Section 2

in Part III and Schedule 5, the person who submits, on its own behalf or through an advocate, a secretarial firm or other duly authorized representative, the application for authorization under section 9;

in Part VI and schedule 6, the person who submits, on its own behalf or through an advocate, a secretarial firm or other duly authorized representative, the application for approval under that part; or

in Part VII, the person who submits the application to be a financial holding company or proposes another company to be a financial holding company;

“appointed actuary” means an actuary appointed by a licensed

Financial Services 25

insurer under subsection 74(1) or by the Bank under section 75;

“appointed date” in respect of any provision under this Act, means the date appointed by the Minister under subsection 1(2)

as the date for the coming into operation of that provision;

“approved business” means any business set out in Division 1 of

Part 1 of Schedule 1;

“approved financial adviser” means a person approved under section 11 to carry on financial advisory business;

“approved insurance broker” means a person approved under section 11 to carry on insurance broking business;

“approved issuer of a designated payment instrument” means a person approved under section 11 to issue a designated payment instrument;

“approved money-broker” means a person approved under section 11 to carry on money-broking business;

“approved operator of a payment system” means a person approved under section 11 to operate a payment system set out in paragraph 1 of Division 1 of Part 1 of Schedule 1;

“approved person” means a person approved under section 11

to carry on an approved business;

“approved representative office” means a representative office in Malaysia of a foreign institution approved by the Bank under subsection 19(4);

“arrangement” means an arrangement whether formal or informal, oral or written, express or implied;

“associate corporation” means a corporation in which not less than twenty per cent but not more than fifty per cent of the voting shares of that corporation are held by another corporation, where

26 Laws of Malaysia the first-mentioned corporation is an associate corporation of the other corporation;

“authorization” means the grant of a licence under section 10 or the grant of an approval under section 11;

“authorized business” means a licensed business or an approved business;

“authorized person” means a person licensed under section 10 or approved under section 11 to carry on an authorized business;

“Bank” has the same meaning as defined in subsection 2(1) of the

Central Bank of Malaysia Act 2009 [Act 701];

“banking business” means—

the business of—

accepting deposits on current account, deposit account, savings account or other similar account;

such other business as prescribed under section 3;

“books” has the same meaning assigned to it in subsection 4(1) of the *Companies Act 1965 [Act 125];

“bridge institution” means a body corporate established or acquired by the Bank, and designated as a bridge institution under subsection 176(1);

*NOTE― The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

Financial Services 27

“business transfer scheme” means a scheme of transfer for banking business, investment banking business or insurance business;

“chief executive officer”, in relation to—

a body corporate or unincorporate, means an individual, however styled, who, either individually or jointly with one or more other persons, is responsible under the authority of the directors, for the conduct of the business and the administration of such body; or

an authorized person which is established as a branch in

Malaysia, means an officer principally responsible for the business of the branch in Malaysia;

“child” includes an illegitimate child, a step-child and a child adopted under any written law of Malaysia or of any place outside

Malaysia, or under a custom recognized by a class, category or description of persons in or outside Malaysia;

“company” has the same meaning assigned to it in subsection 4(1)

of the *Companies Act 1965;

“computer” has the same meaning assigned to it in section 3

of the Evidence Act 1950 [Act 56];

“computer output” means a statement or representation, whether in written, printed, pictorial, film, graphical, acoustic or other form—

produced by a computer;

displayed on the screen of a computer; or

accurately translated from a statement or representation so produced;

*NOTE― The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

28 Laws of Malaysia

“constituent document” has the same meaning assigned to it in subsection 2(1) of the Central Bank of Malaysia Act 2009;

“corporate group” means a group of corporations which are related to each other;

“corporation” has the same meaning assigned to it in subsection 4(1)

of the *Companies Act 1965;

“co-operative society” has the same meaning assigned to it in section 2 of the Co-operative Societies Act 1993 [Act 502];

“credit facility” means—

the giving of any advance, loan or other facility in whatever form or by whatever name called;

the giving of a guarantee; or

any other dealing or transaction as prescribed under section 4;

“deposit” means a sum of money accepted or paid on terms under which it will be repaid in full, with or without interest or any other consideration in money or money’s worth, either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person accepting it, but excludes money paid bona fide—

by way of an advance or a part payment under a contract for the sale, hire or other provision of property or services, and is repayable only in the event that the property or services are not in fact sold, hired or otherwise provided;

