Malaysia's First Equity Crowdfunding Laws Require Licensed Trustee Services

Author:Ms Celine Chan
Profession:TMF Group
 
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Businesses that intend to use equity crowdfunding (ECF) to raise capital in Malaysia are now required to appoint a licensed trustee to hold and administer the funds during the crowdfunding offer period. Celine Chan, Managing Director of the Malaysia office, discusses the business advantages of the new ECF legislation and its impact.  

To keep pace with the growing investor market, Malaysia is the first country in the Asia Pacific region to legislate equity crowdfunding (ECF), standardising activities and translating innovation into wealth.

In July this year, the Capital Markets and Services Bill 2015 was passed; regulating the ECF framework and promoting private financing for research and development, commercialisation and innovation (R&D&C&I).

Ranjit Ajit Singh, Chairman of Securities Commission of Malaysia (SC) and Malaysian Venture Capital Development Council, said at the Synergy and Crowdfunding Forum 2015 (SCxSC) in June, that the ECF framework is an important milestone for inclusivity in the Malaysian capital market. 

He said, "the establishment of the ECF is a component of the SC's strategy to democratise finance. Over the years, Malaysia has developed a diversified and well established MYR2.8 trillion capital market, helping businesses to grow as well as financing long-term investments in the economy."

Global connectivity within the digital space has broken down the geographical limits for Malaysian entrepreneurs who seek venture...

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