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AdministeredLegislation>FinancialServicesAct2013
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AdministeredLegislation
Guidelines&Circulars
LawHarmonisationCommittee

EMAIL

FinancialServicesAct2013

LAWSOFMALAYSIA
Act758

FinancialServicesAct2013

DateofRoyalAssent

Dateofpublicationinthe
Gazette

18Mar2013

22Mar2013

AnActtoprovidefortheregulationandsupervisionoffinancialinstitutions,
paymentsystemsandotherrelevantentitiesandtheoversightofthemoneymarket
andforeignexchangemarkettopromotefinancialstabilityandforrelated,
consequentialorincidentalmatters.

[30Jun2013,

PU(B)276/2013.

excepts.129andSchedule9w.e.f.1Jan2015]

PU(B)552/2014.

ARRANGEMENTOFSECTIONS

PARTI

PRELIMINARY
1. Shorttitleandcommencement

2. Interpretation

3. PrescriptionbyMinisterofadditionalbusinessoractivity

4. PrescriptionbyBankofadditionalagreement,dealing,transactionorperson

5. Classificationof,andconstructionofreferencesto,insurancebusiness

PARTII

REGULATORYOBJECTIVESANDPOWERSANDFUNCTIONSOF
BANK
6. Regulatoryobjectives

7. PowersandfunctionsofBank

PARTIII

AUTHORIZATIONANDREGISTRATION

Division1

Authorizedbusiness
8. Authorizedbusinesstobecarriedonbyauthorizedperson

9. Applicationforauthorization

10. GrantoflicencebyMinister

11. ApprovalbyBank

12. Requirementsonminimumcapitalfundsorsurplusofassetsoverliabilities

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13. Additionalconditionsoflicenceorapproval

Division2

Restrictionondealingsofauthorizedpersons
14. Authorizedpersontocarryonauthorizedbusinessonly

15. Authorizedpersonandoperatorofdesignatedpaymentsystempermittedtocarry
oncertainIslamicfinancialbusiness

16. Licensedinsurertocarryonlifeorgeneralbusiness

Division3

Registeredbusiness
17. Registeredbusinesstobecarriedonbyregisteredperson

18. Registeredpersontocomplywithstandards

Division4

Representativeoffice
19. Requirementsforrepresentativeoffice

Division5

Revocation,deregistration,surrenderorcessationofbusinessoroperations
20. Groundsforrevocationofauthorization

21. Groundsforderegistration

22. Surrenderoflicenceornotificationoncessationofbusinessoroperations

23. Effectofrevocation,deregistration,surrender,notificationoncessationofbusiness
oroperations,andexpiry

Division6

Generalmatters
24. Formofestablishment

25. Establishmentorrelocationofofficeofauthorizedpersons

26. Fees

27. Publicationofnamesofauthorizedpersonsandregisteredpersons

28. Holdingoutasauthorizedpersonorregisteredperson

29. Actingonbehalfofunlicensedperson

PARTIV

PAYMENTSYSTEMS

Division1

Designationofpaymentsystemsandpaymentinstruments
30. Designationandrevocationofdesignationofpaymentsystems

31. Designationofpaymentinstruments

Division2

Requirementsforoperationofpaymentsystemsandissuanceofdesignated
paymentinstruments
32. ApplicationofthisActonpaymentsystems

33. PowerofBanktospecifystandardsforpaymentsystems

34. Directiontoparticipantsofdesignatedpaymentsystem

35. Operationalarrangements

36. PowerofBanktoinspect

Division3

Finalityofpaymentandnettingarrangement
37. Interpretation

38. PowerofBanktoissuecertificateoffinality

39. Revocationofcertificateoffinality

40. ApplicationofthisDivision

41. Transferordermadeafterappointmentofinsolvencyadministrator

42. Finalityofpaymentandnettingarrangement

43. Preservationofrights

44. Nonrecognitionofinsolvencyorderbyforeigncourt

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45. Requirementtonotifyineventofinsolvency,etc.

PARTV

PRUDENTIALREQUIREMENTS

46. Interpretation

Division1

Standardsonprudentialmatters
47. PowerofBanktospecifystandardsonprudentialmatters

48. Institution,directorandofficertocomplywithstandards

49. Registeredoperatorofpaymentsystemtocomplywithstandards

50. Singlecounterpartyexposurelimitforlicensedperson

51. Restrictiononpaymentofdividendbylicensedperson

52. MaintenanceofassetsinMalaysiabylicensedperson

Division2

Corporategovernance
53. Interpretation

54. Chairman,directorsandchiefexecutiveofficerofinstitution

55. Requirementstobechairman,director,chiefexecutiveofficerorseniorofficer

56. Functionsanddutiesofboardofdirectors

57. Dutiesofdirectors

58. Dutytodiscloseinterestsinmaterialtransactionormaterialarrangement

59. Disqualifications

60. Fitandproperrequirements

61. Cessationfromoffice

62. Noticeofcessationfromoffice

Division3

Transparencyrequirements
63. Interpretation

64. Maintenanceofaccountingrecordsandinformation

65. Compliancewithapprovedaccountingstandards

66. Publicationoffinancialstatements

Division4

Auditors
67. Appointmentofauditorbyinstitution

68. AppointmentofauditorbyBank

69. Dutiesofauditor

70. Noticeofcessationasauditor

71. Informationtobeprovidedtoauditor

72. Reportingobligationsofauditor

73. Qualifiedprivilegeanddutyofconfidentiality

Division5

Appointedactuaries
74. Appointmentofactuarybylicensedinsurer

75. AppointmentofactuarybyBank

76. Dutiesofappointedactuary

77. Cessationasappointedactuary

78. Noticeofcessationasappointedactuary

79. Informationtobeprovidedtoappointedactuary

80. Qualifiedprivilegeanddutyofconfidentiality

Division6

Insurancefunds
81. Establishmentandmaintenanceofinsurancefunds

82. Requirementsrelatingtoinsurancefunds

83. Withdrawalfrominsurancefunds

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84. Assumptionofrisk

Division7

Subsidiaries
85. Establishmentoracquisitionofsubsidiariesandacquisitionorholdingofmaterial
interestincorporation

PARTVI

OWNERSHIP,CONTROLANDTRANSFEROFBUSINESS

86. Applicationandnonapplication

Division1

Interestinsharesoflicensedperson
87. Acquisitionofinterestinsharesrequiringapproval

88. Controloverlicensedpersonprohibitedinsomecases

89. Disposalofinterestinsharesrequiringapproval

90. Applicationproceduresforsection87,88or89

91. PowerofBanktospecifystandardsonshareholdersuitability

92. Maximumpermissibleholdings

93. Notificationonacquisitionordisposalofinterestinsharesoflicensedperson

Division2

ActionbyBankineventofbreach

94. Orderagainstdefaultingpersons
95. Additionalprovisionsrelatingtoorderundersubparagraph94(2)(a)(v)

Division3

Interestinsharesofapprovedperson
96. Interpretation

97. Acquisitionofinterestinsharesofapprovedperson

Division4

Transferofbusiness,reconstructionoramalgamationoflicensedperson
98. Interpretation

