* Labuan Foundations Act 2010

Original Language Title: * Labuan Foundations Act 2010

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Laws of MALAYSIA ONLINE VERSION of the PRINT TEXT that UPDATES Act 706 LABUAN FOUNDATION 2010 As ACT on 1 August 2015 2 LABUAN FOUNDATION ACT, 2010 date of Assent......... January 31, 2010 the date of publication in the Gazette............ February 11, 2010 3 laws of MALAYSIA Act 706 LABUAN FOUNDATION ACT 2010 ARRANGEMENT of SECTIONS part I preliminary section 1. Short title and commencement 2. Interpretation part II ADMINISTRATION Act 3. Administration of Act PART III ESTABLISHMENT of LABUAN FOUNDATION 4. The establishment of the Labuan Foundation 5. Labuan Foundation founder 6. Beneficiary under the Labuan Foundation 7. The purpose and goals of the Foundation Labuan 8. Labuan Foundation Charter 9. Amendment of the Charter 10. Labuan Foundation article 11. Labuan Foundation property 4 laws of Malaysia ACT 12 Section 706. Powers and obligations of the founder of PART IV REGISTRATION of LABUAN FOUNDATION 13. The name Labuan Foundation 14. Registration 15. Certificate of registration 16. Express Foundation Labuan 17. Change item 18. Change of name 19. Labuan Foundation rights and obligations not affected by change of name 20. Deduction is 21. The effect of the cut in the 22. Restoration to the register 23. Labuan re Pendomisilan 24. Pendomisilan the other part V COUNCIL, officers and SECRETARIES of the Council 25. The appointment of the Council of 26. Council meeting 27. Disqualification Councilman 28. Termination of Councilman 29. The appointment of people who oversee 30. Appointment of members of the Council by the Court 31. The power Council 32. Rights Council 33. Labuan Foundation Council obligations 5 Section 34. A reference to the Council apply to Councilman acting you jointly and severally Officer 35. Appointment of officers 36. 37 officers meeting. Loss of eligibility officer 38. Duty of officer 39. Termination of the officers 40. Remuneration of Officers Secretary 41. Secretary 42. Termination of Secretary 43. Documents shall be filed through the Office Secretary registered 44. Documents shall be filed through the Secretary of 45. Documents shall be kept at the registered office 46. Labuan Foundation records form 47. Translation of documents and instruments 48. Inspection and production of documents stored by yayasan Labuan 49. Inspection and production of documents kept by the Board PART VI the ABILITY FOUNDATION LABUAN 50. The capacity and power of 51. Confirmation of acts done beyond the ability of the 6 laws of Malaysia ACT 52 Section 706. Of any officer shall be binding on Labuan Foundation 53. Completion of contract, documents by yayasan Labuan 54. Disclosure of interest 55. The liability of the members of the Council, those who supervise, 56 officers and Secretary. The Court may give relief is 57. Money or other property from illegal activities law 58. Disposal of fraudulently 59. Accounts shall be kept 60. Labuan 61 Foundation audit. Cannot place a claim or judgment abroad PART VII BENEFICIARY 62. Rights of beneficiaries for information related to its stake in 63. The rights of the beneficiary for the confidentiality of 64. The Court may order the information given to beneficiary 65. Distribution of property to beneficiaries ' 66. Delegation of the power to authorize the distribution to the beneficiary by PART VIII DISSOLUTION of 67. Dissolution of 68. Kuasa Mahkamah untuk memerintahkan pembubaran 69. Pembahagian harta Yayasan Labuan 7 BAHAGIAN IX PERUNTUKAN AM Seksyen 70. Fi 71. Kerahsiaan 72. Hak untuk mendapatkan maklumat 73. Sulit 74. Pendakwaan 75. Kesalahan yang berhubungan dengan dokumen yayasan Labuan 76. Kesalahan oleh pertubuhan perbadanan 77. Kuasa mengkompaun 78. The authority to impose administrative penalties 79. General power to fix and determine the 80. Power of Minister to make regulations 81. Minister's power to amend the schedule of 82. Power of Minister to give exceptions 83. Procedure where no fixed 84. Application of the Labuan financial services Board Act 1996 FIRST SCHEDULE SECOND SCHEDULE of the THIRD SCHEDULE of the FOURTH SCHEDULE of the FIFTH SCHEDULE 9 laws of MALAYSIA Act 706 LABUAN FOUNDATION ACT 2010 an act to provide for the establishment, regulation and the dissolution of the Foundation in Labuan and for matters connected therewith.

[11 Feb 2010]

Enacted by the Parliament of Malaysia as follows: part I preliminary short title and commencement 1. (1) this Act may be cited as the Labuan Foundation Act 2010.

(2) of this Act come into force on such date as the Minister may, by notification in the Gazette.


Interpretation 2. In this Act, unless the context otherwise requires — "articles" means the articles of a foundation of Labuan pursuant to section 10;

"the initial asset" means property donated permanently by the founder or founders-founders, as the case may be, at the time of the establishment of a foundation Labuan and vested in and is the property of the Foundation;
10 laws of Malaysia ACT 706 "beneficiary" means a person designated as beneficiary under the provisions of the constituent documents of a foundation of Labuan;

"remaining beneficiary" means a person or persons who, in accordance with the constituent documents of a foundation of Labuan, is entitled to receive any property left after the liquidation or winding up of the Labuan Foundation;

"register" means the register of Labuan Foundation registered under this Act that are maintained under section 16;

"constituent document" means a Charter and articles of Association, a foundation of Labuan;

"property" includes — (a) every property type, whether zahir or intangible, movable or immovable, tangible or intangible, however acquired; and (b) the document or legal instrument in any form, including electronic or digital, evidencing title to or interest in any property described in paragraph (a), including bank cheques, money orders, shares, securities, bonds, bank drafts and letters of credit;

"Malaysian property" means any property which is situated in Malaysia;

"approved auditor" means a person approved by the Board as an auditor approved under section 10 of the companies act of Labuan 1990 [Act 441];

"Labuan" means the Federal territory of Labuan;


"Board" means the Board of Labuan financial services established under section 3 of the Labuan Financial Services Act 1996 [Act 545];

Labuan Foundation 11 "Court" means the High Court or a high court judge;

"majlis" dan "anggota majlis" ertinya majlis sesuatu yayasan Labuan yang dilantik mengikut seksyen 25 dan anggota majlis hendaklah ditafsirkan sewajarnya;

"Malaysia" means province in the Federation of Malaysia, the Malaysian territory waters and seabed and soil waters territory, and includes any area beyond the territorial boundaries of Malaysia, and seabed and soil under any of the area, which has been or will be hereinafter specified under the laws of Malaysia and in accordance with international law as an area against which Malaysia has the right of sovereignty, for the purpose of setting and exploit natural resources either in the form of living or non-living;

"donation (s)" means the transfer, or covenants to transfer, ownership of property, decisively so that transfer of title of the property transferred title effectively, with or without consideration, to a foundation so that such property be Labuan property the Labuan Foundation;

"Minister" means the Minister for the time being charged with the responsibility for finance;

"person" includes a corporation, a partnership, a body of persons, incorporated or unincorporated, and a corporation a;

"those who supervise" means any person or group of persons having authority supervision toward something Foundation Labuan and appointed under the Labuan Foundation Charter;

"Charter" means a foundation Charter of Labuan pursuant to section 8;

12 laws of Malaysia ACT 706 "officer" means an officer of Labuan Foundation appointed in accordance with section 35;

"pegawai diberi kuasa" ertinya mana-mana pegawai yang diberi kuasa dengan sewajarnya oleh Lembaga di bawah subseksyen 3(2);

"resident" means any person — (a) who is a citizen or permanent resident of Malaysia; or (b) which had established a place of business and is operating in Malaysia, other than a company Labuan or Labuan foreign company incorporated or registered under the companies act of Labuan 1990, something Labuan Foundation established under this Act, a partnership registered under the Limited Partnerships and limited liability partnerships Labuan 2010 [Act 707], and includes any person declared as a resident pursuant to section 43 the Exchange Control Act 1953 [Act 17];

"administrative penalty" means a penalty imposed under section 78;

"founder" means people who lose his hand at Charter that establishes a foundation for Labuan acting either for itself or on behalf of another person and who, through the transfer of ownership, the donated asset (s) start of the Labuan Foundation;

"certificate of registration" means a certificate of registration issued under section 15 when a Labuan Foundation registered;

"Corporation" means any body corporate, established or incorporated, or who are in or outside Malaysia Foundation Labuan 13 and includes any company Labuan foreign but does not include — (a) any corporation a;

(b) any trade union registered under the law as a Trade Union;
and (c) any organization registered under any written law relating to co-operative societies;

"Secretary" means a Labuan trust company appointed as Secretary in accordance with section 41;

"syarikat Labuan" mempunyai erti yang diberikan kepadanya dalam Akta Syarikat Labuan 1990.


PART II ADMINISTRATION of ACT administration of Act 3. (1) the Board shall be responsible for the administration of this Act, subject to the general direction and control of the Minister.

(2) the Board may authorize any member or officer to perform any of its functions, exercise any of its powers or perform any of its obligations under this Act.

