Malaysia legislation
Section 20
Section 20
The principal Act is amended by inserting after section 430
the following division:
“Division 9
Protection for Essential Goods and Services
Protection for essential goods and services 430a. (1) Subject to subsection (2), an insolvency related clause in any contract for the supply of essential goods and services shall not be exercised against any company.
(2)
A supplier who wishes to exercise his rights pursuant to an insolvency related clause in a contract shall communicate his intention of preserving his rights under the insolvency related clause to the company in writing at least thirty days before exercising his rights pursuant to the insolvency related clause in accordance with the contract.
(3)
This section shall not prevent a supplier from exercising his any other rights, including right to payment for essential goods and services provided to a company, under a contract for supply of essential goods and services.
Companies (Amendment)
(4)
For the purposes of this section—
(a)
“insolvency related clause” means a term of contract which—
(i)
allows the automatic termination of a contract of essential goods and services or supply of essential goods and services, modification of rights between a supplier and a company under the contract merely because the company becomes subject to the proceedings in relation to a compromise or arrangement, a voluntary arrangement or a judicial management; or
(ii)
allows a supplier to terminate a contract of essential goods and services or supply of essential goods and services, enforce any rights or vary any obligations under a contract merely because the company becomes subject to the proceedings in relation to a compromise or arrangement, a voluntary arrangement or a judicial management;
(b)
“essential goods and services” means essential goods and services specified in the Ninth a Schedule.”.
Amendment of section 433