99. Approvalrequiredforreconstructionoramalgamationoflicensedperson

100. Approvalrequiredforbusinesstransferscheme

101. Notificationofbusinesstransferscheme

102. ApplicationtoHighcourtforconfirmationofbusinesstransferscheme

103. Banktobepartytoproceedings

104. Orderssoughtbytransferorandtransferee

105. Publicationofcourtorderundersection102

106. ReimbursementofBanksexpenses

107. Prohibitionofpaymentoutofinsurancefund

PARTVII

FINANCIALGROUPS
108. Purposeofthispart

109. Disapplicationofsections110and111tolicensedpersons

110. Applicationtobefinancialholdingcompany

111. PowerofBanktorequiresubmissionofapplication

112. Approvalofapplicationasfinancialholdingcompanyundersection110or111

113. Bankmayapprovemorethanonefinancialholdingcompany

114. Businessoffinancialholdingcompany

115. Prudentialrequirementsonfinancialholdingcompanyandsubsidiaries

116. Powertoissuedirectionstofinancialholdingcompanyandsubsidiaries

117. Generalprovisionsdealingwithdirections

118. Consequencesforfailingtocomplywithdirections

119. Additionalprovisionsrelatingtoparagraph116(3)(e)

120. Powertoremovedirectororchiefexecutiveofficeroffinancialholdingcompany

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PARTVIII

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BUSINESSCONDUCTANDCONSUMERPROTECTION

Division1

Interpretation

121. Interpretation

Division2

Businessconduct,complaints,disputes,etc.
122. Application

123. Standardsonbusinessconduct

124. Prohibitedbusinessconduct

125. Approvedinsurancebroker,approvedfinancialadviserandapprovedissuerof
designatedpaymentinstrumenttoestablishcustomeraccount

126. Financialombudsmanscheme

Division3

Insuranceissues
127. ObtaininginsuranceoutsideMalaysia

128. Provisionsrelatingtopolicies

129. Precontractualdisclosureandrepresentations,andremediesformisrepresentations

130. Paymentofpolicymoneysunderlifepolicyandpersonalaccidentpolicy

Division4

Informationandsecrecy
131. Interpretation

132. Restrictiononinquiringspecificallyintoaffairsofparticularcustomer

133. Secrecy

134. Permitteddisclosures

Division5

Restrictionsrelatingtoconsumerprotection
135. ApplicationofthisDivision

136. Deposit

137. Restrictiononacceptingdeposits

138. Advertisementsfordeposits

139. Restrictiononuseofcertainwords

PARTIX

MONEYMARKETANDFOREIGNEXCHANGEMARKET
140. PowerofBanktospecifystandardsorissuecodes

141. Prohibitedconductinmoneymarketandforeignexchangemarket

142. Arrangementwithrelevantsupervisoryauthority

PARTX

SUBMISSIONOFDOCUMENTORINFORMATION
143. SubmissionofdocumentorinformationtoBank

144. Submissionofstatisticalinformation,etc.

145. Secrecyrequirementsundersections143and144nottoapply

PARTXI

EXAMINATION
146. Examinationofauthorizedperson,etc.

147. Dutytoprovideaccessto,andproducedocuments,information,etc.

148. Examinationofotherpersons

149. AppearancebeforeBank

150. Examinationorassessmentbyauditororactuary

151. Confidentialinformation

152. Examinationbyrelevantoverseassupervisoryauthority

153. DisclosureofinformationbyBanktorelevantoverseassupervisoryauthority

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PARTXII

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DIRECTIONSOFCOMPLIANCE
154. Interpretation

155. Circumstancesforexercisingpowertoissuedirections

156. Powertoissuedirectionstoinstitution

157. Generalprovisionsdealingwithdirections

158. Consequencesoffailingtocomplywithdirections

159. Additionalprovisionsrelatingtoparagraph156(2)(b)

PARTXIII

INTERVENTIONANDREMEDIALACTION
160. ApplicationofthisParttomemberinstitution

Division1

Removalofdirector,chiefexecutiveofficerorseniorofficer
161. Interpretation

162. Powertoremovedirector,chiefexecutiveofficerorseniorofficer

163. Provisionsrelatingtoremoval

Division2

Powertotakeinterventionandremedialaction

Subdivision1Circumstancesforexercisinginterventionandremedialaction

164. Interpretation

165. CircumstancesforexerciseofBankspower

Subdivision2Assumptionofcontrol

166. Interpretation

167. Powertoassumecontrol

168. Effectofassumptionofcontrol

169. Informationandfacilities

170. Additionalprovisionsrelatingtoassumptionofcontrol

Subdivision3Powertoappointreceiverandmanager

171. Interpretation

172. AppointmentofreceiverandmanagerbyBank

173. AppointmentofreceiverandmanagerbypersonsotherthanBank

174. Provisionsinrelationtoappointmentofreceiverandmanager

Subdivision4Compulsorytransferofbusiness,assetsorliabilities

175. Interpretation

176. Orderforcompulsorytransferofbusiness,assetsorliabilities

177. Additionalprovisionsrelatingtocompulsorytransfer

178. Continuityobligations

Subdivision5Provisionsrelatingtobridgeinstitution

179. Designationofbridgeinstitution

180. Publicationofnotice

181. Bridgeinstitutionauthorizedtocarryonbusiness

182. Bridgeinstitutionnotliableforpastobligationsinrespectofofficers

183. Stayinrespectofbridgeinstitution

184. Financialassistancetobridgeinstitution

Subdivision6Restructuringofsharecapital

185. Interpretation
186. Powertoreducesharecapitalofinstitution

Subdivision7Financialassistance

187. Interpretation

188. Liquidityorfinancialassistancetoinstitution

Subdivision8Moratorium

190. Applicationformoratorium

189. Interpretation

Division3

Windingup

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Subdivision1Generalprovisionsonwindingup

191. Interpretation

192. ApplicationofCompaniesAct1965inrelationtowindingupofinstitution

193. Banktoapplyforwindingup

194. Restrictiononvoluntarywindingup

195. WindingupbyHighcourtonapplicationbypersonsotherthanBank

196. Appointmentandremunerationofliquidator

197. Controlofliquidator

198. Statementofaffairs

199. Offencesbyofficersofinstitution

Subdivision2Provisionsspecifictolicensedinsurers

200. Valuationofassetsandliabilities

201. Terminationofinsurancepolicy

202. Waiverofstrictproofofdebt

203. Prohibitionagainstissuanceofpolicy

204. Continuationoflifebusiness

Subdivision3Priorityofpaymentsinwindingup

205. Priorityofpaymentsinwindingupoflicensedinvestmentbank

206. PriorityofpaymentsinwindingupoflicensedinvestmentbankcarryingonIslamic
bankingbusiness
207. Applicationofinsurancefundinwindingup

Division4

GeneralprovisionsinrelationtoactionstakenbyBank
208. PowerofBanktotakeactionunderthisPart