(3) subject to such limitations, if any, as may be prescribed by the Board, an authorized officer shall use all of the powers, perform all the duties and exercise all the functions of the Board and of each such power is used, the obligation undertaken 14 laws of Malaysia ACT such and 706 carried out such functions shall be deemed to have been used, implemented and carried out accordingly for the purposes of this Act.


PART III ESTABLISHMENT of LABUAN Labuan Foundation FOUNDATION the establishment of 4. (1) any person may, by lowering his hand at Labuan as a Charter founder and Foundation in compliance with the requirements of this Act, to establish a foundation of Labuan.

(2) the establishment of a foundation for Labuan is not perfect until a registration certificate in respect of the Labuan Foundation has been issued under part IV.


Labuan Foundation founder 5. (1) the founder of a foundation of Labuan may be a resident or non-resident.

(2) the assets of the Foundation Labuan can not include any property Malaysia unless the consent of the Board obtained prior or foundation the Foundation for Labuan is charitable.


Beneficiary under the Labuan Foundation 6. (1) the Beneficiary-beneficiary for Labuan Foundation may be a resident or non-resident.

(2) if the property of a Foundation, including Labuan, Malaysia income tax Act 1967 [Act 53] shall apply to any income arising therefrom.
Yayasan Labuan 15 (3) Pendapatan yang berpunca daripada apa-apa harta yang bukan harta Malaysia adalah tertakluk kepada Akta Cukai Aktiviti Perniagaan Labuan 1990 [Akta 445].


Maksud dan matlamat yayasan Labuan 7. (1) Maksud atau matlamat utama suatu yayasan Labuan hendaklah pengurusan hartanya.

(2) Walau apa pun subseksyen (1), maksud atau matlamat suatu yayasan Labuan boleh termasuk apa-apa maksud atau matlamat yang tidak menyalahi undang-undang, tidak bertentangan dengan moral atau tidak bertentangan dengan mana-mana dasar awam di Malaysia dan apa-apa maksud atau matlamat itu boleh bersifat khairat atau bukan khairat.

(3) the purpose or goal of a foundation of Labuan shall be expressly mentioned in the piagamnya.

(4) a Labuan Foundation may, in the course of management

their wealth, do any thing and exercise such powers as are necessary for the proper administration of his property, including but not limited to the purchase and sale of the property and engaging in any act or activity which is not prohibited under any law in force in Malaysia, but the Act or such activity shall be incidental or related to the purpose or goal of the Labuan Foundation.


Labuan Foundation Charter 8. (1) every Labuan shall have the Foundation's Charter, which must be duly signed by each founder.

(2) the Charter of a Labuan Foundation shall state the details specified in the first schedule.
16 laws of Malaysia ACT 706 (3) a foundation Charter of Labuan could provide for, but not limited to, the matters specified in the second schedule.

(4) Jika piagam tidak mengandungi apa-apa peruntukan mengenai apa-apa perkara, peruntukan Akta ini berkenaan dengan perkara itu hendaklah terpakai.


Charter amendment 9. (1) if the Charter of a Labuan Foundation provide for amendment of the Charter, the Charter may be amended in accordance with the procedure set out in the Charter or, if the Charter does not contain any such procedures, according to the following procedure: (a) the founder or officer shall call a meeting consisting of — (i) the founder or his estate, as the case may be;

(ii) officers; and (iii) the Council of the Foundation of Labuan, if any; and (b) resolution for amendment of the Charter shall be adopted only if approved by — (i) the founder or his estate, as the case may be;

(ii) officers; and (iii) the Council of the Foundation of Labuan, if any.

(2) an Officer of Labuan Foundation can make a resolution on the amendment to the Charter of the Foundation such as Labuan Labuan 17 Foundation at their opinion is necessary in the circumstances to maintain the purposes and goals of the Labuan Foundation, and shall apply to the Court for his approval on the proposed amendment to the Charter in the case of Foundation Labuan — (a) a consensus could not be reached for any proposed amendment to the Charter;

(b) piagam itu tidak mempunyai peruntukan bagi pindaan;
or (c) the provisions of this section shall not be complied with because its founders are no longer live or exist.

(3) the Court may, in an application under subsection (2), make an order confirming the alteration, whether wholly or partly, on such terms and conditions as it deems fit by it, or may make such other order as may be deemed expedient by him to facilitate or perform effectively any such amendments, or reject the application.


Labuan Foundation article 10. (1) if the Charter of a Labuan Foundation provide that the articles shall be made or may be made, the article could provide for, but not limited to, the matters specified in the third schedule.

(2) where a foundation of Labuan there are articles on any matter, the provisions of this Act in respect of the matter shall apply.


Labuan Foundation assets 11. (1) any property donated permanently to a foundation of Labuan shall be the property of the Foundation of the Labuan with 18 laws of Malaysia ACT 706 of title in legal and beneficial title in full, and shall cease to be the founder of the property and may not be the property of a person is a beneficiary unless the property is divided according to the provisions of the constituent documents and the provisions of this Act.

(2) the assets of a foundation of Labuan shall be managed in particular, including realised, used, administered, invested and spent in accordance with the constituent documents and the provisions of this Act to achieve the purpose or goal of the Labuan Foundation.


Powers and obligations of the founder of 12. (1) Jika terdapat lebih daripada seorang pengasas, kuasa pengasas di bawah dokumen konstituen dan Akta ini hanya boleh dijalankan oleh kesemua pengasas itu secara bersesama dan dengan niat yang sama, melainkan jika dokumen konstituen memperuntukkan selainnya.

(2) the founders shall, in Labuan Foundation Charter or by instrument in writing which may be cancelled or cannot be cancelled, assign or transfer any or all of the rights, powers and obligations under this Act and the constituent documents of the Foundation of Labuan to any person as determined by the founder of the sole and absolute discretion.

(3) the person to whom the founders have assign or transfer any or all of the rights, powers and obligations under this Act and the constituent documents of the Foundation shall be deemed to Labuan founder when using any rights and exercise the powers and perform the obligations.

(4) where the founders make an undertaking, which is recorded in the Foundation's Charter, to donate the Labuan permanently any property to the Foundation, Foundation of Labuan Labuan Labuan Foundation the — 19 (a) can enforce the undertaking of the founder; and (b) shall give effect to the undertaking in respect of the assets of the Foundation permulaaan Labuan, if at the end of the period of twelve months from the date of registration, property which is the initial assets has not become the property of the Foundation of Labuan.


PART IV REGISTRATION of LABUAN Labuan FOUNDATION name of Foundation 13. (1) the name of a foundation of Labuan shall end with the words "Labuan Foundation" or "(L) Foundation".

(2) the name of a foundation of Labuan may — (a) in Latin, any word or words in the native language of any country which means a Foundation, or any abbreviations, as part of his name; or (b) in the letters, the alphabet or foreign language provided that the translation is accurate and has been endorsed for the name in English is used and clearly in every written communication sent by or on behalf of, the Labuan Foundation and every document issued or signed by or on behalf of, the Labuan which form the Foundation of evidence or create obligations in law for the Foundation.

(3) Kecuali dengan persetujuan Menteri, sesuatu yayasan Labuan tidak boleh didaftarkan jika nama yayasan Labuan yang hendak 20 Undang-Undang Malaysia AKTA 706 didaftarkan itu adalah pada pendapat Lembaga mengelirukan dalam

any manner or otherwise undesirable.

(4) no description about a foundation of Labuan shall be deemed insufficient or incorrect by reason of the use of the abbreviation or acronym-abbreviation in lieu of any word or words referred to in subsection (2).


Registration 14. (1) an application for the registration of a foundation of Labuan shall be made by the Secretary to the Board of the Foundation of Labuan in the form provided by the Board, and accompanied by the prescribed fee and the documents specified in the fourth schedule.

(2) the Secretary shall, before the application is made in subsection (1), conduct a reasonable investigation to verify the information disclosed in the application.

(3) the Secretary shall submit any other items as may be desired by the Secretary at its absolute discretion to be included in the application.

(4) the Board may request further details presented by yayasan Labuan applying to be registered.


Perakuan pendaftaran 15. (1) when a registered yayasan Labuan, the Board shall issue a certificate in respect of the registration and the certificate shall be signed by the Board or any officer given his powers and sealed with the seal of the Board.

(2) the certificate of registration issued under subsection (1) shall be conclusive evidence that the Foundation Yayasan Labuan 21 Labuan is registered, with the name specified in the certificate, with the Board.


Express Foundation Labuan 16. The Board shall maintain or cause maintained a register of Labuan Foundation registered under this Act.


Change item 17. (1) if any changes were made or incurred in respect of any item that is registered in respect of an Foundation of Labuan, Labuan Foundation Secretary shall within thirty days after the change, or any extended period permitted by the Board upon the application, file with the Board a notice signed by an officer of Labuan Foundation, which States that the form of the change.

(2) where a foundation Labuan did not comply with subsection (1), Foundation of the Labuan, Secretary and every officer who is in default may be penalty administration.


Change of name 18. (1) a foundation of Labuan may, if permitted by the piagamnya, change its name.

(2) Jika sesuatu yayasan Labuan menukar namanya, yayasan itu hendaklah menyerahkan notis mengenai pertukaran itu kepada Lembaga mengikut peruntukan subseksyen 17(1).

