THE STATUTORY DERIVATIVE ACTION IN MALAYSIA: FILLING IN THE GAPS

In 2007, the Companies Act (Amendment Act) was passed. It included a new provision introducing statutory derivative action that allows action to be brought on behalf of the company by certain ‘complainants’. This article highlights certain gaps in the law or the potential misconception that could arise in understanding the new statutory derivative action. Decisions from the UK and other comparable common law jurisdictions that have codified the statutory derivative action discussing the scope of the statutory derivate action will be examined to shed some light on the newly introduced section 181A of Malaysian Companies Act 1965 with the intention of ascertaining whether the principles in some of these decisions could be introduced into Malaysian company law jurisprudence.