209. Qualifiedfinancialagreement

210. Assessorcommittee

PARTXIV

OTHERPOWERSOFBANK

Division1

Regulationofprescribedfinancialinstitutions
211. Interpretation

212. PowerofMinistertoprescribefinancialinstitutions

Division2

Internationalanddomestictransactions
213. Interpretation

214. Measuresrelatingtointernationalanddomestictransactions

215. PowerofBanktoimposeleviesorcharges

216. PowerofBank,withapprovalofMinister,toissuedirections

Division3

Holidayforlicensedperson
217. PowerofMinistertodeclareholidayforlicensedperson

PARTXV

ENFORCEMENTANDPENALTIES

Division1

Investigationpowers
218. InvestigationbyBank

219. Appointmentofinvestigatingofficer

220. Powersofinvestigatingofficer

221. Powersofentry,searchandseizurewithwarrant

222. Powersofentry,searchandseizurewithoutwarrant

223. Listofseizedproperty,etc.

224. Releaseofseizedproperty,etc.

225. Searchofperson

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226. Obstructiontoexerciseofpowersbyinvestigatingofficer

227. Requirementtoprovidetranslation

228. Powertoexaminepersons

229. Serviceofordersornoticesgenerally,etc.

230. Surrenderoftraveldocuments

231. Agentprovocateur

232. Assistancetopoliceorotherpublicofficer

233. Investigatingofficerdeemedtobepublicservantandpublicofficer

Division2

Administrativeactions
234. PowerofBanktotakeaction

235. LodgmentofamountnotdistributedwithRegistrarofUnclaimedMoneys

236. PowerofBanktoprescribemonetarypenalty

237. Applicationforappealofdecisions

238. MonetarypenaltyReviewcommittee

Division3

Civilactions
239. CivilactionbyBank

240. Ordersbycourt

241. Civilactiontoseekcompensation

242. Interimorders

243. Contraventionofcourtorder

244. Noundertakingastodamages

245. Otheractions

246. Evidenceobtainedininvestigationsmaybeusedincivilproceedings

Division4

Criminaloffences
247. Imprisonment

248. Offencesinrelationtoentriesindocuments

249. Offencecommittedbyanypersonactinginofficialcapacity

250. Offencebyemployees,etc.

251. Seizableoffence

252. Dutyofinvestigatingofficertomakeoverarrestedpersontopolice

253. Powertocompound

254. Attempts,abetmentsandconspiracies

255. Prosecution

Division5

Generalmatters
256. ProtectioninrelationtodisclosureofinformationtoBank

257. Evidentialprovision

258. PowerofBanktopublishinformation

PARTXVI

GENERALPROVISIONS
259. Enforceableundertakings

260. Regulations

261. Provisionsrelatingtoapprovals,consents,standards,codes,specifications,notices,
requirements,directionsormeasures

262. Opportunitytomakerepresentations

263. Exemptions

264. PowerofMinistertoamendSchedule

265. DecisionofMinistertobefinal

266. PowerofBanktoissueguidance

267. Protectionagainstsuitsandlegalproceedings

268. ApplicationofCompaniesAct1965

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269. ApplicationofcertainprovisionsofActtolabuanentities

270. Breachorcontraventionnottoaffectcontract,agreementorarrangement

PARTXVII

REPEAL,SAVINGSANDTRANSITIONAL
271. Repeal

272. Savingsandtransitional

273. SavingsinrespectoflicencesgrantedunderrepealedActs

274. SavingsinrespectofIslamicfinancialbusiness

275. Savingsandtransitionalprovisioninrespectofspecificprovisionsofrepealed
InsuranceAct1996

276. Conversiontosingleinsurancebusiness

277. Designatedpaymentsystemsdeemedcertified

278. Savingsinrespectofapprovalsgranted,notificationgivenandprescriptionmade
underrepealedPaymentSystemsAct2003

279. Savingsinrespectofinterestinshares

280. Savingsinrespectoffinancialholdingcompany

281. Savingsinrespectofdepositsacceptedbycooperativesocieties

SCHEDULE1

SCHEDULE2

SCHEDULE3

SCHEDULE4

SCHEDULE5

SCHEDULE6

SCHEDULE7

SCHEDULE8

SCHEDULE9

SCHEDULE10

SCHEDULE11

SCHEDULE12

SCHEDULE13

SCHEDULE14

SCHEDULE15

SCHEDULE16

PARTI

PRELIMINARY

Shorttitleand 1.(1)ThisActmaybecitedastheFinancialServicesAct2013.
commencement
(2)ThisActcomesintooperationonadatetobeappointedbytheMinisterby
notificationintheGazetteandtheMinistermayappointdifferentdatesforthe
comingintooperationofdifferentpartsordifferentprovisionsofthisAct.

Interpretation 2.(1)InthisAct,unlessthecontextotherwiserequires

adjustermeansapersonwhocarriesonadjustingbusiness

adjustingbusinessmeansthebusinessofinvestigatingthecauseand
circumstancesofalossandascertainingthequantumofthelossinrelationto
insuranceortakafulclaims

advertisementmeansthedisseminatingorconveyingofinformation,invitation
orsolicitationbyanymeansorinanyformincludingoralandwritten
communicationbymeansofprint,electronicandanyothermedia

agreementmeansanagreementwhetherformalorinformal,oralorwritten,
expressorimplied

annuitymeanstherighttoaseriesofperiodicalpaymentsatintervalsofone
yearorlessunderacontractwithalifeinsurer

annuitycertainmeansanannuitywherethedurationofperiodicpaymentsis
predeterminedanddoesnotdependonthedeathorsurvivalofthepolicyowner

applicantmeans

(a) inPartIIIandSchedule5,thepersonwhosubmits,onitsownbehalfor
throughanadvocate,asecretarialfirmorotherdulyauthorized
representative,theapplicationforauthorizationundersection9

(b) inPartVIandSchedule6,thepersonwhosubmits,onitsownbehalfor
throughanadvocate,asecretarialfirmorotherdulyauthorized
representative,theapplicationforapprovalunderthatpartor

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(c) inPartVII,thepersonwhosubmitstheapplicationtobeafinancial
holdingcompanyorproposesanothercompanytobeafinancialholding
company

appointedactuarymeansanactuaryappointedbyalicensedinsurerunder
subsection74(1)orbytheBankundersection75

appointeddateinrespectofanyprovisionunderthisAct,meansthedate
appointedbytheMinisterundersubsection1(2)asthedateforthecominginto
operationofthatprovision

approvedbusinessmeansanybusinesssetoutinDivision1ofPart1of
Schedule1

approvedfinancialadvisermeansapersonapprovedundersection11tocarry
onfinancialadvisorybusiness

approvedinsurancebrokermeansapersonapprovedundersection11tocarry
oninsurancebrokingbusiness

approvedissuerofadesignatedpaymentinstrumentmeansapersonapproved
undersection11toissueadesignatedpaymentinstrument

approvedmoneybrokermeansapersonapprovedundersection11tocarryon
moneybrokingbusiness

approvedoperatorofapaymentsystemmeansapersonapprovedundersection
11tooperateapaymentsystemsetoutinparagraph1ofDivision1ofPart1of
Schedule1
approvedpersonmeansapersonapprovedundersection11tocarryonan
approvedbusiness

approvedrepresentativeofficemeansarepresentativeofficeinMalaysiaofa
foreigninstitutionapprovedbytheBankundersubsection19(4)

arrangementmeansanarrangementwhetherformalorinformal,oralorwritten,
expressorimplied

associatecorporationmeansacorporationinwhichnotlessthantwentyper

centbutnotmorethanfiftypercentofthevotingsharesofthatcorporationareheld
byanothercorporation,wherethefirstmentionedcorporationisanassociate
corporationoftheothercorporation
authorizationmeansthegrantofalicenceundersection10orthegrantofan
approvalundersection11

authorizedbusinessmeansalicensedbusinessoranapprovedbusiness

authorizedpersonmeansapersonlicensedundersection10orapprovedunder
section11tocarryonanauthorizedbusiness

