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FORMS OF BUSINESS
ENTITIES AND BUSINESS
SUPPORT SYSTEM
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Session ObjectivesAt the end of the session, students should
be able to:
understand various forms of
business oranisations in !ala"sia
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LEGAL FORMS OF BUSINESSES IN MALAYSIA
Registration of Business Entities:
1$ %usiness Reistration Act 1&'( )Amendment
1&*+ * -rocedures Of %usiness Reistration 1&'*
2$ .om#an" Act 1&('
3$ .oo#erative Act 1&/+
/$ -arliamentar" Act or State )overnment Enactment
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.ommon forms of business structure:
Sole #ro#rietorshi# or sole trader
-artnershi#
imited com#an"3 !AOR .ARA.TER4ST4.S:
1$ 56!%ER O7 O85ER)S
2$ 4A%44T4ES O7 O85ER)S3$ 47E S-A5 O7 TE %6S45ESS 9 .O!-A5
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Sole ProprietorshipSole !ra"er
Solel" o;ned b" one #erson
!anaement rests on that #erson
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Partnership
-artners 9 O;ners : !in 2 and !a
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-artnershi#s are overned b" the -artnershi# Act
1&(1$ 4f the #artners do not ma=e their o;nareement, the #rovisions of the Act ;ill become
a##licable, such as:
#rofits > losses are to be shared e?uall"
no interest is #a"able on #artners@ ca#ital
ever" #artner is entitled to #artici#ate in the manaement
of the business
no #artner is entitled to a salar" for #artici#atin in the
#artnershi# business
e
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Li#ite" $o#pan%
A limited com#an" is incor#orated under the
.om#anies Act 1&('$ 4t can be:
A com#an" limited b" shares -rivate limited com#an" )Sdn %hd
-ublic limited com#an"
7orein o;ned com#an"
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$o#pan% Li#ite" B% Share
The liabilit" of a member@s contribution to
the com#an"@s assets is limited to the amount
s#ecified, if an", un#aid on his share$ The
#ersonal assets of a shareholder ;ould not
be available to the creditors of the com#an"$
T;o t es of com anies limited bu share:
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Pri&ate Li#ite" 'o#pan% (S"n) Bh")*
1$Restricts the riht to transfer its share
2$imits the number of its members 9
shareholders bet;een 2 to '03$-rohibits an" invitation to the #ublic to
subscribe for an" shares in the
com#an"/$-rohibits an" invitation to the #ublic to
de#osit mone" ;ith the com#an"
for fi
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Pu+li' Li#ite" 'o#pan% (Bh")*
A #ublic limited com#an" is an"
com#an" other than a #rivate com#an";hose shares ma" be offered to the
#ublic for subscri#tion$ Such shares are
freel" transferable$
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A,-AN!AGES AN,
,ISA,-AN!AGES OF EA$.BUSINESS FORM
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Sole ProprietorSole !ra"er
Advantages
1$ Eas" to set u# fe; formalities2$ Eas" to manae the o;ner is the boss
3$ The o;ner =ee#s the #rofits
/$ The o;ner is not re?uired to disclose
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Sole ProprietorSole !ra"er
Disadvantages1$ The o;ner is totall" res#onsible for
an" debts incurred b" the business if
the business fails or oes ban=ru#t,
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Partnership
Advantages1$ Eas" to set u# fe; formalities
2$ The o;ners are not re?uired to disclose
business affairs to the eneral #ublic
3$ .ontributions to ca#ital can be increased
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Partnership
Disadvantages
1$ Each #artner is liable for the debts of
the business reardless of ;hich #artner
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Li#ite" $o#pan%
Advantages
Shareholders are not liable for the
com#an"@s debts be"ond the amount of
share ca#ital the" have subscribed
Easier to transfer o;nershi#, either ;holl"
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Li#ite" $o#pan%
Disadvantages
1$ The #ublic ;ill have access to the financial
affairs of the com#an"2$ The com#an" has to com#l" ;ith the
re?uirements of the .om#anies Act 1&('
3$ The com#an" has to a##oint auditors to verif"
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.O/ !O REGIS!ER NE/
BUSINESSES$OMPANIES
All forms of sole traders and #artnershi#s are re?uired under the
Reistration Of %usiness Act 1&'(
to be reistered ;ith the Reistrar of
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Sole Proprietorship
%efore reisterin a business, com#lete a name
search form to ensure that there is no du#lication
4f the name is a##roved, #roceed to thefollo;in ste#s:
Step 1 : O+tain for# 0A0 fro# ROB Step 2: $o#plete For# 0A0
Step 3: .a&e it &erifie" +% $o##issioner for Oaths
Step 4: Su+#it For# 0A0 1ith a photo2'op% of %our i'
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Me#oran"u# an" Arti'les ofAsso'iation
The affairs of a limited com#an" areoverned b" these documents$ These
are usuall" combined into one
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Me#oran"u# of Asso'iation
This document defines the essential com#onents
of the structure of the com#an"$ 4t contains: the name of the com#an"
the situation of the reistered office
the objects of the com#an"
that the liabilit of members is ltd$
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Arti'les of Asso'iation
This document constitutes the internal reulations of
a com#an"$ 4t contains:
the name of the com#an"
the name of directors
the minimum and ma
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Pro'e"ures an" Legal Aspe'ts
Li'ense3 Per#it an" Letter of Authorit%
icense
%usiness icense
8holesalin icense
!anufacturin icense
7ood !anufacturin icense Sales Ta< icense E
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Pro'e"ures an" Legal Aspe'ts
-ermits
7orein 8or=ers’ Entr" -ermit
Trans#ortation -ermit
etter Of Authorit"
.ertificate of 7itness
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Other Pro'e"ures !o Be $onsi"ere"
Assemblin of !achiner" and E?ui#ment -ollution .ontrol
%usiness Rihts Trade !ar= -rotection
-atent -rotection .o#"riht
Standards and Cualit"
ire -urchase Act
8or=ers’ Social 5eeds 4nfrastructure 5eeds
4m#ort and E
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BUSINESS SUPPOR! SYS!EM
!he Entrepreneur
!e'hni'al
Assistan'eMar4eting
Assistan'e
Finan'ial
Assistan'e
Business
Infor#ation
Ser&i'esBusiness
Resear'hE5tension
Ser&i'es
$onsultan'%6 A"&isor%
Ser&i'es
Infra2stru'ture
!raining3
Se#inar 6
/or4shop
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Technical AssistanceSIRIM3 MARA3 MAR,I3 RRI3 PORIM
Marketing AssistanceMI!I3 MA!RA,E3 FAMA3 NR$
,IS!RIBU!ORS3 GU!.RIE3 BES!A
Infrastructure
MARA3 P7EN3 SIRIM3 U,A3 7PLB3 BPIMB3MI,A
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Information Services
MA!RA,E3 MI!I3 MAR,I3 SIRIM3 MI,A3FRIM3 uni&ersities
Business esearchMAR,I3 SIRIM3 uni&ersities
!inancial Assistance 'o##er'ial +an4s3 #er'hant +an4s3
in"ustrial +an43 finan'ial institution3
go&ern#ent agen'ies
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"onsultanc# $ Advisor# Services
ME,E$3 MARA
Training% Seminar and &orkshop
ME,E$3 PUNB3 MARA3 F,PN3 SE,$
'(tension ServicesME,E$3 MI!I3 SIRIM3 MARA3
MA!RA,E3 MAR,I3 NP$