(3) where a foundation Labuan did not comply with subsection (2), the Labuan Foundation, Secretary and every officer who is in default may be penalty administration.
22 laws of Malaysia ACT 706 (4) If the Board approved the name proposed by the Foundation as its new name of Labuan, the Board may, when prescribed fee, issue a certificate of registration for the the name of the Foundation of its new Labuan and once issued the certificate of registration change of name shall be in force.

(5) if the name of a foundation of Labuan, whether accidental or otherwise and whether originally or by change of name, which is the name of Labuan Foundation shall not be registered without contravention of section 13, the Labuan Foundation changed its name to a name that has been approved by the Board.

(6) if the Board approves the change of name Foundation of Labuan under subsection (5), Labuan Foundation shall change its name within such thirty days after the date of the approval or any extended period permitted by the Board, unless the Minister may, by notice in writing, cancel the approval.


Labuan Foundation rights and obligations not affected by change of name 19. (1) a change of name does not affect the identity Foundation Labuan Labuan Foundation or any of the rights or obligations of the Foundation of the Labuan or defaces any proceedings by or against the Foundation of the Labuan.

(2) any proceedings, whether civil or criminal, pending or existing by or against the Foundation of the Labuan before his name, may be continued or commenced by or against the Foundation of the new name of Labuan Foundation the Labuan Cutting 20. (1) Notwithstanding any provision in this Act, if the Board is satisfied that a foundation of Labuan – Labuan Foundation 23 (a) fails to pay the annual fee referred to in section 68; atau (b) melanggar mana-mana peruntukan Akta ini, Lembaga boleh menyampaikan suatu notis kepada yayasan Labuan itu memberitahunya bahawa nama yayasan Labuan itu akan dipotong daripada daftar, melainkan jika yayasan Labuan itu mengambil apa- apa langkah atau tindakan untuk meremedi pelanggaran itu sebagaimana yang dinyatakan dalam notis itu dalam tempoh tiga puluh hari dari tarikh notis itu atau apa-apa tempoh yang lebih lama yang dilanjutkan oleh Lembaga.

(2) if the Board – (a) receives from Labuan the Foundation a notice stating that it is probable that the Foundation is unable to meremedi infringement as specified in the notice served upon the Foundation of Labuan under subsection (1); or (b) did not receive any reply to the notice delivered to the Labuan Foundation under subsection (1), the Board may, within thirty days from the date of expiration of the period specified in the notice served under subsection (1) or after that, delete the name of Express Foundation Labuan unless the Labuan Foundation or of any person to satisfy the Board that the name should not be cut.


The effect of the deduction is 21. (1) if the name of a Labuan Foundation be deducted from the register, the Labuan Foundation, liquidator and the Labuan Foundation recipient, cannot — 24 laws of Malaysia ACT 706 (a) start or make the defense in any legal proceedings, to carry out any business or by any other means managing the Labuan Foundation;

(b) make the defense in any legal proceedings, to make any claim or claim any rights for, or on behalf of the Labuan Foundation; or (c) Act in accordance with any other means with respect to the matters of the Labuan Foundation Affairs.

(2) Notwithstanding subsection (1), if the name of a foundation of Labuan has been deducted from the register, the Labuan Foundation, liquidator and receiver the Labuan, Foundation may — (a) apply to the Board to restore the name Labuan Foundation into the register;

(b) continue the defence of proceedings

instituted against Labuan Foundation before the deduction date; and (c) continuing any legal proceedings that have been initiated on behalf of the Foundation prior to the date the deletion of Labuan.

(3) the fact that the name of a foundation of Labuan has been deducted from the register shall not be construed as preventing — (a) that Labuan from Foundation be liable for any liability, claims, debts, and from the exercise of any of its obligations;

(b) any person from making any claims against the Foundation of Labuan and continue the claim until the judgement or its implementation; or Foundation Labuan 25 (c) of the Court to make any order provided under this Act.


Restoration to the register of 22. (1) if the name of a foundation of Labuan has been deducted from the register under section 20, the Labuan Foundation shall, within three years immediately after the date of the deletion, apply to the Board such that the name Labuan Foundation is placed back into the register.

(2) on payment of the prescribed fee to the Board including any other fees stipulated to be payable, the Board may restore the name Labuan Foundation into the register.

(3) upon the Foundation of the name Labuan to the register under subsection (2), the name of the Labuan Foundation shall be deemed to have never been cut from the register.


Labuan re-Pendomisilan 23. (1) a Foundation is established under the laws of the State or other jurisdiction may, subject to subsection (2), and if such is permitted by the laws of the country or jurisdiction, the domiciled in Labuan and is registered by the Foundation includes just-established under this Act.

(2) a foundation established under the laws of the State or other jurisdiction that meets the requirements of this Act shall be domiciled in Labuan again — (a) by submitting to the Board — (i) an application in writing duly signed by all officers, or equivalent, the Foundation, apply 26 laws of Malaysia ACT 706 so that the Board of the Foundation registered under this Act;

(ii) a statement containing the particulars required under the first schedule; and (iii) a statutory declaration by the Secretary or any officer or equivalent, of compliance with all relevant requirements of this Act; and (b) on payment of the prescribed fee.

(3) the Board may, upon receipt of the documents and payment of the fee under subsection (2), issue a certificate of registration.

(4) when the certificate of registration issued by the Board under subsection (3) — (a) the Foundation is able to exercise all the powers of a Labuan Foundation registered under this Act and will no longer be treated as a foundation registered under the laws of the country that is the Foundation of it didomisilkan again;

(b) all property and other assets, including the rights of the Foundation in action, shall continue to be vested in the Foundation;

(c) the Foundation shall remain liable for all claims, debts, liabilities and obligations existing prior to its registration under this Act;

(d) no conviction, judgment, order, orders, claims, debts, liabilities or obligations that become due or outstanding and no cause of action in place, against the Foundation or to any Council Member, officer or agent of the Foundation, may 27 released Foundation Labuan or become defective as a result of its registration under this Act; dan (e) tiada prosiding, sama ada sivil atau jenayah, yang belum selesai oleh atau terhadap yayasan itu atau terhadap mana-mana anggota majlis, pegawai atau ejen yayasan itu, boleh digugurkan atau diberhentikan oleh sebab pendaftarannya di bawah Akta ini, dan prosiding itu boleh diteruskan, dikuatkuasakan, didakwa, diselesaikan atau dikompromi oleh atau terhadap yayasan itu atau terhadap anggota majlis, pegawai atau ejen yayasan itu , mengikut mana-mana yang berkenaan.


Pendomisilan semula di negara lain 24. (1) Sesuatu yayasan Labuan yang didaftarkan di bawah Akta ini boleh, tertakluk kepada apa-apa had dalam dokumen konstituennya, berdomisil semula dan didaftarkan di bawah undang- undang negara lain itu mengikut cara yang diperuntukkan di bawah undang-undang itu.

(2) a Labuan Foundation registered under this Act that are domiciled and registered under the laws of other countries, does not cease to be a Labuan Foundation registered under this Act unless the laws of other countries that allow pendomisilan and the registration and the Labuan Foundation complies with the law.

(3) where a Labuan Foundation registered under this Act domiciled and registered under the laws of other countries — (a) the Foundation shall continue to Labuan liable for all claims, debts, liabilities and obligations that existed before its registration under the laws of the other country;

(b) no conviction, judgment, order, orders, claims, debts, liabilities or obligations outstanding or 28 laws of Malaysia ACT 706 be in arrears, and no cause of action against the existing foundation of the Labuan or against any Council Member, officer or agent of the Foundation the Labuan, be released or become defective as a result of its registration under the laws of the other country;
and (c) no proceedings, whether civil or criminal, pending by or against the Foundation of the Labuan or against any Council Member, officer or agent of the Foundation the Labuan, can be omitted or terminated by virtue of its registration as a foundation under the laws of other countries, and the proceedings can continue, enforced, prosecuted, settled or compromised by or against a councilman, officer or agent of the Foundation the Labuan , as the case may be.

(4) where a Labuan Foundation registered under this Act have been domiciled and registered under the laws of other countries, the Labuan Foundation shall submit to the Board a copy of which has been endorsed, and if applicable, a copy of the registration certificate apostil issued by the Registrar or competent authorities in other countries and upon the receipt of a copy of the certificate of registration of such that , The Board shall deduct the Labuan Foundation of express and recommend that the Foundation of Labuan had cease to be a foundation registered under this Act.


Part V COUNCIL, officers and Council Appointments Council SECRETARY

25. (1) The Charter of a Labuan Foundation can provide for the appointment of a Council which shall consist of a Foundation Labuan 29 members or more that may be a normal person or body corporate.

(2) prior to registration of the Foundation of Labuan, Council Member may be appointed by the founders.

(3) upon the Foundation of Labuan registered, Council Member may be appointed by the founders or any other person authorized by the founders of the Charter or articles of Labuan Foundation.

(4) a founder or a beneficiary who is not an officer of Labuan Foundation be appointed as a member of the Council.

(5) the appointment of a member of Council of a Labuan Foundation will not be effective unless he submits to the founders or the person who appointed him, as the case may be, consent in writing to the appointment.


Council meeting 26. The Fifth Schedule shall apply to meetings of the Council.


Kehilangan kelayakan anggota majlis 27. A person cannot be appointed or continue to remain as a member of Council if — (a) he is a bankrupt, suffering from mental disorder or insane;

(b) that person, which is a body corporate, be a matter of any proceedings that may result in it wound up or otherwise dissolved;

(c) the person has been convicted of a criminal offence involving fraud and dishonesty or any 30 laws of Malaysia ACT 706 criminal offences for which he was punished by imprisonment; or (d) he yayasan Labuan accordingly.