*NOTE― The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

Financial Services 29

by way of security for the performance of a contract or by way of security in respect of any loss which may result from the non-performance of a contract;

without limiting paragraph (b), by way of security for the delivery up or return of any property, whether in a particular state of repair or otherwise; and

in such other circumstances, or to or by such other person, as set out in schedule 2;

“depositor” means a person entitled to the repayment of a deposit, whether the deposit was made by him or any other person;

“derivative” means any agreement, including an option, a swap, futures or forward contract, whose market price, value, delivery or payment obligations is derived from, referenced toor based on, but not limited to, securities, commodities, assets, rates (including interest rates or exchange rates) or indices;

“designated payment instrument” means a payment instrument prescribed as a designated payment instrument under section 31;

“designated payment system” means a payment system prescribed as a designated payment system under subsection 30(1);

“director” includes any person who occupies the position of a director, however styled, of a body corporate or unincorporate, and includes—

a person in accordance with whose directions or instructions the directors or officers of the body are accustomed to act;

an alternate or substitute director; or

in particular, without limiting the foregoing, in the case of—

30 Laws of Malaysia

a corporation, has the same meaning assigned to it in subsection 4(1) of the *Companies Act 1965;

a sole proprietorship, means the sole proprietor; and

stores funds electronically in exchange of funds paid to the issuer; and

is able to be used as a means of making payment to any person other than the issuer;

“electronic terminal” means an electronic device, operated by or on behalf of an authorized person or a registered person, through which a person may initiate an electronic fund transfer, and includes a

*NOTE―The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

Financial Services 31

point-of-sale terminal, automated teller machine or cash or cheque deposit machine;

“factoring business” means—

the business of acquiring debts due to any person; and

such other business as prescribed under section 3;

“financial adviser’s representative” means an individual, however styled, in the direct employment of, acting for or by arrangement with an approved financial adviser, who performs for the financial adviser any services relating to financial advisory business;

“financial advisory business” means any of the following:

analyzing the financial planning needs of a person relating to an insurance product;

recommending an appropriate insurance product to a person;

sourcing an insurance product from a licensed insurer for a person;

arranging of a contract in respect of an insurance product for a person; or

such other business, service or activity in relation to a financial service as prescribed under section 3;

“financial group” means a financial holding company and a group of related corporations under such financial holding company primarily engaged in financial services or in other services in connection with or for the purposes of such financial services which includes at least one licensed person;

“financial holding company” means a company which—

32 Laws of Malaysia

holds an aggregate of more than fifty per cent of interest in shares of a licensed person, or has an aggregate interest in shares of fifty per cent or less but has control over a licensed person; and

has obtained the approval of the Bank pursuant to subsection 112(3) to be a financial holding company of such licensed person;

“financial year” has the same meaning assigned to it in subsection 4(1) of the *Companies Act 1965;

“foreign company” has the same meaning assigned to it in subsection 4(1) of the *Companies Act 1965;

“foreign currency” means any currency other than ringgit;

“foreign institution” means a foreign company, not being an authorized person or a registered person, which carries on any business outside Malaysia which corresponds, or is similar, to the business of any authorized person or registered person, whether or not such person has an approved representative office;

“foreign insurer” means an insurer incorporated outside Malaysia;

“Governor” and “Deputy Governor” have the same meaning assigned to them in subsection 2(1)

of the central

Bank of Malaysia Act 2009;

“holding company” has the same meaning assigned to it in section 5 of the *Companies Act 1965;

“individual” means a natural person;

“insurance” includes reinsurance;

*NOTE― The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

Financial Services 33

“insurance agent” means a person who does all or any of the following:

solicits or obtains a proposal for insurance on behalf of an insurer;

offers or assumes to act on behalf of an insurer in negotiating a policy; or

does any other act on behalf of an insurer in relation to the issuance, renewal or continuance of a policy;

“insurance broker” means a person who, as an independent contractor, carries on insurance broking business and includes a reinsurance broker;

“insurance broking business” means the business of soliciting, negotiating or procuring a policy with an insurer, or the renewal or continuance of the policy by a person, for a policy owner other than for himself and includes reinsurance broking for an insurer;

“insurance claim” means a demand for payment of an amount due under a policy;

“insurance fund” means an insurance fund established and maintained under section 81;