Act701. Bankhasthesamemeaningasdefinedinsubsection2(1)oftheCentralBank

ofMalaysiaAct2009[Act701]
bankingbusinessmeans

(a) thebusinessof
(i) acceptingdepositsoncurrentaccount,depositaccount,savings
accountorothersimilaraccount

(ii) payingorcollectingchequesdrawnbyorpaidinbycustomersand

(iii) provisionoffinanceand

(b) suchotherbusinessasprescribedundersection3

Act125. bookshasthesamemeaningassignedtoitinsubsection4(1)oftheCompanies

Act1965[Act125]
bridgeinstitutionmeansabodycorporateestablishedoracquiredbytheBank,
anddesignatedasabridgeinstitutionundersubsection176(1)

businesstransferschememeansaschemeoftransferforbankingbusiness,
investmentbankingbusinessorinsurancebusiness

chiefexecutiveofficer,inrelationto

(a) abodycorporateorunincorporate,meansanindividual,howeverstyled,
who,eitherindividuallyorjointlywithoneormoreotherpersons,is
responsibleundertheauthorityofthedirectors,fortheconductofthe
businessandtheadministrationofsuchbodyor

(b) anauthorizedpersonwhichisestablishedasabranchinMalaysia,means
anofficerprincipallyresponsibleforthebusinessofthebranchin
Malaysia

childincludesanillegitimatechild,astepchildandachildadoptedunderany
writtenlawofMalaysiaorofanyplaceoutsideMalaysia,orunderacustom
recognizedbyaclass,categoryordescriptionofpersonsinoroutsideMalaysia
Act125. companyhasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965
Act56. computerhasthesamemeaningassignedtoitinsection3oftheEvidenceAct

1950[Act56]
computeroutputmeansastatementorrepresentation,whetherinwritten,
printed,pictorial,film,graphical,acousticorotherform

(a) producedbyacomputer

(b) displayedonthescreenofacomputeror

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(c) accuratelytranslatedfromastatementorrepresentationsoproduced

Act701. constituentdocumenthasthesamemeaningassignedtoitinsubsection2(1)of

theCentralBankofMalaysiaAct2009
corporategroupmeansagroupofcorporationswhicharerelatedtoeachother
Act125. corporationhasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965
Act502. cooperativesocietyhasthesamemeaningassignedtoitinsection2oftheCo

operativeSocietiesAct1993[Act502]
creditfacilitymeans

(a) thegivingofanyadvance,loanorotherfacilityinwhateverformorby
whatevernamecalled

(b) thegivingofaguaranteeor

(c) anyotherdealingortransactionasprescribedundersection4

depositmeansasumofmoneyacceptedorpaidontermsunderwhichitwillbe
repaidinfull,withorwithoutinterestoranyotherconsiderationinmoneyor
moneysworth,eitherondemandoratatimeorincircumstancesagreedbyoron
behalfofthepersonmakingthepaymentandthepersonacceptingit,butexcludes
moneypaidbonafide

(a) bywayofanadvanceorapartpaymentunderacontractforthesale,hire
orotherprovisionofpropertyorservices,andisrepayableonlyinthe
eventthatthepropertyorservicesarenotinfactsold,hiredorotherwise
provided

(b) bywayofsecurityfortheperformanceofacontractorbywayofsecurity
inrespectofanylosswhichmayresultfromthenonperformanceofa
contract

(c) withoutlimitingparagraph(b),bywayofsecurityforthedeliveryupor
returnofanyproperty,whetherinaparticularstateofrepairorotherwise
and

(d) insuchothercircumstances,ortoorbysuchotherperson,assetoutin
Schedule2

depositormeansapersonentitledtotherepaymentofadeposit,whetherthe
depositwasmadebyhimoranyotherperson

derivativemeansanyagreement,includinganoption,aswap,futuresor
forwardcontract,whosemarketprice,value,deliveryorpaymentobligationsis
derivedfrom,referencedtoorbasedon,butnotlimitedto,securities,commodities,
assets,rates(includinginterestratesorexchangerates)orindices

designatedpaymentinstrumentmeansapaymentinstrumentprescribedasa
designatedpaymentinstrumentundersection31

designatedpaymentsystemmeansapaymentsystemprescribedasadesignated
paymentsystemundersubsection30(1)
directorincludesanypersonwhooccupiesthepositionofadirector,however
styled,ofabodycorporateorunincorporate,andincludes

(a) apersoninaccordancewithwhosedirectionsorinstructionsthedirectors
orofficersofthebodyareaccustomedtoact

(b) analternateorsubstitutedirectoror

(c) inparticular,withoutlimitingtheforegoing,inthecaseof

(i) acorporation,hasthesamemeaningassignedtoitinsubsection4(1)
oftheCompaniesAct1965

(ii) acooperativesociety,meansamemberoftheboard,orother
governingbodyhowsoevercalled,ofthecooperativesociety

(iii) astatutorybody,meansamemberoftheboard,committee,councilor
othergoverningbodyhowsoevercalled,ofthestatutorybody

(iv) apartnership,meansapartner

(v) asoleproprietorship,meansthesoleproprietorand

(vi) anyotherbody,associationorgroupofpersons,whethercorporateor
unincorporate,meansanypersonhavingthedirectionandcontrolof
themanagementofitsaffairsorbusiness

Act125.