Termination of Councilman 28. Members of the Council who wish to stop acting in the property shall give at least thirty days prior notice in writing of his intention to the Labuan Foundation not later than seven days before the member intends to quit acting in it.


The appointment of the person who oversees the 29. (1) if the provisions of the constituent documents provide for the appointment of persons to supervise, the provisions of sections 25, 26, 27 and 28 shall apply mutatis mutandis, subject to the constituent documents, to the appointment and those who oversee it.

(2) Jika sesuatu yayasan Labuan mempunyai orang yang menyelia sebagai ganti atau tambahan kepada anggota majlis, semua sebutan dalam Akta ini mengenai majlis dan anggota majlis hendaklah ditafsirkan termasuk orang yang menyelia itu.


Appointment of members of the Council by the Court 30. If at any time there are members of the Council are appointed for a foundation Labuan or the number of appointed members is less than that required by this Act or Charter, application may be made to the Court by the founder, Councilman or those who supervise others, or officer, for appointment by the Court one or more to be a Council Member for the purpose of complying with the requirements of the Charter and the provisions of this Act.

Labuan Foundation 31 Council 31. (1) the constituent Documents can define the powers of the Council and provide for extra power to power provided under this Act.

(2) the Council shall — (a) take any action that it considers necessary to ensure compliance with the terms of the constituent documents and the provisions of this Act by the Labuan Foundation and its officers; and (b) is responsible for the general supervision of the Foundation of the management of Labuan by his officers.

(3) the Council shall represent the Foundation of Labuan and for the purpose of ensuring compliance with the terms of the constituent documents and the provisions of this Act, the officers of the Foundation shall act according to the Labuan Command Council.


Rights Council 32. (1) in addition to the Rights Council provided in document constituents and in the other provisions of this Act, the Council shall have the following rights: (a) to be notified of all meetings of the officers;

(b) to attend and be heard in person but not to vote at the meeting of the officers;

(c) if any business of a Labuan Foundation carried out through the distribution of documents, to be distributed to him also the document at the time the document was distributed to all officers;
32 laws of Malaysia ACT 706 (d) if any business of a Labuan Foundation carried out through the delegation of authority to an officer, to be notified of the terms and any exercise of the delegated authority.

(2) the Council shall have access to the books, records, accounts and vouchers of Labuan Foundation.


The duty of the Council 33. (1) a member of Council shall use reasonable skill and care in discharging its duties and exercising rights and powers.

(2) in the absence of any officer of Labuan Foundation, the Council shall perform the duties and exercise the powers of officers prescribed in this Act.


A reference to the Council apply to Councilman acting you jointly and severally 34. A reference to the Council shall apply to Councilman acting you jointly and separately.


Officer Appointments officer 35. (1) the founders shall, before the Foundation of the proposed register of Labuan, appoint at least one officer of the Labuan Foundation subject to such terms and conditions as may be deemed fit by the founder.

(2) the officer can be an ordinary or a body corporate.

Labuan Foundation 33 (3) of the founders or beneficiary who is not a member of the Council may be appointed as an officer of the Labuan Foundation.

(4) the appointment of an officer of a Labuan Foundation will not be effective unless he had given to the founder of consent in writing on the appointment.


36 officers meeting. The Fifth Schedule shall apply to an officer of the Foundation meeting of Labuan.


Loss of eligibility officer 37. (1) a person shall not be appointed or continue as an officer of a Labuan Foundation if — (a) he is a bankrupt, suffering from mental disorder or insane;

(b) that person, which is a body corporate, is a matter of any proceedings that may result in it wound up or otherwise dissolved;

(c) the person has been convicted of a criminal offence involving fraud and dishonesty or any criminal offence for which he has been sentenced to imprisonment;

(d) he is a councilman; or (e) the person is the person that has to do with the councilman.

(2) Bagi maksud perenggan (1)(e), orang itu hendaklah disifatkan mempunyai kaitan dengan seorang anggota majlis jika dia— 34 Undang-Undang Malaysia AKTA 706



(a) is a member of the Council of members of the family, including the spouse, parent, son including adopted children or stepchildren, brother, sister, and spouse of her child, her brother or sister; or (b) a body corporate that has to do with the Council members.

(3) Bagi maksud perenggan (2)(b), suatu pertubuhan perbadanan mempunyai kaitan dengan seorang anggota majlis jika— (a) pertubuhan perbadanan itu pada lazimnya, atau mempunyai obligasi, sama ada secara formal atau tidak formal, atau pengarah-pengarahnya pada lazimnya, bertindak mengikut arahan, petunjuk atau kehendak anggota majlis itu; or (b) a member of the Council has control of interest in the body corporate.

(4) an officer of a Labuan Foundation shall, if he is disqualified under this section, notice in writing of dismissal to Labuan and Foundation Board within seven days after he was disqualified.

(5) the Board may issue instructions so that a person residing in any of the circumstances under subsection (1) is not eligible to act as an officer of Labuan Foundation.


The duty officer 38. (1) an officer of a foundation of Labuan shall take all steps and do or cause to be done all things necessary to administer properly the Labuan Foundation to accomplish the purpose or goal of the Labuan Foundation.

Labuan Foundation 35 (2) an Officer shall use care Foundation Labuan and reasonable skill in the conduct of the Affairs of the Foundation the Labuan, including using reasonable care and skill in the management and investment of the assets of the Foundation of Labuan.

(3) an Officer of Labuan Foundation shall act in accordance with the constituent documents of Labuan and Foundation of this Act.

(4) in the case of the Council or the person overseeing is not appointed, the yayasan Labuan acting in association shall be the body that manages the Foundation's governance and Labuan, in the face of a third party, such act shall be a officer representing the Labuan Foundation.

(5) unless the constituent documents of a Labuan Foundation allocated otherwise and subject to the provisions of this Act, the officer shall act Foundation Labuan unanimously and such can act through the distribution of a written document signed by reasonable per the officer.


Pemberhentian pegawai 39. An officer of a Labuan Foundation that intends to cease acting as an officer shall give at least thirty days prior notice in writing of his intention to the Labuan Foundation and submit to the Board a declaration of their intention to it.


Remuneration of officers 40. (1) unless the Charter provides for otherwise, yayasan Labuan shall be paid remuneration in accordance with the obligations required to be undertaken by them and taking into account the financial position of the Foundation of Labuan.
36 laws of Malaysia ACT 706 (2) any dispute concerning the amount of remuneration of an officer a Labuan Foundation may be referred by officers, or an officer, or the Council, or approved Auditors, to the Court, which shall determine the remuneration.

Secretary the Secretary 41. (1) the founders shall, before registering a foundation of Labuan, appoint a person, who shall be a company registered as a Labuan trust company under part V of the Financial Services Act and Labuan Securities 2010 [Act 704], to be the Secretary for Labuan Foundation proposed that.

(2) the Secretary may be a Council member at the same time provided that the Secretary is not a single member of the Council.

(3) the Secretary shall have the duties, powers and obligations provided for in this Act including receiving service of all documents in respect of legal proceedings against the Foundation's Labuan Labuan is passed on to the Foundation.


Pemberhentian setiausaha 42. If the Secretary intends to cease acting as Secretary to the Foundation of Labuan, he shall give at least thirty days prior notice in writing of his intention to the Labuan Foundation and submit to the Board a declaration of their intention to it.

Documents shall be filed through the Secretary of 43. (1) every document or instrument required or permitted to be filed with or submitted to the Board at the Labuan Foundation Act 37 shall be filed or submitted through the Secretary of a Labuan Foundation.

(2) every application to the Board for such certification or for any draw or copy of any certificate issued under this Act or of any document filed with or submitted to the Board shall be made by the Secretary of a Labuan Foundation.

(3) the Secretary of a Labuan should ensure the validity of the Foundation, the truth and the authenticity of any instrument or document with difailkannya or diserahkannya to the Board on behalf of a foundation of Labuan.

(4) subsection (2) shall not apply where an application is made in respect of an Foundation of Labuan by any of the founders, officers, Council member or beneficiary of the Foundation of the Labuan and documents, certificates, extracts or copies of that is for the use of devices.


Registered office the registered office 44. (1) a Foundation shall have a registered office in Labuan Labuan who shall be the address of the Secretary for the Foundation of the Labuan, which to him all communications, correspondence and letter-notice can be addressed.

(2) notice of any change of address of the registered office shall be given in accordance with subsection 17 (1).

(3) Apa-apa proses atau dokumen yang dikehendaki untuk disampaikan kepada sesuatu yayasan Labuan adalah disampaikan dengan sempurna jika dialamatkan kepada yayasan Labuan itu dengan meninggalkannya di, atau menghantarnya melalui pos kepada, pejabat berdaftar yayasan Labuan itu di Labuan.

38 the laws of Malaysia ACT 706 (4) Process or document required to be served to a foundation Labuan is delivered perfectly to the Labuan Foundation with leaving it at, or sending it by post to, any place of business established by the Labuan Labuan Foundation — (a) if the default Foundation Labuan filed with the Board, the name and address of the registered office as may be allowed to accept on behalf of the Presentation Foundation Labuan any process or document;


(b) if at any time the registered office notified such does not yet exist; or (c) If for any other reason the delivery process or document registered office cannot be performed.