“insurer” includes a professional reinsurer;

“interest in shares” shall be construed as set out in Schedule 3;

“investment account” has the same meaning assigned to it in subsection 2(1) of the Islamic Financial Services Act 2013 [Act 759];

“investment banking business” means—

the business of—

34 Laws of Malaysia

accepting deposits on deposit account; and

any regulated activity carried on pursuant to a

Capital

Markets

Services

Licence under the

Capital Markets and Services Act 2007 [Act 671]; and

such other business as prescribed under section 3;

“investment company” has the same meaning assigned to it in subsection 319(1) of the *Companies Act 1965;

“investment-linked policy” means a contract of insurance on human life or an annuity where the benefits are, wholly or partly, to be determined by reference to units, the value of which is related to—

the income from property of any description; or

the market value of such property;

“issuer” means any person, acting alone or under an arrangement with another person, who undertakes to be responsible for the payment obligation in respect of a payment instrument resulting from a user being issued with or using the payment instrument;

“leasing business” means—

the business of letting or sub-letting movable property on hire for the purpose of the use of such property by the hirer or any other person in any business, trade, profession or occupation or in any commercial, industrial, agricultural or other economic enterprise whatsoever and, where the lessor is the owner of the property, regardless whether the letting is with or without an option to purchase the property, but excludes the business of hire-purchase which is subject to the

*NOTE― The Companies Act 1965 [Act 125] has been repealed by the Companies Act 2016 [Act 777]

which comes into operation on 31 January 2017―see subsection 620(1) of Act 777.

Financial Services 35

Hire-Purchase Act 1967 [Act 212] and for the purpose of this definition,

“movable property”

includes any plant, machinery, equipment or other chattel attached or to be attached to the earth or fastened or to be fastened, permanently or otherwise, to any thing attached to the earth;

and

such other business as prescribed under section 3;

“liabilities” includes debts or obligations of every kind, whether present or future, or whether vested or contingent;

“licence” means a licence granted under section 10;

“licensed bank” means a person licensed under section 10 to carry on banking business;

“licensed business” means banking business, insurance business or investment banking business;

“licensed insurer” means a person licensed under section 10

to carry on insurance business;

“licensed investment bank” means a person licensed under section 10 to carry on investment banking business;

“licensed person” means a person licensed under section 10 to carry on a licensed business;

“life business” means the business of undertaking liability under a life policy;

“life policy” means a policy by which payment of policy moneys is insured on death or survival, including extensions of cover for personal accident, disease or sickness and includes an annuity but excludes a personal accident policy;

36 Laws of Malaysia

“Malaysia Deposit Insurance Corporation” means the Malaysia

Deposit Insurance Corporation referred to in the Malaysia Deposit

Insurance Corporation Act 2011 [Act 720];

“Malaysian policy” means a policy which is issued in Malaysia by a licensed insurer and is—

a life policy where the policy owner’s address, as specified in the policy or any other address subsequently notified in writing by the policy owner to the insurer, is or was an address in Malaysia;

a general policy which relates to risks arising in Malaysia, or where the policy owner is a resident of, or a permanent establishment in, Malaysia within the meaning of the

Income Tax Act 1967 [Act 53]; or

a reinsurance contract with another licensed insurer;

“market participant” means any person who—

issues, sells, purchases, repurchases, borrows, lends or otherwise deals with currencies or other financial instruments traded in the money market or foreign exchange market including over-the-counter derivatives whose price, value or payment obligations are derived from, referenced to or based on interest rates or exchange rates; or

arranges transactions in the money market or foreign exchange market as an intermediary, whether acting as a principal or an agent, and includes any other persons as prescribed under section 4;

“member”, in relation to a body corporate or unincorporate which is—

a corporation, means a shareholder;

Financial Services 37

a co-operative society, means a member of the co-operative society;

a partnership, means a partner;

any other body corporate having a membership, means a member of the body; and

a society registered under the Societies Act 1966 [Act 335], means a member of the society;

“merchant acquiring services” means a business of an operator of a payment system that enters into a contract with a merchant for the purpose of accepting payment instruments for payment of goods or services;

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

“money-broking business” means the business of arranging transactions between buyers and sellers in the money market or foreign exchange market as an intermediary in consideration of brokerage fees paid or to be paid, but excludes the buying or selling of Malaysian currency or foreign currencies as a principal in such markets;