Act56. documenthasthesamemeaningassignedtoitinsection3oftheEvidenceAct

1950andincludesbooks
electronicmoneymeansanypaymentinstrument,whethertangibleor
intangible,that

(a) storesfundselectronicallyinexchangeoffundspaidtotheissuerand

(b) isabletobeusedasameansofmakingpaymenttoanypersonotherthan
theissuer

electronicterminalmeansanelectronicdevice,operatedbyoronbehalfofan
authorizedpersonoraregisteredperson,throughwhichapersonmayinitiatean
electronicfundtransfer,andincludesapointofsaleterminal,automatedteller
machineorcashorchequedepositmachine

factoringbusinessmeans

(a) thebusinessofacquiringdebtsduetoanypersonand

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(b) suchotherbusinessasprescribedundersection3

financialadvisersrepresentativemeansanindividual,howeverstyled,inthe
directemploymentof,actingfororbyarrangementwithanapprovedfinancial
adviser,whoperformsforthefinancialadviseranyservicesrelatingtofinancial
advisorybusiness

financialadvisorybusinessmeansanyofthefollowing:

(a) analyzingthefinancialplanningneedsofapersonrelatingtoaninsurance
product

(b) recommendinganappropriateinsuranceproducttoaperson

(c) sourcinganinsuranceproductfromalicensedinsurerforaperson

(d) arrangingofacontractinrespectofaninsuranceproductforapersonor

(e) suchotherbusiness,serviceoractivityinrelationtoafinancialserviceas
prescribedundersection3

financialgroupmeansafinancialholdingcompanyandagroupofrelated

corporationsundersuchfinancialholdingcompanyprimarilyengagedinfinancial
servicesorinotherservicesinconnectionwithorforthepurposesofsuchfinancial
serviceswhichincludesatleastonelicensedperson
financialholdingcompanymeansacompanywhich

(a) holdsanaggregateofmorethanfiftypercentofinterestinsharesofa
licensedperson,orhasanaggregateinterestinsharesoffiftypercentor
lessbuthascontroloveralicensedpersonand

(b) hasobtainedtheapprovaloftheBankpursuanttosubsection112(3)tobe
afinancialholdingcompanyofsuchlicensedperson

Act125. financialyearhasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965
Act125. foreigncompanyhasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965
foreigncurrencymeansanycurrencyotherthanringgit

foreigninstitutionmeansaforeigncompany,notbeinganauthorizedpersonor
aregisteredperson,whichcarriesonanybusinessoutsideMalaysiawhich
corresponds,orissimilar,tothebusinessofanyauthorizedpersonorregistered
person,whetherornotsuchpersonhasanapprovedrepresentativeoffice

foreigninsurermeansaninsurerincorporatedoutsideMalaysia

Act701. GovernorandDeputyGovernorhavethesamemeaningassignedtothemin

subsection2(1)oftheCentralBankofMalaysiaAct2009
Act125. holdingcompanyhasthesamemeaningassignedtoitinsection5ofthe

CompaniesAct1965
individualmeansanaturalperson

insuranceincludesreinsurance

insuranceagentmeansapersonwhodoesalloranyofthefollowing:

(a) solicitsorobtainsaproposalforinsuranceonbehalfofaninsurer

(b) offersorassumestoactonbehalfofaninsurerinnegotiatingapolicyor

(c) doesanyotheractonbehalfofaninsurerinrelationtotheissuance,
renewalorcontinuanceofapolicy

insurancebrokermeansapersonwho,asanindependentcontractor,carrieson
insurancebrokingbusinessandincludesareinsurancebroker

insurancebrokingbusinessmeansthebusinessofsoliciting,negotiatingor
procuringapolicywithaninsurer,ortherenewalorcontinuanceofthepolicybya
person,forapolicyownerotherthanforhimselfandincludesreinsurancebroking
foraninsurer

insuranceclaimmeansademandforpaymentofanamountdueunderapolicy

insurancefundmeansaninsurancefundestablishedandmaintainedunder
section81

insurerincludesaprofessionalreinsurer

interestinsharesshallbeconstruedassetoutinSchedule3

Act759. investmentaccounthasthesamemeaningassignedtoitinsubsection2(1)of

theIslamicFinancialServicesAct2013[Act759]
investmentbankingbusinessmeans

(a) thebusinessof

(i) acceptingdepositsondepositaccountand

(ii) provisionoffinance

Act671.

(b) anyregulatedactivitycarriedonpursuanttoaCapitalMarketsServices
licenceundertheCapitalMarketsandServicesAct2007[Act671]and

(c) suchotherbusinessasprescribedundersection3

Act125. investmentcompanyhasthesamemeaningassignedtoitinsubsection319(1)

oftheCompaniesAct1965

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investmentlinkedpolicymeansacontractofinsuranceonhumanlifeoran
annuitywherethebenefitsare,whollyorpartly,tobedeterminedbyreferenceto
units,thevalueofwhichisrelatedto

(a) theincomefrompropertyofanydescriptionor

(b) themarketvalueofsuchproperty

issuermeansanyperson,actingaloneorunderanarrangementwithanother
person,whoundertakestoberesponsibleforthepaymentobligationinrespectofa
paymentinstrumentresultingfromauserbeingissuedwithorusingthepayment
instrument

leasingbusinessmeans

Act212.

(a) thebusinessoflettingorsublettingmovablepropertyonhireforthe

purposeoftheuseofsuchpropertybythehireroranyotherpersoninany
business,trade,professionoroccupationorinanycommercial,industrial,
agriculturalorothereconomicenterprisewhatsoeverand,wherethelessor
istheowneroftheproperty,regardlesswhetherthelettingiswithor
withoutanoptiontopurchasetheproperty,butexcludesthebusinessof
hirepurchasewhichissubjecttotheHirePurchaseAct1967[Act212]
andforthepurposeofthisdefinition,movablepropertyincludesany
plant,machinery,equipmentorotherchattelattachedortobeattachedto
theearthorfastenedortobefastened,permanentlyorotherwise,toany
thingattachedtotheearthand
(b) suchotherbusinessasprescribedundersection3

liabilitiesincludesdebtsorobligationsofeverykind,whetherpresentorfuture,
orwhethervestedorcontingent

licencemeansalicencegrantedundersection10

licensedbankmeansapersonlicensedundersection10tocarryonbanking
business

licensedbusinessmeansbankingbusiness,insurancebusinessorinvestment
bankingbusiness

licensedinsurermeansapersonlicensedundersection10tocarryoninsurance
business
licensedinvestmentbankmeansapersonlicensedundersection10tocarryon
investmentbankingbusiness

licensedpersonmeansapersonlicensedundersection10tocarryonalicensed
business

lifebusinessmeansthebusinessofundertakingliabilityunderalifepolicy

lifepolicymeansapolicybywhichpaymentofpolicymoneysisinsuredon
deathorsurvival,includingextensionsofcoverforpersonalaccident,diseaseor
sicknessandincludesanannuitybutexcludesapersonalaccidentpolicy

Act720. MalaysiaDepositInsuranceCorporationmeanstheMalaysiaDeposit

InsuranceCorporationreferredtointheMalaysiaDepositInsuranceCorporation
Act2011[Act720]
MalaysianpolicymeansapolicywhichisissuedinMalaysiabyalicensed
insurerandis

Act53.