Documents shall be kept at the registered office 45. (1) every Labuan Foundation shall cause the registered office are stored in faxed documents konstituennya and all documents and instruments filed with or submitted to the Board and the books containing the minutes of meetings of the Council and officers.

(2) Melainkan jika Lembaga membenarkan selainnya, semua salinan pendua buku minit suatu yayasan Labuan boleh disimpan di tempat lain dan bagi maksud pemeriksaan di bawah seksyen 48 hendaklah disifatkan disimpan di pejabat berdaftar yayasan Labuan itu.


Labuan Foundation records form 46. Records required to be kept by a Labuan Foundation by this Act may be kept in the form of photographs or can be recorded or recorded by mechanical data processing system or electronic or any storage devices Foundation Labuan 39 other information that able to reproduce any information required in the form of writing can be understood within a reasonable time.


Translation of documents and the instrument 47. (1) where any document or instrument which is required to be filed with or submitted to the Board is in a language other than the national language or English, instrument or document shall be accompanied by a verified or certified translation either in the national language or in English.

(2) if any account or other record required to be kept and maintained under this Act has not been saved in the national language or in English, a translation certified accounts and records shall be kept with the correct result and the original account record.


Inspection and production of documents stored by yayasan Labuan 48. (1) documents required to be kept by a foundation of Labuan under this Act shall, during the time, available for inspection by the founder, councilman, those who supervise or officer, as the case may be, the Labuan Foundation without any costs.

(2) any person, other than the members of the Council, those who supervise or an officer of Labuan, the Foundation reserves the right to inspect the books of minutes of meetings of members of the Council shall, within seven days after he made a request to the Labuan Foundation, provided with a copy of any minutes without any payment.

(3) if there is a failure to comply with subsection (1) or any request for any inspection under this section 40 laws of Malaysia ACT 706 rejected, Labuan Foundation is guilty of an offence and shall, on conviction, to a fine not exceeding ten thousand ringgit.

(4) Dalam hal kesalahan yang berterusan bagi kesalahan yang dilakukan di bawah subseksyen (3), sebagai tambahan kepada penalti di bawah subseksyen (3), yayasan Labuan itu boleh didenda tidak melebihi seribu ringgit bagi setiap hari atau sebahagian hari kesalahan itu berterusan selepas sabitan.

(5) in the case of refusal referred to in subsection (4), the Court may, by order, forcing to allow immediate inspections of the document.


Inspection and production of documents kept by the Board of 49. (1) any person may, if so permitted by the Foundation of Labuan and on payment of the fee prescribed — (a) inspect any of the documents submitted, registered by or filed with the Board under this Act and kept by the Board and, if it thinks fit by the Board, a copy of the document konstituennya;

(b) require the conferred upon him a copy of the certificate of registration of the Labuan Foundation or any other document or part of any other document referred to in paragraph (a) which has been endorsed as valid.

(2) a copy of a valid certificate or endorsed granted under paragraph (1) (b) shall be signed by the Board and sealed with the seal.



Labuan Foundation 41 PART VI the ABILITY FOUNDATION LABUAN capabilities and power 50. (1) a registered yayasan Labuan accordingly under this Act is a body corporate who can sue and be sued in the name of him.

(2) subject to this Act and the provisions of document konstituennya, a foundation of Labuan has a capacity, rights, powers and privileges individuals.

(3) Piagam sesuatu yayasan Labuan boleh mengandungi peruntukan yang menyekat keupayaan, hak, kuasa dan keistimewaannya.

(4) Notwithstanding subsection (3), the validity of an act done by a foundation of Labuan shall not be questioned on the ground of absence of capacity caused by anything contained in piagamnya.


Confirmation of acts done beyond the ability of 51. (1) a Council member or beneficiary of a foundation of Labuan, can bring proceedings to prevent the doing of any act which if not because section 50 is beyond the ability of Labuan Foundation, except there are no such proceedings may be brought in respect of an act done in fulfilment of the legal obligations arising from the Act of earlier Foundation the Labuan.

(2) be the duty officer a Labuan Foundation to comply with any limitation on the authority of the constituent documents and the consequence of any act by the officers that go beyond the powers allocated such 42 laws of Malaysia ACT 706 be verified only through confirmation of the performed Foundation Labuan by the following ways: (a) if the Council or those who supervise others , with the unanimous resolution of the Council and those who supervise other; and (b) if there is no Council or person to supervise, with a resolution signed by all officers Labuan Foundation at that time.

(3) a resolution confirming acts of councilman, the person supervising and the officer in charge beyond the ability Foundation Labuan is not prejudice to any liability incurred by the officer or any other person and relief from any such liability shall be agreed separately with the resolution of the Council and those who oversee it.


Of any officer shall be binding on Labuan 52 Foundation. (1) a party in a transaction with a foundation of Labuan is not bound to examine whether the transaction is a transaction that is authorized by the constituent documents of the Foundation of Labuan

that or about any limits the power of the Council or officers to tie the Labuan or Foundation to give others the power to do so.

(2) subsection (1) without prejudice to any right of any Council, Councilman or supervise, or officer of a Labuan Foundation, as the case may be, to take proceedings to prevent the Commission of an act that goes beyond the powers of the officer.

(3) subsection (1) without prejudice to any liability incurred by the officer in charge of a Labuan Foundation or any other person, by reason of the conduct of the officer that is beyond their power.
Labuan Foundation completion of contract, documents 43 by yayasan Labuan 53. (1) a foundation can execute Labuan any contract, deed, instrument or other document with, if the Foundation has the seal, the seal remains in front and witnessed by a member of the Council or those who supervise, or officer or other duly authorised signatory by yayasan Labuan, or if authorized by the constituent documents, signed by a duly authorized signatory of it.

(2) any contract made according to this section has the effect in law, and shall be binding on a foundation of Labuan and all other parties to the contract and may be varied or revoked by the way the contracts are made.

(3) a document or proceeding requiring authentication by a Labuan Foundation can be signed by an authorized officer of Labuan and the Foundation need not be signed under seal.

(4) a Labuan Foundation may, in writing — (a) if it has the seal of the Foundation of Labuan, under the seal of that; or (b) by signed by authorized signatories Labuan Foundation that, with each person signing on or under the seal of the signatories, as the case may be, gives any person the authority either generally or in respect of any specific matters as an agent or his representative to complete the deed, instrument or other document on his behalf and any deed, instrument or other document signed by the agent or representative on behalf of the Foundation of Labuan under seal or by penandatangan diberi kuasa ejen atau wakil itu, hendaklah mengikat yayasan Labuan itu;
and all those who deal in good faith is entitled to 44 laws of Malaysia ACT 706 considers appropriate and proper execution of the deed, instrument or other document, and to act accordingly.


Disclosure of interest 54. (1) every Member of the Council, those who supervise and officer of a foundation off in any way, whether directly or indirectly, has an interest in a contract or proposed contract with the Foundation of Labuan shall, as soon as practicable after the relevant facts come to his knowledge of — (a) in relation to a councilman and those who supervise — (i) to declare the type of stake in the meetings of the Council; or (ii) cause circulated in writing to all members of the Council that other details of the stake; and (b) in relation to an officer — (i) to declare the type of stake officers meeting; or (ii) cause circulated in writing to all other officials details of the stake.

(2) subsection (1) shall not apply in case of interest a councilman, those who supervise or officer of a Labuan Foundation just because the officer to be a member or creditor of a corporation or other firms interested in the contract or proposed contract with the Foundation of Labuan Labuan Foundation that, if it can be with 45 interest should be considered as non-material interests.

(3) the Declaration of interest by a member of the Council, those who supervise or officer shall be made at the time of the following — (a) in the case of a proposed contract — (i) the Declaration shall be made at the meetings of the Council or of an officer, as the case may be, at which a proposed contract is first considered; atau (ii) pengisytiharan itu hendaklah dibuat di mesyuarat majlis atau mesyuarat pegawai yang berikutnya, mengikut mana-mana yang berkenaan, yang diadakan selepas dia menjadi anggota majlis, orang yang menyelia atau pegawai menjadi berkepentingan sedemikian; and (b) in the case of an existing contract, the Declaration shall be made at the meetings of the Council or of the officer first, as the case may be, held after councilman, spend supervising or officer to be interested in such.

(4) for the purposes of subsection (1), a general notice is deemed to have been given by members of the Council, those who supervise or officer to Councilman or other officers, as the case may be, the Foundation of Labuan stakeholders that — (a) when the notice is given at the meeting of the Council or of an officer, as the case may be; or 46 laws of Malaysia ACT 706 (b) when the councilman, those who supervise or take reasonable steps to ensure that the matter is raised and read at the meeting of the Council or meeting the following officers, as the case may be.

(5) every Member of the Council, those who supervise or something off Foundation holds any Office or have any property for it, either directly or indirectly, obligation or interest will exist which is inconsistent with the duty or interest as a councilman, those who supervise or yayasan Labuan that, to declare at the meeting of the Council or of the Labuan Foundation officer or cause to be distributed in writing to the members of the Council or other officer of the fact and the nature of , the nature and extent of the conflict.

