Malaysia
Legislative and Regulatory Amendments
- Securities Commission Malaysia (SC)
Initiatives to Spur Innovation
The Securities Commission Malaysia (SC) announced that it will introduce a regulatory sandbox and enhance its framework to foster securities tokenisation and innovation in the capital market. Additionally, the SC will collaborate with Khazanah Nasional to explore tokenised bond issuance. These initiatives, announced at the SCxSC Fintech Summit 2024, aim to promote responsible innovation in the capital market.
Date of Release: 1 Oct 2024
Implementation on: Application is only until Apr 2025 for the first cohort of the sandbox
Applicable to: Capital Market
ESG Disclosure Assessment Report Sets Baseline for Reporting Practices
The SC and the World Bank launched a joint report entitled “ESG Disclosure Assessment of Malaysia’s Listed Companies and Recommendations for Policy Development” at the SC-World Bank Conference 2024. The report was based on an in-depth assessment, conducted between August and December 2023, examining ESG disclosure practices of a representative sample of 90 companies listed on Bursa Malaysia, as well as processes among some of Malaysia's largest asset owners. It offers key insights for companies and investors to enhance sustainability reporting to align with international best practices and remain competitive.
Date of Release: 15 Oct 2024
Implementation on: 15 Oct 2024
Applicable to: Listed Companies and Institutional Investors
MoU to Catalyse MTC Access to the Capital Market
The SC signed a Memorandum of Understanding (MoU) with Khazanah Nasional Berhad via Dana Impak Fund to increase access to funding and familiarise the capital markets for Malaysian mid-tier companies (MTC) to further catalyse their growth and expansion. Khazanah, through Dana Impak which is a key pillar under its Advancing Malaysia strategy, has earmarked an initial RM500 million to provide funding to MTCs. This funding will be directed to high-potential MTCs via the private markets, be it private equity or private credit funds, ensuring greater access to capital.
Date of Release: 17 Oct 2024
Implementation on: 17 Oct 2024
Applicable to: Mid-Tier Companies
National Sustainability Reporting Framework
The Advisory Committee on Sustainability Reporting (ACSR), chaired by the SC, issued a Public Response Paper in response to the feedback received pursuant to the Public Consultation Paper on the proposed National Sustainability Reporting Framework dated 15 February 2024.
Date of Release: 21 Oct 2024
Implementation on: Phased implementation starting with Group 1 in 2025, followed by Group 2 in 2026 and Group 3 in 2027
Applicable to: Listed Issuers and Non-listed Companies with annual revenue of RM 2 billion or more
SC and CGC Group Sign MoU to Boost MSME and MTC Access to Capital Market Financing
The SC signed a Memorandum of Understanding (MoU) with Credit Guarantee Corporation Malaysia Berhad (CGC Group) and CGC Digital Sdn. Bhd. The MoU focuses on enhancing Malaysian micro, small and medium enterprises (MSME) and mid-tier companies (MTC) access to capital market financing solutions. Key focuses of the collaboration include: (1) Enhancing MSME and MTC access to capital market financing solutions via CGC’s imSME platform; and (2) Supporting MSME and MTCs’ de-risking of investments by providing credit guarantees, and extending credit guarantees to additional capital market solutions.
Date of Release: 11 Dec 2024
Implementation on: 11 Dec 2024
Applicable to: MSME and MTC
Updated Iteration of the ASEAN Taxonomy for Sustainable Finance (ASEAN Taxonomy) Version 3
The ASEAN Taxonomy Board (ATB) released the updated iteration of the ASEAN Taxonomy for Sustainable Finance (ASEAN Taxonomy) Version 3, which includes technical screening criteria for the Construction & Real Estate and Transportation & Storage sectors. The ATB also developed a Frequently Asked Questions (FAQ) document to promote understanding and adoption of the ASEAN Taxonomy and a new SME Use Cases, covering the construction, agriculture, and manufacturing sectors, which serve as practical references to facilitate and encourage greater adoption and application of the Taxonomy by SMEs.
Date of Release: 20 Dec 2024
Implementation on: 20 Dec 2024
Applicable to: Sustainable Finance
- Bursa Malaysia
Bursa Malaysia announced the launch of e-Trade which aims to make stock market investing more accessible and user-friendly for all eWallet users. Through the platform, retail investors can directly access a broad spectrum of products offered by Bursa Malaysia, including stocks and exchange traded funds, providing a more rewarding and inclusive investment experience.
Date of Release: 1 Oct 2024
Implementation on: 1 Oct 2024
Applicable to: Capital Markets
Launch of the Secondary Market for Debt Fundraising and Investment Platform
Bursa Malaysia RAM Capital Sdn Bhd (“BR Capital”), a joint venture entity between Bursa Malaysia and RAM Holdings Berhad (“RAM”), announced the launch of a secondary market for its debt fundraising and investment platform. The secondary market allows investors to buy or sell investments, providing flexibility and liquidity after the initial issuance. It also contributes to better price discovery and optimisation of investment strategies.
Date of Release: 9 Dec 2024
Implementation on: 9 Dec 2024
Applicable to: Capital Market
Sustainability Reporting Using the IFRS Sustainability Disclosure Standards
Bursa Malaysia announced the enhancements to the Listing Requirements in the MAIN and ACE Market to align with the National Sustainability Reporting Framework (“NSRF”). The enhancements to the Listing Requirements seek to foster the use of the IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures (collectively, the “IFRS Sustainability Disclosure Standards”) as the baseline standards for sustainability reporting in Malaysia.