(a) alifepolicywherethepolicyownersaddress,asspecifiedinthepolicyor
anyotheraddresssubsequentlynotifiedinwritingbythepolicyownerto
theinsurer,isorwasanaddressinMalaysia
(b) ageneralpolicywhichrelatestorisksarisinginMalaysia,orwherethe
policyownerisaresidentof,orapermanentestablishmentin,Malaysia
withinthemeaningoftheIncomeTaxAct1967[Act53]or

(c) areinsurancecontractwithanotherlicensedinsurer

marketparticipantmeansanypersonwho

(a) issues,sells,purchases,repurchases,borrows,lendsorotherwisedeals
withcurrenciesorotherfinancialinstrumentstradedinthemoneymarket
orforeignexchangemarketincludingoverthecounterderivativeswhose
price,valueorpaymentobligationsarederivedfrom,referencedtoor
basedoninterestratesorexchangeratesor

(b) arrangestransactionsinthemoneymarketorforeignexchangemarketas
anintermediary,

whetheractingasaprincipaloranagent,andincludesanyotherpersonsas
prescribedundersection4

member,inrelationtoabodycorporateorunincorporatewhichis

(a) acorporation,meansashareholder

(b) acooperativesociety,meansamemberofthecooperativesociety

(c) apartnership,meansapartner

(d) anyotherbodycorporatehavingamembership,meansamemberofthe
bodyand

(e) asocietyregisteredundertheSocietiesAct1966[Act335],meansa
memberofthesociety

Act335.

merchantacquiringservicesmeansabusinessofanoperatorofapayment
systemthatentersintoacontractwithamerchantforthepurposeofaccepting
paymentinstrumentsforpaymentofgoodsorservices

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MinistermeanstheMinisterforthetimebeingchargedwiththeresponsibility
forfinance

moneybrokingbusinessmeansthebusinessofarrangingtransactionsbetween
buyersandsellersinthemoneymarketorforeignexchangemarketasan
intermediaryinconsiderationofbrokeragefeespaidortobepaid,butexcludesthe
buyingorsellingofMalaysiancurrencyorforeigncurrenciesasaprincipalinsuch
markets

officereferstoaplacewhereoratwhichanybusinessofanypersoniscarried
out,includingtheheadofficeinMalaysia,oranyotheroffice,abranch,anagency
(exceptforaninsuranceagencyinthecaseofalicensedinsurer),amobileplaceof
business,aplaceofbusinesssetupandmaintainedforalimitedperiodonlyoran
electronicterminal

officer,inrelationtoabodycorporateorunincorporate,includesanyemployee
orthechiefexecutiveofficerofthebodycorporateorunincorporate

operatormeansanyperson,actingaloneorunderanarrangementwithanother
person,responsiblefortherules,proceduresandoperationsofapaymentsystem

operatorofadesignatedpaymentsystemmeansanypersonwhooperatesa
designatedpaymentsystem

participantmeansanypersonwhoispermittedbytherulesgoverninga
paymentsystemtosendpaymentinstructionsorsettlementinstructionstothe
paymentsystemandwhoisboundbytherulesgoverningthepaymentsystem

participatinglifepolicymeansalifepolicyconferringarighttothepolicy

ownertoparticipateinallocations,ofwhichtheamountortimingisatthediscretion
oftheinsurer,fromtheassetsofaninsurancefundundersubsection81(2)
paymentinstructionorsettlementinstruction,inrelationtoapaymentsystem,
includesaninstructiontotransfer,clearorsettletransactionsinfundsorsecurities,
asthecasemaybe

paymentinstrumentmeansanyinstrument,whethertangibleorintangible,that
enablesapersontoobtainmoney,goodsorservicesortomakeanypayment

paymentsystemmeansanysystemorarrangementforthetransfer,clearingor
settlementoffundsorsecurities

personincludesanindividual,anycorporation,statutorybody,localauthority,
society,tradeunion,cooperativesociety,partnershipandanyotherbody,
organization,associationorgroupofpersons,whethercorporateorunincorporate

personalaccidentpolicymeansapolicyprovidingfixedpecuniarybenefitsor
benefitsinthenatureofindemnity,orboth,againstrisksofthepersoninsured
sustaininginjuryordyingastheresultofanaccidentorbecomingincapacitatedin
consequenceofdisease

policymeansaninsurancepolicyandincludesacovernoteoracontractof

insurance,whetherornotembodiedinorevidencedbyaninstrumentintheformof
aninsurancepolicy,andreferencesto

(a) issuingapolicyshallbeconstruedasenteringintoacontractofinsurance,
whetherornotaformalcontracthasbeenissuedand

(b) apolicyofaninsurerincludesapolicyorabondinrespectofwhichthe
insurerisunderanyliability,whetherthepolicywasissuedbytheinsurer
ortheliabilitywastransferredtotheinsurerfromanotherinsurer

policymoneysincludesanybenefit,whetherpecuniaryornot,whichissecured
byapolicy
policyownermeansthepersonwhohaslegaltitletoapolicyandincludes

(a) whereapolicyhasbeenassigned,theassignee

(b) whereapersonalrepresentativeofadeceasedpolicyownerisentitledas
againsttheinsurertothebenefitofapolicy,thepersonalrepresentative

(c) inrelationtoapolicyprovidingforthepaymentofannuity,anannuitant
and

(d) whereunderapolicy,moneysaredueorpayable,whetherperiodicallyor
otherwise,thepersontowhomthemoneysaredueorpayable

premisesincludesanyland,building,structureorplace

premiummeanstheamountpayabletoaninsurerunderapolicyas
considerationfortheobligationsassumedbytheinsurer

prescribemeanstoprescribebyanorderpublishedintheGazette,andapower
toprescribeincludesthepowertoprescribedifferentlyfordifferentpersons,
paymentsystemsorpaymentinstrumentsordifferentclasses,categoriesor
descriptionsofpersons,paymentsystemsorpaymentinstruments

professionalreinsurermeansareinsurerwhichislicensedtocarryonsolely
reinsurancebusiness

propertymeansanymovableorimmovableproperty,whethertangibleor
intangibleandincludes

(a) anyright,interest,title,claim,choseinaction,powerorprivilege,whether
presentorfuture,orwhethervestedorcontingent,inrelationtoany
property,orwhichisotherwiseofvalue

(b) anyconveyanceexecutedforconveying,assigning,appointing,

surrendering,orotherwisetransferringordisposingofimmovable
propertyofwhichthepersonexecutingtheconveyanceistheproprietoror
haspossessionorinwhichheisentitledtoacontingentright,eitherforthe

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wholeinterestorforanylessinterest

(c) anysecurity,includinganystock,share,debentureandfund

(d) anynegotiableinstrument,includinganybanknote,bearernote,Treasury
bill,dividendwarrant,billofexchange,promissorynote,chequeand
negotiablecertificateofdepositor

(e) anymortgageorcharge,whetherlegalorequitable,guarantee,lienor

pledge,whetheractualorconstructive,letterofhypothecation,trustreceipt,
indemnity,undertakingorothermeansofsecuringpaymentordischarge
ofadebtorliability,whetherpresentorfuture,orwhethervestedor
contingent

provisionoffinanceincludes

(a) lendingofmoney

(b) leasingbusiness

(c) factoringbusiness

(d) purchaseofbillsofexchange,promissorynotes,certificatesofdeposit,
debenturesorothernegotiableinstrumentsand

(e) theacceptanceorguaranteeofanyliability,obligationordutyofany
person

Act125. publiccompanyhasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965
registeredadjustermeansaregisteredpersoncarryingonadjustingbusiness

registeredbusinessmeansanybusinesssetoutinPart2ofSchedule1

registeredoperatorofapaymentsystemmeansaregisteredpersonoperatinga
paymentsystemsetoutinparagraph9ofPart2ofSchedule1

registeredpersonmeansaregisteredpersonundersubsection18(1)

reinsurancemeansinsurancecovereffectedbyaninsurerwithasecondinsurer
ontherisks,whollyorpartly,ithasacceptedandincludesanysimilararrangement
byabranchoftheinsurerinMalaysiawithitsbranchoutsideMalaysia(thehead
officeoftheinsurerbeing,forthispurpose,treatedasabranch)