(6) no anything in this section can be considered as affect the effect of any provision in the constituent documents of a foundation off block councilman, those who supervise or an officer of Labuan Foundation has any interest in any contract with the Foundation of the Labuan.


The liability of the members of the Council, those who supervise, 55 officers and Secretary. (1) no member of Council, those who supervise, officer or Secretary of a Labuan Foundation responsible for personally

for any liability of a foundation of Labuan unless the liability it was committed as a result of gross negligence, default or deliberate misconduct, fraud or dishonesty councilman, those who supervise, officer or the Secretary.

(2) subject to section 56, any of the provisions contained in the constituent documents or in any contract with the Foundation of the Labuan or otherwise, which exclude any member of the Council, those who supervise, Labuan 47 Foundation officer or Secretary of the Labuan or bear Foundation ruginya against, any liability by virtue of any of the five pillars of the law will be, if not for that, relating thereto in respect of any negligence , default, misconduct or breach of duty which he liable to him in relation to the Labuan, Foundation is terminated.


The Court may give relief is 56. (1) Notwithstanding anything contained in section 55, a foundation of Labuan may, in any such provision referred to in subsection 53 (2), indemnify any member of the Council, those who supervise, such officer or Secretary against any liability incurred by him in making a defence in any proceedings, whether civil or criminal, in which judgment that favor given or in which he is acquitted or in connection with any application under subsection (2) , (3) and (4) the relief granted by the Court.

(2) Jika, dalam apa-apa prosiding bagi kecuaian, keingkaran, salah laku, peninggalan atau pelanggaran kewajipan terhadap seseorang anggota majlis, orang yang menyelia, pegawai atau setiausaha sesuatu yayasan Labuan, didapati oleh Mahkamah bahawa orang itu bertanggungan atau mungkin bertanggungan berkenaan dengan kecuaian, keingkaran, salah laku, peninggalan atau pelanggaran kewajipan, tetapi dia telah bertindak dengan jujur dan munasabah dan menjalankan usaha yang wajar, dan bahawa , having regard to all the circumstances of the case, including those related to his appointment, he should be forgiven for fairly negligence, default, misconduct or breach of the obligation, omission, the Court can release it, whether wholly or partly, from its liability on such terms as the Court may think fit.

(3) If a member of the Council, those who supervise, officer or Secretary of a Labuan Foundation has reason to mengkhuatiri that any claim will or might be 48 laws of Malaysia ACT 706 against him in respect of any negligence, default, misconduct or breach of duty of the omission, he may apply to the Court to obtain relief, and the Court shall, upon any such application, have the power to give him relief in respect of negligence , default, misconduct or breach of the obligation, and legacy.

(4) where any case to which subsection (2) applies is tried by a judge, the judge after hearing the evidence, may, if he is satisfied that a councilman, those who supervise, officer or the Secretary in accordance with that subsection should be discharged either wholly or partially from liability to be enforced against him, rejecting the case wholly or partly and immediately ordered a judgment in favour of him made on such terms of costs or otherwise as the judge thinks fit.


Money or other property from illegal activities Law 57. (1) a foundation Labuan can't receive — (a) any money or other property arising from a transaction, operations or other activities which is a criminal offence under the laws of Malaysia or, if carried out in Malaysia, would be such offences; or (b) any money or other property which the receipt, ownership or control is or will become an offence as is mentioned in paragraph (a).

(2) it shall be the duty of the members of the Council, those who supervise, officer or Secretary of a Labuan Foundation to bring immediately to the knowledge of the Board if he — Labuan Foundation 49 (a) has reason to believe that the Foundation of the Labuan has property or income that accrued to it or obtained by it and arising from a transaction, operations or other activities that constitute a criminal offence under the laws of Malaysia or If carried out in Malaysia, would be such offences; or (b) has received or has in the possession or control of money or other property which the receipt, ownership or control is or will become an offence as is mentioned in paragraph (a).

(3) any member of the Council, those who supervise, officer or Secretary of a foundation off without reasonable excuse fails to comply with the requirements of subsection (1) or fails to comply with the requirements of subsection (2) commits an offence and shall, on conviction liable to a fine not exceeding three million ringgit or to imprisonment for a term not exceeding five years or both.

(4) all the money or property described in subsection (1) and (2) shall be forfeited to the Government and become his property as a whole.


Disposal of fraudulently 58. (1) if it is proved that a Labuan Foundation established or registered in Labuan, or property disposed of to the Labuan Foundation — (a) established or registered or disposed of as such by or on behalf of the founders with the main intention to memfraud the founder of the creditor; and (b) was, at the time of incorporation or registration or the disposal occurs, making the founder not 50 laws of Malaysia ACT 706 solvent or without the property with it claim the creditor that, if successful, will be resolved, then the creation, registration or the disposal shall not be valid or may cancel and Labuan Foundation that is liable to settle claims that the extent of the creditor's interest in the founders of the property prior to the establishment of , registration or disposal, and any increase in the property, if any, after that.

(2) for the purposes of subsection (1), in determining whether a Labuan Foundation established or registered or a disposal has made founder of the insolvent or without the property with it claim the creditor that, if successful, could be settled, shall be taken into account in market value

affordable for the founder of the property at the time immediately after the creation, registration or the disposal.

(3) if the fair market value of property referred to in subsection (2) exceeds the value of the creditor's claim, at the time after creation, registration or disposal of that, then the Foundation of Labuan established or registered as such or such disposal shall be for the purposes of this Act be deemed to be not established or registered, or the property is not disposed of, with the main intention to memfraud the creditor.

(4) a Labuan Foundation established or registered in Labuan and a disposition of property to the Foundation of Labuan is not be fraud against someone the creditor a person the founder of — (a) if the establishment or registration, or the disposal, occurs before the creditor action against the founder of the cause that accrued or incurred;

(b) if the establishment or registration, or the disposal, occurs after the expiry of two years from the date the cause of action accrued Payables; or Foundation Labuan 51 (c) if the establishment or registration, or the disposal, occurs before the expiration of two years from the date the cause of action accrued Payables and Payables that doesn't start the action before the expiry of one year from the date of incorporation or registration, or the disposal.

(5) a founder cannot be linked with an intention to memfraud someone creditor solely by reason of — (a) the founders have set up or register a foundation Labuan or disposed of the property to the Labuan Foundation within two years from the date the cause of action accrued Payables; atau (b) pengasas itu ialah seorang benefisiari.

(6) where a Labuan Foundation be liable to settle claims of creditors in the manner provided in subsection (1) but was unable to do so due to the fact that the property has been disposed of, in addition to a bona fide buyer with value, then any such disposal shall be invalid.

(7) for the purposes of this section, the date of the cause of action accrued is — (a) the date of the Act or omission that can be used to prove the cause of action, whether in part or in whole; and if there is more than one act or if the omission was omission continues, the date of the first act or the date the omission occurred, as the case may be; and (b) in the case of an action upon a judgment, the date of the Act or omission, or if there is more than one act or the omission was omission continues, the date of the Act which 52 laws of Malaysia ACT 706 first or the date of the relics took place, as the case may be, that give rise to the judgment.

(8) in this section, the term "creditor" includes any person who makes a statement of the existence of a cause of action.


Accounts shall be kept 59. (1) a foundation of Labuan shall cause kept the accounting and other records that are supposed to be explained adequately transactions and financial position of the Foundation the Labuan.

(2) every Foundation yayasan Labuan Labuan and shall cause the appropriate entries to be made in the accounting and other records and the Labuan Foundation within sixty days of completion of the transaction in respect of which the record relates.

(3) the accounting and other records and a foundation of Labuan shall be kept at the registered office of the Foundation the Labuan or at any other place in Labuan as an officer thinks fit and shall at all times be available for inspection by members of the Council, those who supervise, officer, and Auditors approved, if an auditor appointed.

(4) Seseorang pegawai yayasan Labuan yang tidak mengambil segala langkah yang munasabah untuk memastikan pematuhan oleh yayasan Labuan itu akan kehendak seksyen ini, atau disebabkan perbuatan ingkarnya sendiri menyebabkan apa-apa keingkaran oleh yayasan Labuan itu di bawah seksyen ini, adalah melakukan suatu kesalahan dan boleh, apabila disabitkan didenda tidak melebihi sepuluh ribu ringgit atau dipenjarakan bagi suatu tempoh tidak melebihi enam bulan atau kedua-duanya.

(5) any founder, councilman, those who supervise, officials and the Secretary of a Labuan Foundation reserves the right to be given, in Labuan 53 Foundation period of seven days after he made a request to the Foundation, a copy of the statement of the Labuan financial accounts and records and audit reports approved, if any, without payment and if there is a default in giving such copies, the Labuan Foundation and every officer is deemed to be guilty of an offence and can be , on conviction liable to a fine not exceeding ten thousand ringgit or to imprisonment for a term not exceeding six months or to both.


Labuan 60 Foundation audit. (1) where, on application to the Court by the founder, councilman, those who supervise, officer, Secretary or beneficiary, the Court is satisfied that there is prima facie evidence of failure to comply with document constituent or requirement of this Act in the course of a Labuan Foundation, the Court may order that appointed an auditor approved to carry out audits of the Labuan Foundation.

(2) the appointment of an auditor approved under subsection (1) may be made subject to conditions given by the applicant to the Court an amount, to be determined by the Court, as a guarantee, for the cost of carrying out the audit.