Date of Release: 23 Dec 2024
Implementation on: Phased implementation starting 2025, 2026 and 2027 depending on the levels of maturity among listed issuers.
Applicable to: Capital Markets
- Bank Negara Malaysia (BNM)
Policy Compliance in Cross-Border Transactions with Project Mandala
The BNM announced that regulatory compliance can be embedded in cross-border transaction protocols, as successfully demonstrated by Project Mandala. This experimental project is a collaboration between the BIS Innovation Hub Singapore Centre, the Reserve Bank of Australia, the Bank of Korea, Bank Negara Malaysia and the Monetary Authority of Singapore. The project aligns with the priority actions for achieving the G20 targets of promoting an efficient legal, regulatory and supervisory environment for cross-border payments while maintaining their safety, security and integrity.
Date of Release: 28 Oct 2024
Implementation on: 28 Oct 2024
Applicable to: Financial Institutions
Launch of InvestMalaysia Portal
The Government of Malaysia launched the InvestMalaysia portal as a one-stop platform, providing key information to help investors make informed and timely investment decisions. The portal aims to strengthen Malaysia’s position as a competitive and attractive investment destination by highlighting and promoting attractive investment opportunities in Malaysia’s financial markets to both domestic and foreign investors.
Date of Release: 7 Nov 2024
Implementation on: 7 Nov 2024
Applicable to: Capital Market
Foreign Exchange Policy Liberalisation for Multilateral Development Banks and Qualified Non-Resident Development Financial Institutions
The BNM announced the liberalisation of foreign exchange policy (FEP) for multilateral development banks (MDBs) and qualified non-resident development financial institutions (DFIs) which aims to facilitate their investment in key growth areas in Malaysia. This includes the electrical and electronics (E&E) industry, technology adoption, sustainability and data centres. The MDBs and qualified non-resident DFIs will now be able to issue ringgit-denominated debt securities for use in Malaysia and provide ringgit financing to resident entities.
Date of Release: 15 Nov 2024
Implementation on: 15 Nov 2024
Applicable to: MDBs and non-resident DFIs
Policy Document on Product Transparency and Disclosure
The BNM announced that it has updated the Policy Document on Product Transparency and Disclosure, introducing new and improved disclosure requirements to help consumers better select financial products that meet their needs.
Date of Release: 3 Dec 2024
Implementation on: As indicated in the document.
Applicable to: Financial Service Providers
Consultations
- Bursa Malaysia
Bursa Malaysia issued a consultation paper seeking public feedback on the proposed amendments to the Rules of Bursa Malaysia Depository Sdn. Bhd. These amendments aim to facilitate Bursa Malaysia’s move towards embracing further digitisation in the issuance of securities account statements to depositors, as part of its broader commitment toward environmental sustainability.
Consultation Period: 26 Dec 2024 – 14 Feb 2025
Applicable to: Depositors
- Bank Negara Malaysia (BNM)
Exposure Draft on Complaints Handling
The BNM issued an exposure draft on complaints handling, which sets out the proposed requirements and expectations aimed at ensuring that complaints handling mechanisms of financial service providers (FSPs) remain relevant, accessible and timely. These enhancements are necessary in view of the rapid digitalisation of business practices of FSPs, the increasing complexity of financial products and services and the heightened expectations of financial consumers for FSPs to be responsive, fair and effective in handling complaints.
Consultation Period: 8 Oct 2024 – 8 Nov 2024
Applicable to: Financial Service Providers
Exposure Draft on Risk Management in Technology
The BNM released an exposure draft outlining new requirements for financial institutions to manage technology risks, aiming to strengthen the resilience of financial services and improve system-wide cyber defence. The policy revision also aims to improve supervisory review process for emerging technologies to better facilitate digitalisation of the financial system.
Consultation Period: 7 Nov 2024 – 31 Jan 2025
Applicable to: Financial Institutions
Shariah Contract Framework Discussion Paper
The BNM published a Discussion Paper on the Shariah Contract Framework, proposing a review of current Shariah contract policies. The paper outlines a framework design, alignment with objectives, recalibration of Shariah and operational requirements, and a review timeline. This initiative aims to support the broader use of Shariah contracts by Islamic financial institutions, aligning with the Financial Sector Blueprint 2022-2026.
Consultation Period: 11 Nov 2024 – 10 Feb 2025
Applicable to: Islamic Financial Institutions
Exposure Draft on Technology Requirement for Payment Services Regulatees
The BNM issued an exposure draft outlining the new technology risk management requirements for payment services regulatees (PSRs). The draft aims to consolidate these requirements into a single policy document for approved electronic money issuers (EMI), registered merchant acquirers (MA), and licensed money services businesses (MSB).
Consultation Period: 17 Dec 2024 – 30 Apr 2025
Applicable to: Payment Service Regulatees
Exposure Draft on Prudent and Professional Conduct of Insurance and Takaful Brokers
The BNM issued an exposure draft on the Prudent and Professional Conduct of Insurance and Takaful Brokers, outlining regulatory requirements to ensure the responsible conduct of approved brokers. The proposed requirements will be incorporated into the final Policy Document and apply to approved brokers once finalised.
Consultation Period: 19 Dec 2024 – 5 Feb 2025
Applicable to: Brokers
This document is provided for information purposes only and does not constitute legal, tax, investment, regulatory, accounting or other professional advice. For more information on the legal and regulatory status of IQ-EQ companies please visit www.iqeq.com/legal-and-compliance.