Act125. related,inrelationtoacorporation,meansrelatedwithinthemeaningofsection

6oftheCompaniesAct1965
relative,inrelationtoanindividual,subjecttosubsection(2),means

(a) thespouseoftheindividual

(b) thebrotherorsisteroftheindividual,orofthespouseoftheindividual

(c) anylinealascendantordescendantoftheindividual,orofthespouseof
theindividual

(d) thespouseofanyindividualreferredtoinparagraph(b)or(c)

(e) anylinealdescendantofanindividualreferredtoinparagraph(b)or(d)

(f) anyuncle,auntorcousinoftheindividual,orofthespouseofthe
individualor

(g) anyspouse,oranylinealascendantordescendant,ofanindividual
referredtoinparagraph(f)

Act372. repealedActsmeanstheBankingandFinancialInstitutionsAct1989[Act372],
Act17. theExchangeControlAct1953[Act17],theInsuranceAct1996[Act553]andthe
Act553.
Act627. PaymentSystemsAct2003[Act627]
Act701. risktofinancialstabilityhasthesamemeaningassignedtoitinsection29of

theCentralBankofMalaysiaAct2009
seniorofficermeansaperson,otherthanthechiefexecutiveofficerora
director,havingauthorityandresponsibilityforplanning,directingorcontrolling
theactivitiesofanauthorizedperson,operatorofadesignatedpaymentsystemora
financialholdingcompanyincludingthechiefoperatingofficer,membersof
decisionmakingcommitteesandotherpersonsperformingkeyfunctionssuchas
riskmanagement,compliance,internalauditorotherfunctionsasmaybespecified
bytheBankundersection47

share,inrelationtoacorporation,meansanissuedshareofthecorporationand
includesstockexceptwhereadistinctionbetweenstockandshareisexpressedor
implied

specifymeanstospecifyinwritingbywayofstandardsoranyotherforms,
andapowertospecifyincludesthepowertospecifydifferentlyfordifferent
persons,paymentsystemsorpaymentinstrumentsordifferentclasses,categories
ordescriptionsofpersons,paymentsystemsorpaymentinstruments

standardsincludesanyobligationorrequirementasspecifiedbytheBank
underthisActandsuchstandardsmaycontainanyinterpretative,incidental,
supplemental,consequentialandtransitionalprovisionsastheBankconsiders
appropriate

statutorybodymeansanyauthorityorbody,whethercorporateor
unincorporate,established,appointedorconstitutedbyanywrittenlaw,but
excludesanylocalauthority

Act125. subsidiaryhasthesamemeaningassignedtoitinsection5oftheCompanies

Act1965

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systemicriskinrelationtoadesignatedpaymentsystem,means

(a) ariskthatthefailureofaparticipantoroperatortomeethispaymentor
settlementobligationswillcauseanotherparticipanttobeunabletomeet
hispaymentorsettlementobligationswhendueor

(b) ariskthatthefailureofaparticipantoroperatortomeethispaymentor
settlementobligationsmaycausesignificantliquidityorcreditproblems
thatmightthreatenthestabilityofthefinancialsystem

Act759. takafulclaimhasthesamemeaningassignedtoitinsubsection2(1)ofthe

[sic]

IslamicFinancialServicesAct2012
usermeansanypersontowhomadesignatedpaymentinstrumenthasbeen
issuedoranypersonwhousesadesignatedpaymentinstrumenttoobtainmoney,
goodsorservicesortomakeanypayment
Act125. votingsharehasthesamemeaningassignedtoitinsubsection4(1)ofthe

CompaniesAct1965.
Relative

(2)Forthepurposeofthedefinitionofrelativeinsubsection(1)

(a) theadoptionofanypersonbyanotherunderanywrittenlawofMalaysia
oranycountry,territoryorplaceoutsideMalaysia,orunderanycustom
recognizedbyanyclassofpersonsinMalaysiaorinanycountry,territory
orplaceoutsideMalaysia,shallbetreatedascreatingbetweentheadopter
andtheadoptedpersonthesamenaturalrelationshipastheadoptive
relationship,andotherrelationshipsinrelationtoitshallbedetermined
accordinglyand

(b) referencesthereintoarelationshipinclude,whererelevant,arelationship
byhalfblood.

Control

(3)ForthepurposesofthisAct,apersonshallbepresumedtohavecontrol
overalicensedpersonorcorporationifsuchperson

(a) hasaninterestofmorethanfiftypercentofthesharesinthelicensed
personorcorporationor

(b) unlessprovenotherwise

(i) hasthepowertoelect,appoint,removeorpreventfromelection,
appointmentorremoval,orcausetobeelected,appointed,removedor
preventedfrombeingelected,appointedorremoved,amajorityofthe
directorsofthelicensedpersonorcorporation

(ii) hasthepowertomakeorcausetobemadedecisionsinrespectofthe
businessoradministrationofthelicensedpersonorcorporation,and
togiveeffecttosuchdecisionsorcausethemtobegiveneffecttoor

(iii) isapersoninaccordancewithwhosedirections,instructionsor
wishesthedirectors,chiefexecutiveofficerorseniorofficersofthe
licensedpersonorcorporationareaccustomedorunderobligation,
whetherformalorinformal,toact,

andthephrasecontrolledorcontrollershallbeconstruedaccordingly.

Actinginconcert

(4)ForthepurposesofthisAct

(a) personsactinginconcertmeanspersonswho,pursuanttoanagreement,
arrangementorunderstanding,cooperateto

(i) acquirejointlyorseverallyinterestsinthesharesofacorporationfor
thepurposeofobtainingorconsolidatingcontrolofthatcorporation
or

(ii) actjointlyforthepurposeofexercisingcontroloveracorporation
and

(b) withoutlimitingthegeneralityofparagraph(a),thefollowingpersons
shallbepresumedtobepersonsactinginconcert,unlessproven
otherwise:

(i) acorporationanditsrelatedandassociatecorporations

(ii) acorporationandanyofitsdirectors,ortheparent,child,brotheror
sisterofanyofitsdirectors,orthespouseofanysuchdirectororof
anysuchrelative,oranyrelatedtrusts

(iii) acorporationandanypensionfundestablishedbyit

(iv) apersonandanyinvestmentcompany,unittrustfundoranyother
fundwhoseinvestmentssuchpersonmanagesonadiscretionary
basis

(v) apersonandhisclientwhichisacorporation,wheretheperson
managesonadiscretionarybasistheclientsfundsandhastenper
centormoreinterestinsharesoftheclientor

(vi) apersonwhoownsorcontrolstwentypercentormoreofthevoting
sharesofacorporationfallingwithinsubparagraph(i)andanyparent,
child,brotherorsisterofsuchperson,orthespouseofsuchpersonor
anysuchrelative,oranyrelatedtruststogetherwithoneormore
personsfallingwithinsubparagraph(i).