(3) the approved Auditor appointed under this section shall submit its report to the Court within such period of time as may be determined by the Court.

(4) the Court shall make such order regarding costs as it thinks fit, having regard to whether or not the application has a solid foundation, and if the application does not have a solid foundation, the Court may order any losses or costs caused to the audit Foundation with the Labuan paid by the applicants.


54 laws of Malaysia ACT 706 cannot place claims or judgments abroad 61. (1) Semua persoalan yang berbangkit berkenaan dengan sesuatu yayasan Labuan yang ditubuhkan dan wujud di bawah Akta ini atau berkenaan dengan apa-apa pelupusan harta kepadanya hendaklah ditentukan mengikut Akta ini, tanpa merujuk kepada undang-undang mana-mana bidang kuasa lain yang dengannya

Labuan Foundation or the disposal of the related, including questions of — (a) the ability of its founders;

(b) any other aspects of the validity of the Labuan Foundation or disposal or the interpretation or effect of the Labuan Foundation;

(c) administration of the Labuan Foundation, whether management is carried out in Labuan or elsewhere, including questions of power, obligations, liabilities and rights administrative body that manages or supervises the Labuan Foundation and the appointment and removal of them; and (d) the availability of power and extent of power, provided or maintained by the founders, including the power to vary or revoke the Charter for the Foundation of Labuan and validity of any exercise of that power.

(2) where a foundation established by valid according to Labuan document konstituennya or as otherwise provided by this Act, the Court may not change or waiver or recognise the validity of any claims against the estate of the Labuan Foundation in accordance with the laws of another jurisdiction or court order of a another jurisdiction in respect of the following: (a) as a result of self and property of a marriage or termination of the marriage;
Labuan Foundation 55 (b) the right of inheritance, either by Testament or not, including a regular part of the husband or wife or relatives;

(c) any claim or court order relating to the matters referred to in paragraph (a) or (b) in respect of legal yourself founder or beneficiary; and (d) the creditor's claim in the case of insolvency, subject to the provisions of this section.


PART VII BENEFICIARY Rights beneficiary for information related to its stake in 62. (1) Seseorang benefisiari yang mempunyai kepentingan yang terletak hak dalam harta sesuatu yayasan Labuan adalah mempunyai hak untuk meminta daripada anggota majlis, orang yang menyelia atau pegawai yayasan Labuan itu maklumat dan dokumen berkaitan dengan kepentingannya dan secara khusus berhak— (a) untuk menerima, atas permintaan, maklumat daripada yayasan Labuan itu berkenaan dengan pencapaian maksud dan matlamat yayasan itu;

(b) upon request, to examine and given a copy of — (i) the Foundation Charter of Labuan and any amendment made to the Charter;

(ii) article the Labuan Foundation and any amendment made to the article;

56 laws of Malaysia ACT 706 (iii) any audit reports, including any special audit reports, books of account, reports on the financial position of the Foundation and its annual accounts in Labuan.

(2) Request to receive information or examine the document referred to in subsection (1) shall be made in writing.

(3) the information and documents referred to in subsection (1) includes — (a) all documents relating to interests vested in the beneficiary in which the terms of Labuan Foundation or any exercise of the power or discretion is possible; and (b) all financial statements of Foundation the Labuan as it relates to the interests of the beneficiary.


Rights of beneficiaries for confidentiality 63. (1) when disclose any information or document to any beneficiary, councilman, those who supervise or yayasan Labuan shall be — (a) If a beneficiary to another calling for confidentiality is preserved; atau (b) jika anggota majlis, orang yang menyelia atau pegawai itu mengikut budi bicara mutlak mereka memutuskan bahawa kerahsiaan merupakan yang terbaik bagi kepentingan benefisiari yang lain itu, mengambil segala langkah yang munasabah untuk memelihara hak kerahsiaan benefisiari yang lain itu dengan memberi benefisiari itu sahaja dokumen atau maklumat yang membolehkan hak dan Yayasan Labuan 57 kepentingan atau faedah benefisiari itu di bawah yayasan Labuan itu ditentukan.

(2) the information and documents that may include a copy or extract of the constituent documents or other documents certified and copy advice or statements from whom the name and interests of other beneficiary has been edited or cut to preserve the confidentiality of which is the right of the beneficiary to another.


The Court may order the information given to beneficiary 64. (1) If a foundation of Labuan does not meet the request for information under section 62 or does not provide document can for the inspection in accordance with section 62 and 63 in a reasonable time, the Court may, on application, order the beneficiary — (a) that provided the information requested; and (b) the examination of the document, if appropriate, by the person who has professional qualifications to assess the information contained in the document and report to the beneficiary who made the application to the Court.

(2) any member of the Council, those who supervise or officer of a foundation off did not take all reasonable steps to ensure compliance by the Labuan are requirements of the Foundation of this section, or by acts of sengajanya resulted in non-compliance, also in itself responsible for the breach and shall be dikomitkan to such order as it thinks fit by the Court.



58 laws of Malaysia ACT 706 Division of property to beneficiaries 65. (1) except if otherwise allocate constituent document, no distribution to the beneficiary can be made by valid unless signed by all officers appointed.

(2) an Officer of Labuan Foundation can only provide power distribution to the beneficiary in accordance with this Act and the constituent documents of the Foundation of Labuan.

(3) no distribution to the beneficiary can be made for the purpose of mess up, or if the effect of doing so will mess up, claims of any creditor of the Labuan Foundation.


Pewakilan kuasa untuk memberi kuasa pembahagian kepada benefisiari oleh pegawai 66. (1) except if otherwise allocate constituent documents — (a) an officer acting unanimously may delegate to one of them through the document signed by each of them, the officer's power to authorize the distribution to the beneficiary; and (b) such delegated powers under paragraph (a) shall be conducted as provided in document representation that power.

(2) subsection (1) shall apply to the officer to whom authority has been delegated for the exercise of that power as if sound in that subsection about the officer carrying out the delegated authority is the pronunciation for the officer acting in association.




Yayasan Labuan 59 BAHAGIAN VIII PEMBUBARAN Pembubaran 67. (1) a foundation of Labuan shall be terbubar in the event of the following matters and when officials approve a resolution that affects so: (a) the established Foundation of Labuan for certain period of time and the time frame has expired;

(b) the purpose of the foundation that has been reached or Labuan is already unable to be achieved; or (c) any provision of the Charter that require such Foundation of Labuan.

(2) where it is proposed to the dissolution of a foundation of Labuan pursuant to the provisions of subsection (1), an officer, or any other person authorized by the Charter for the Foundation to oversee the dissolution of Labuan Foundation Labuan shall make a declaration which means that they have investigated the State of affairs of the Labuan Foundation and the view that the Foundation will be able to pay the Labuan in full its debts when dissolved.

(3) such a declaration made under subsection (2) shall not have effect unless it is made within the period of thirty days immediately before passed a resolution under subsection (1).

(4) the officer shall cause to be submitted to the Board a declaration made pursuant to subsection (2), together with a copy of the ruling made pursuant to subsection (1) within thirty days from the approval of the resolution.

60 laws of Malaysia ACT 706 (5) unless the Court otherwise directs under subsection 68 (2), the officer shall do all such things as are necessary for the orderly winding up of the Affairs of the Foundation the Labuan, and shall collect the Labuan Foundation property, and after discharging or making adequate provision for the discharge of the obligations of the Foundation, shall divide the Labuan property remaining in the manner provided in section 69.


Power of court to order the dissolution of 68. (1) without prejudice to section 65, the Court may, on the application of Foundation of Labuan, or by the creditor or creditors of the Foundation or by the Board of Labuan, ordered the dissolution of the Labuan Foundation if the Court is of the opinion that it is fair and the dissolved Foundation Labuan.

(2) if the court order a foundation Labuan dissolved under this section, the Court may appoint a person who shall be an approved liquidator under section 12 of the companies Act 1990 to oversee the dissolution of Labuan Foundation Labuan and may, from time to time, direct how the liquidation shall be carried out.

Division of property 69. (1) subject to subsection (2), if a foundation Labuan dissolved and property remaining after its dissolution, the property shall be the property of the beneficiary, in accordance with the constituent documents of Labuan, Foundation reserves the right to accept any property remaining after the dissolution of the Labuan Foundation.

(2) in case no provision to the contrary in constituent documents of Labuan Foundation that, if there is more than one beneficiary who lives who is entitled to receive the remaining property, the property remaining shall be divided equally between them.
Labuan Foundation 61 (3) remaining Assets shall be managed in accordance with any applicable laws relating to unclaimed money in force in Malaysia if — (a) No beneficiary who is entitled to receive the remaining property of the Foundation of Labuan as provided in subsection (1);

(b) a beneficiary who is entitled to receive the remaining property refuse to accept property pemindahmilikan who lives it; or (c) there are provisions in the constituent documents of the Foundation of Labuan.


PART IX GENERAL PROVISIONS Fees 70. (1) the Board may fix fees in respect of any services provided by the Board under this Act and with respect to the fees required to be prescribed under this Act.

(2) Sesuatu yayasan Labuan hendaklah membayar apa-apa fi tahunan yang ditetapkan, pada atau sebelum setiap ulang tahun tarikh pendaftarannya.

