Court” means the High Court or a judge of the High Court;

“founder” means the person who subscribes his name to the charter establishing a Labuan foundation acting either for himself or on behalf of another person and who, by transfer of title, endows that Labuan foundation with its initial assets;

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“initial assets” means the property endowed by the founder or founders, as the case may be, at the time of establishment of a

Labuan foundation and vested in and being the property of that

Labuan foundation;

“Labuan” means the Federal Territory of Labuan;

“Labuan company” has the meaning assigned to it in the Labuan

Companies Act 1990;

“Malaysia” means the territories of the Federation of Malaysia, the territorial waters of Malaysia and the sea-bed and subsoil of the territorial waters, and includes any area extending beyond the limits of the territorial waters of Malaysia, and the sea-bed and subsoil of any such area, which has been or may hereafter be designated under the laws of Malaysia and in accordance with international law as an area over which Malaysia has sovereign rights for the purposes of exploring and exploiting the natural resources, whether living or non living;

“Malaysian property” means any property which is situated in

Malaysia;

“Minister” means the Minister for the time being charged with the responsibility for finance;

“officer” means the officer of a Labuan foundation appointed in accordance with section 35;

“person” includes a corporation, a partnership, a body of persons, corporate or unincorporated, and a corporation sole;

“property” includes—

(a)

assets of every kind, whether corporeal or incorporeal, movable or immovable, tangible or intangible, however acquired; and

(b)

legal documents or instruments in any form, including electronic or digital, evidencing title to or interest in, such assets as described in paragraph (a), including bank cheques, money orders, shares, securities, bonds, bank drafts and letters of credit;

Act 706

“register” means the register of Labuan foundations registered under this Act maintained under section 16;

“remaining beneficiary” means a person or persons who, according to the constituent document of a Labuan foundation, shall be entitled to receive any remaining property after the dissolution of the Labuan foundation;

“resident” means any person—

(a)

who is a citizen or permanent resident of Malaysia; or

(b)

who has established a place of business and is operating in Malaysia, other than a Labuan company or a foreign

Labuan company incorporated or registered under the

Labuan Companies Act 1990, a Labuan foundation established under this Act, a partnership registered under the Labuan Limited Partnerships and Limited Liability

Partnerships Act 2010 [Act 707], and includes a person who is declared to be a resident pursuant to section 43 of the *Exchange Control Act 1953 [Act 17];

“secretary” means a Labuan Trust company appointed as secretary in accordance with section 41;

“supervisory person” means any person or body of persons having supervisory powers over the Labuan foundation and is appointed under the charter of the Labuan foundation;

“to endow” means to pass, or covenant to pass, the title in property, absolutely so as to transfer the title to the property effectively, with or without consideration, to a Labuan foundation so that the property is the property of that Labuan foundation.

*NOTE—The Exchange Control Act 1953 [Act 17] has since been repealed by the Financial

Services Act 2013 [Act 758] which comes into operation on 30 June 2013—see section 271 Act 758.

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