Qualifiedfinancialagreements

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(5)ForthepurposesofthisAct

(a) qualifiedfinancialagreementmeans
(i) amasteragreementinrespectofoneormorequalifiedfinancial
transactionsunderwhichifcertaineventsspecifiedbythepartiesto
theagreementoccur

(A) thetransactionsreferredtointheagreementterminateormaybe
terminated

(B) theterminationvaluesofthetransactionsundersubparagraph(i)
arecalculatedormaybecalculatedand

(C) theterminationvaluesofthetransactionsundersubparagraph(i)
arenettedormaybenetted,sothatanetamountispayable,

andwhereanagreementisalsoinrespectofoneormoretransactions
thatarenotqualifiedfinancialtransactions,theagreementshallbe
deemedtobeaqualifiedfinancialagreementonlywithrespecttothe
transactionsthatarequalifiedfinancialtransactionsandanypermitted
enforcementbythepartiesoftheirrightsundersuchagreement

(ii) anagreementrelatingtofinancialcollateral,includingatitletransfer
creditsupportagreement,withrespecttooneormorequalified
financialtransactionsunderamasteragreementreferredtoin
subparagraph(i)or

(iii) anyotheragreementasprescribedundersection4

(b) qualifiedfinancialtransactionmeans

(i) aderivative,whethertobesettledbypaymentordeliveryor

(ii) arepurchase,reverserepurchaseorbuysellbackagreementwith
respecttosecurities

(c) financialcollateralmeansanyofthefollowingthatissubjecttoan
interestorarightthatsecurespaymentorperformanceofanobligationin
respectofaqualifiedfinancialagreementorthatissubjecttoatitletransfer
creditsupportagreement:

(i) cashorcashequivalents,includingnegotiableinstrumentsand
demanddeposits

(ii) security,asecuritiesaccountorarighttoacquiresecuritiesor

(iii) futuresagreementorfuturesaccount

(d) titletransfercreditsupportagreementmeansanagreementunderwhich
titletopropertyhasbeenprovidedforthepurposeofsecuringthepayment
orperformanceofanobligationinrespectofaqualifiedfinancial
agreement.

Act759. (6)AnyreferenceinthisActtothisAct,theIslamicFinancialServicesAct
Act701. 2013ortheCentralBankofMalaysiaAct2009shall,unlessotherwise

expresslystated,bedeemedtoincludeareferencetoanyrule,regulation,order,
notificationorothersubsidiarylegislationmadeunderthisAct,theIslamic
FinancialServicesAct2013ortheCentralBankofMalaysiaAct2009,asthecase
maybe.

Prescriptionby 3.TheMinistermay,ontherecommendationoftheBank,prescribe
Ministerofadditional
businessoractivity

(a) anybusinessoractivityasanadditiontothedefinitionof

(i) bankingbusiness

(ii) investmentbankingbusiness

(iii) financialintermediationactivities

(iv) factoringbusinessor

(v) leasingbusiness,

anduponsuchprescription,thedefinitionasaddedtoshallbedeemedto
beanintegralpartofthisActasfromthedateofcommencementofsuch
prescription,orfromsuchlaterdateasmaybespecifiedintheorderand

(b) anybusiness,serviceoractivityinrelationtoafinancialserviceasa
financialadvisorybusinessforthepurposesofthedefinitionoffinancial
advisorybusinessundersubsection2(1).

PrescriptionbyBank 4.TheBankmay,withtheconcurrenceoftheMinister,prescribe
ofadditional
agreement,dealing,
transactionorperson

(a) anyagreementinrespectofafinancialtransactionthatmaybeenteredinto
bypartiesinthefinancialmarkets,otherthanastandardizedderivativeor
anagreementinrespectofsecuritiestransactionsenteredintounderthe
rulesofastockexchangeandapprovedclearinghouseasdefinedin
subsection2(1)oftheCapitalMarketsandServicesAct2007asa
qualifiedfinancialagreementforthepurposesofthedefinitionof
qualifiedfinancialagreementinsubsection2(5)

(b) anydealingortransactionasacreditfacilityforthepurposesofthe
definitionofcreditfacilityinsubsection2(1)and

(c) anyotherpersonasamarketparticipantforthepurposesofthedefinition

Act671.

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ofmarketparticipantinsubsection2(1).

Classificationof,and 5.(1)ForthepurposesofthisAct,insurancebusinessshallbedividedinto
constructionof twoclasses
referencesto,insurance
business

(a) lifebusiness,whichinadditiontoallinsurancebusinessconcernedwith
lifepoliciesshallincludeanytypeofinsurancebusinesscarriedonas
incidentalonlytothelifeinsurersbusinessand

(b) generalbusiness,whichmeansallinsurancebusinesswhichisnotlife
business.

(2)ForthepurposesofthisAct,thereinsuranceofliabilitiesunderinsurance
policiesshallbetreatedasbelongingtothesameclassanddescriptionasthe
insurancepoliciesbeingreinsured.

(3)Notwithstandinganythinginsubsection(1)orthedeterminationofapolicy
toaparticularinsurancefundbyalicensedinsurer,iftheBankissatisfiedthatany
partofthelicensedinsurersbusinesswhichbelongstoaparticularclassor
descriptionofinsurancebusinessoughtinthatlicensedinsurerscasetobetreated
asbelongingtoanotherclassordescription,theBankmaydirectthatitshallbeso
treatedforthepurposesofthisAct.

(4)ForthepurposesofthisAct

(a) theactivityof
(i) effectingacontractofinsuranceor

(ii) carryingoutacontractofinsurance,

bywayofbusinessshallconstitutethecarryingonofinsurancebusiness
(b) apersonisdeemedtoeffect,orcarryout,acontractofinsurancebyway
ofbusinessifhe

(i) engagesinsuchactivityinamannerwhichinitselfconstitutesthe
carryingonofabusiness

(ii) holdshimselfoutaswillingandabletoengageinsuchactivityor

(iii) regularlysolicitsotherpersonstoengagewithhimintransactions
constitutingsuchactivityand

(c) areferencetocarryingoninsurancebusinessincludescarryingiton

throughanagent,orasanagent,butinsurerdoesnotincludean
insuranceagentassuchnorinthecaseofapersonwhoisbothinsurerand
insuranceagent,anybusinessdonebythatpersonasaninsuranceagent.

(5)ForthepurposesofthisAct

(a) theMinistermay,ontherecommendationoftheBank,prescribeany
businessoractivityasinsurancebusiness

(b) theBankmaydeterminesuchbusinessoractivitytobelongtoaparticular
classreferredtoinsubsection(1)ordescription,ofinsurancebusiness
and

(c) thebusinessessetoutinSchedule4shallnotbetreatedasinsurance
business.

PARTII

REGULATORYOBJECTIVESANDPOWERSANDFUNCTIONSOF
BANK

Regulatoryobjectives 6.TheprincipalregulatoryobjectiveofthisActistopromotefinancialstability

andinpursuingthisobjective,theBankshall

(a) foster
(i) thesafetyandsoundnessoffinancialinstitutions

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