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Bursa Malaysia Berhad Public Consultation Papers: (A) Proposed Amendments To The Main And Ace Market Listing Requirements In The Areas Of Anti-Corruption And Whistle-Blowing Measures; And (B) Driving Digitalisation In Corporate Exercises

Bursa Malaysia Berhad (“Bursa Malaysia” or the “Exchange”) has, on 26 September 2019, issued a consultation paper seeking public feedback on the proposed amendments to the Main and ACE Market Listing Requirements (collectively “Listing Requirements”) in light of the government’s call under the National Anti-Corruption Plan (2019-2023). In that connection, Bursa Malaysia seeks the views and comments from the public in relation to the following two areas namely anti-corruption and whistle-blowing measures, as well as digitalisation of corporate exercises, which is explained in further detail below.

PART 1:    STRENGTHENING THE GOVERNANCE OF LISTED ISSUERS TO PREVENT CORRUPTION, MISCONDUCT AND FRAUD

The Malaysian government has taken a strict stance against combating corruption and this is evident with the introduction of Section 17A of the Malaysian Anti-Corruption Commission Act 2009 (“MACC Act”) which takes effect on 1 June 2020 and has far-reaching implications to directors and corporations.

In this regard, Bursa Malaysia proposes to mandate a listed issuer to ensure that its board of directors does the following in order to promote a better governance culture and ethical behaviour across all levels of the listed issuer which is necessary towards sustainability of the listed issuer’s business in the long term:

(i)    establish and maintain policies and procedures on anti-corruption that is guided by the Guidelines on Adequate Procedures (“GAP”) issued pursuant to Section 17A(5) of the MACC Act, or any other recognised framework which is similar to, or more stringent than the GAP (e.g. the Corporate Integrity System Malaysia or the ISO 37001 – anti-bribery management systems) and whistle-blowing;

(ii)   conduct annual review of such policies and procedures, and publish them on the listed issuer’s website; and

(iii)  include corruption risk in its annual risk assessment framework.

PART 2:    PROMOTING OPERATIONAL EFFICIENCY AND EFFICACY THROUGH DIGITISING CORPORATE EXERCISES

Currently, securities holders subscribe for their rights shares or excess rights shares, convert their convertible securities into shares, or elect to participate in a DRS, manually. This would generally entail the completion and signing of the hard copies of the relevant forms, preparing the requisite payment in the form of a banker’s draft, cashier order, money order or postal order and the submission of the completed forms and requisite payment to the listed issuer’s share registrar personally either by hand, post or courier.

With innovations and advancements in technology, Bursa Malaysia believes that it is timely to modernise the current manual method through digitisation of some steps and accordingly, Bursa Malaysia proposes to require listed issuers to offer an option (in addition to the manual method) for its securities holders to perform the (i) subscription and payment for rights issue; (ii) conversion and payment for convertible securities; and (iii) election to participate in a dividend reinvestment scheme, electronically, either by way of an internet-based facility made available to securities holders, the use of automated teller machines or any other electronic mode as may be prescribed by Bursa Malaysia (eCorporate Exercise).

Additionally, Bursa Malaysia proposes to require a listed issuer to include (a) procedures for electronic conversion, in the notice of conversion or exercise of convertible securities; and (b) procedures for completing the election notice to participate in a DRS electronically, in the statement accompanying the election notice in the relevant notice or statement.

The consultation paper and the proposed amendments in Annexures A and B are available for download at Bursa Malaysia’s website (http://www.bursamalaysia.com/market/regulation/rules/public-consultation). Interested parties are invited to submit their comments and feedback to Bursa Malaysia by 25 October 2019 in the template table of comments prepared by Bursa Malaysia, either via (i) Email: [email protected]; (ii) Facsimile: +603 2732 0065; or (iii) Mail: Regulatory Policy & Advisory, Bursa Malaysia Securities Berhad, 9th Floor Exchange Square, Bukit Kewangan, 50200 Kuala Lumpur.

If you have any queries arising from the above developments, please do not hesitate to get in touch with our team:

Ivan Ho Yue Chan

Partner

[email protected]

 

Karen Kaur

Partner

[email protected]

 

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