“office” refers to a place where or at which any business of any person is carried out, including the head office in Malaysia, or any other office, a branch, an agency (except for an insurance agency in the case of a licensed insurer), a mobile place of business, a place of business set up and maintained for a limited period only or an electronic terminal;

“officer”, in relation to a body corporate or unincorporate, includes any employee or the chief executive officer of the body corporate or unincorporate;

“operator” means any person, acting alone or under an arrangement with another person, responsible for the rules, procedures and operations of a payment system;

38 Laws of Malaysia

“operator of a designated payment system” means any person who operates a designated payment system;

“participant” means any person who is permitted by the rules governing a payment system to send payment instructions or settlement instructions to the payment system and who is bound by the rules governing the payment system;

“participating life policy” means a life policy conferring a right to the policy owner to participate in allocations, of which the amount or timing is at the discretion of the insurer, from the assets of an insurance fund under subsection 81(2);

“payment instruction” or “settlement instruction”, in relation to a payment system, includes an instruction to transfer, clear or settle transactions in funds or securities, as the case may be;

“payment instrument” means any instrument, whether tangible or intangible, that enables a person to obtain money, goods or services or to make any payment;

“payment system” means any system or arrangement for the transfer, clearing or settlement of funds or securities;

“person” includes an individual, any corporation, statutory body, local authority, society, trade union, co-operative society, partnership and any other body, organization, association or group of persons, whether corporate or unincorporate;

“personal accident policy” means a policy providing fixed pecuniary benefits or benefits in the nature of indemnity, or both, against risks of the person insured sustaining injury or dying as the result of an accident or becoming incapacitated in consequence of disease;

“policy” means an insurance policy and includes a cover note or a contract of insurance, whether or not embodied in or evidenced by an instrument in the form of an insurance policy, and references to—

Financial Services 39

issuing a policy shall be construed as entering into a contract of insurance, whether or not a formal contract has been issued; and

a policy of an insurer includes a policy or a bond in respect of which the insurer is under any liability, whether the policy was issued by the insurer or the liability was transferred to the insurer from another insurer;

“policy moneys” includes any benefit, whether pecuniary or not, which is secured by a policy;

“policy owner” means the person who has legal title to a policy and includes—

where a policy has been assigned, the assignee;

where a personal representative of a deceased policy owner is entitled as against the insurer to the benefit of a policy, the personal representative;

in relation to a policy providing for the payment of annuity, an annuitant; and

where under a policy, moneys are due or payable, whether periodically or otherwise, the person to whom the moneys are due or payable;

“premises” includes any land, building, structure or place;

“premium” means the amount payable to an insurer under a policy as consideration for the obligations assumed by the insurer;

“prescribe” means to prescribe by an order published in the Gazette, and a power to prescribe includes the power to prescribe differently for different persons, payment systems or payment instruments or different classes, categories or descriptions of persons, payment systems or payment instruments;

40 Laws of Malaysia

“professional reinsurer” means a reinsurer which is licensed to carry on solely reinsurance business;

“property” means any movable or immovable property, whether tangible or intangible and includes—

any right, interest, title, claim, chose in action, power or privilege, whether present or future, or whether vested or contingent, in relation to any property, or which is otherwise of value;

any conveyance executed for conveying, assigning, appointing, surrendering, or otherwise transferring or disposing of immovable property of which the person executing the conveyance is the proprietor or has possession or in which he is entitled to a contingent right, either for the whole interest or for any less interest;

any security, including any stock, share, debenture and fund;

any negotiable instrument, including any bank note, bearer note, Treasury bill, dividend warrant, bill of exchange, promissory note, cheque and negotiable certificate of deposit; or

any mortgage or charge, whether legal or equitable, guarantee, lien or pledge, whether actual or constructive, letter of hypothecation, trust receipt, indemnity, undertaking or other means of securing payment or discharge of a debt or liability, whether present or future, or whether vested or contingent;

“provision of finance” includes—

lending of money;

leasing business;

factoring business;

Financial Services 41

purchase of bills of exchange, promissory notes, certificates of deposit, debentures or other negotiable instruments; and

the acceptance or guarantee of any liability, obligation or duty of any person;

“public company” has the same meaning assigned to it in subsection 4(1) of the *Companies Act 1965;

“registered adjuster” means a registered person carrying on adjusting business;

“registered business” means any business set out in Part 2 of