Companies Commission of Malaysia (“CCM”) has implemented the automatic compound rate reducing method as a remedial solution for the compound within a specified period starting from 1 July 2019. The automatic compound rate reducing method serves as a remedial solution for the compound within a specified period. This approach also aims to encourage the corporate community to comply with the provisions of the Companies Act 1965 and the Companies Act 2016.
The main purpose of implementing this new method is to provide benefit to the corporate community to enjoy a higher compound reduction rate without having to submit an appeal to the CCM.
The mechanisms and the rate of automatic compound reduction are as follows:
| Payment Period From Date of Compound | Reduction Rate From the Original Compound Issued |
|---|---|
| 1 to 40 days | 85% |
| 41 to 60 days | 75% |
| 61 to 90 days | 60% |
| 91 to 180 days | 30% |
The reduction of the compound will automatically be given to the compounds issued for offences under the Companies Act 1965 and the Companies Act 2016, except:
- Compound for Out-of-Court or Investigation Papers issued by the Prosecution & Litigation Division and State / Branch Office;
- Expired Compounded but regenerated for payment process; and
- Compound that has been given a reduction through the previous appeal process.
Reductions will be given during the payment made at any CCM counter throughout Malaysia.