(3) Jika sesuatu yayasan Labuan tidak membayar fi tahunan yang disebut dalam subseksyen (2) pada atau sebelum habis tempoh enam bulan dari tarikh pembayaran fi tahunan itu, maka hendaklah dibayar sebagai tambahan kepada fi tahunan itu suatu amaun yang bersamaan dengan lima puluh peratus fi tahunan itu.

(4) Apa-apa fi yang dipungut oleh atau dibayar kepada Lembaga di bawah Akta ini hendaklah menjadi sebahagian daripada dan 62 Undang-Undang Malaysia AKTA 706 dikreditkan ke dalam Kumpulan Wang yang ditubuhkan di bawah seksyen 29 Akta Lembaga Perkhidmatan Kewangan Labuan 1996.


Kerahsiaan 71. (1) No person shall in any way have access to any records, books, registers, correspondence, documents, materials or information, in relation to the business and Affairs of the Foundation of Labuan, can provide, reveal, tell, publish or otherwise disclose to any person the records, books, registers, correspondence, documents, materials or information that.

(2) all proceedings, other than criminal proceedings, in relation to any Labuan Foundation initiated in any court under the provisions of this Act and any appeal from such proceedings, shall, unless ordered otherwise by the Court, be heard privately and no details of the proceedings may be published by any person without the consent of the Court.

(3) the provisions of subsection (1) shall not apply if — (a) the disclosure required pursuant to an order of a court having competent jurisdiction in such a proceeding, if the order has been obtained through ex-parte, Labuan Foundation that can tell people that were affected by the order and upon the receipt of the notification, the person affected may file the necessary application to the Court against the order or otherwise comply with such order accordingly;

(b) required for the purposes of the implementation of the functions of the supervision Board as provided under the Labuan Financial Services Act 1996;

Labuan Foundation 63 (c) is in accordance with section 22 Labuan business activity Tax Act 1990; or (d) with the consent of the Labuan Foundation.

(4) subject to subsection (3), any person who in contravention of subsection (1) commits an offence and shall, on conviction, to a fine not exceeding one million dollars or to imprisonment for a term not exceeding three years or both of each.

(5) there is nothing whatsoever in this section shall prevent any

which the Court from exercising its discretion to require any person to produce any document or to give any evidence in any proceedings before the Court in connection with the proceedings.


Right to information 72. (1) subject to the other provisions of this section, the officer or the Secretary of a Labuan Foundation shall, upon the receipt of the request, provide accurate information on the State and the amount of the assets and administrative Foundation Labuan Labuan Foundation that — (a) to the courts;

(b) to the Board in accordance with the provisions of the Labuan Financial Services Act 1996; and (c) to the founder, councilman, those who supervise, or beneficiary, unless the officer has reason to believe that the person making the request duress.

(2) Notwithstanding the terms of the constituent documents, the Court may, on application made to the Court, restrict rights 64 laws of Malaysia ACT 706 founder, councilman, those who supervise, beneficiary or any other person to obtain information relating to the Foundation of the Labuan or may make such other order as it thinks fit.

(3) if any of the founder, a councilman, those who supervise, officer, the Secretary, or beneficiary is required by or under this Act to submit, submit or provide to the Board any information, statistics, statement or document, the Board may provide that it shall be given, forwarded or given in accordance with such form and manner and within such period or any interval or time, in accordance with any provision of this Act or regulations made under this Act , as stated by the Board in setting it, and founder, councilman, those who supervise, officer, the Secretary, or the beneficiary can't submit, submit or provide it as a true and correct any information, statistics, statement or document which he knows, or who he has reason to believe, is false, inaccurate or misleading.

(4) Mana-mana orang yang tidak mematuhi subseksyen (3) melakukan suatu kesalahan dan boleh, apabila disabitkan, didenda tidak melebihi satu juta ringgit atau dipenjarakan selama tempoh tidak melebihi tiga tahun atau kedua-duanya.


Confidential 73. (1) except as may be required, authorized or otherwise provided by this Act, the Court, or constituent documents of Labuan Foundation or as necessary for the purposes of the Foundation of Labuan, and notwithstanding the provisions of any other laws — (a) every Member of the Council, those who supervise, officer, or Secretary of a Labuan Foundation shall at all times consider and deal with all 65 Labuan Foundation documents and information in relation to a foundation of Labuan as secret and confidential; and (b) no member of Council, those who supervise, officer, or Secretary of a Labuan Foundation may at any time be required to submit to or before any court, tribunal, Board, Committee of inquiry or any other authority or to disclose to any such authority any matter or thing come to his knowledge or that are in his possession for any reason , if the thing or the thing is in relation to a foundation of Labuan.

(2) any member of the Council, those who supervise, officer, or Secretary of a Labuan Foundation, except as may be required, authorized or otherwise provided by this Act, the Court, or constituent document, at any time, deliver or attempt to deliver any matter or thing in relation to a Labuan Foundation to any person guilty of an offence and shall, on conviction, to a fine not exceeding one million dollars or to imprisonment for a term not exceeding three years or to both.


Prosecution 74. No prosecution in respect of any offence under this Act shall be instituted except by or with the written consent of the public prosecutor.


Offences in relation to documents Labuan Foundation 75. Any person who makes a statement in any document, substance, evidence or information required to be kept or which are required to be served on the Board under this Act that are false or misleading 66 laws of Malaysia ACT 706 with respect to any material fact or not stating any fact material commits an offence and shall, on conviction, to a fine not exceeding one million dollars or to imprisonment for a term not exceeding three years or to both.


Kesalahan oleh pertubuhan perbadanan 76. (1) where a body corporate commits an offence under this Act, any person who at the time of the Commission of the offence was a Director or officer of the body corporate or is purporting to act upon any such nature or which have in any way or any point is responsible for the management of any Affairs of the body corporate or assist in the management of such — (a) can be prosecuted separately or in association in the same proceedings together with the body corporate; and (b) if the body corporate were found guilty of that offence, shall be deemed to have committed the offence unless, having regard to the type of functions on the property and to all the circumstances, he proves — (i) that the offence was committed without the knowledge, consent or pembiarannya;
and (ii) that he took all reasonable precautions and have carried out due diligence to prevent the occurrence of the offence.

(2) if any person under this Act shall be liable to any penalty or penalties for the Act, omission, neglect or disbelief, he shall be liable to punishment or Foundation Labuan 67 penalties are the same for every act, omission, neglect or default by any employee or his agent, or employee of the agent, if the Act, omission, neglect or default that was done — (a) by an employee of that person during its employment;

(b) by the agent when acting on behalf of that person; or (c) by the agent during the employment by the agent or otherwise on behalf of the agent acting on behalf of that person.


The power of compounding 77. (1) the Board may, with the written consent of the public prosecutor,

compound any offence committed by any person under this Act by making an offer in writing to the person who is reasonably suspected to have committed the offence to compound the offence when paid to the Board a sum of money not exceeding fifty per cent of the maximum fine for the offence in any time as specified in the offer of literary skills.

(2) an offer under subsection (1) may be made at any time after the offence committed but before any prosecution for him started, and if the amount specified in the offer is not paid within the time stated in the offer or any extension of time that can be granted by the Board, a prosecution for the offence may be commenced at any time after that to the person to whom the offer is made.

(3) If an offence has been compounded under subsection (1), no prosecution shall be instituted in respect of the offence against a person to which the compound is made, and any document or thing seized in connection with the offence be released or forfeiture thereof by the Board, subject to 68 laws of Malaysia ACT 706 such terms and conditions as he thinks fit to impose in accordance with the requirements of the compound.

(4) All sums received by the Board under this section shall be paid into the Federal Consolidated Fund.


The authority to impose administrative penalties 78. (1) the Board may impose administrative penalties against any person who fails to comply with any provision of this Act.

(2) the Board shall, before deciding to impose such administrative penalties against any person, deliver to the person a written notice which requires it to show cause why the administrative penalty imposed should not be against it.

(3) Jika suatu penjelasan yang memuaskan tidak diterima dalam apa-apa tempoh yang dinyatakan dalam notis bertulis itu, Lembaga boleh mengenakan suatu penalti pentadbiran sebanyak amaun yang tidak melebihi lima ratus ringgit bagi setiap hari ketidakpatuhan itu dan amaun itu tidak boleh secara keseluruhannya melebihi sepuluh ribu ringgit.

(4) If a person fails to pay an administrative penalty imposed by the Board under subsection (3), penalties imposed by the Board can be sued for him and claimed back as a debt due to the Board.


General power to fix and determine the 79. If any required fixed or determined under this Act and there is no way specified, it shall be determined or determined, as the case may be, in writing, and different provisions may be made for Labuan Foundation 69 different people, class, category or description of different people.


Power of Minister to make regulations 80. (1) the Minister may, on the recommendation of the Board, make regulations as are necessary or expedient to carry out fully the provisions of this Act.

(2) regulations made under this Act shall be set aside for any act or omission that violates any of the regulations to be an offence and may provide for a penalty fine not exceeding twenty-five thousand dollars.


Minister's power to amend Schedule 81. (1) the Minister may, on the recommendation of the Board, from time to time by order published in the Gazette, amend, delete, add, replace, or otherwise amend any schedule and with the broadcast Schedule, as modified, cut, added, replaced or otherwise amended, shall become effective with the full and effective and shall be deemed to be part of this Act from the date of publication, or from the date later than that as stated in the order.

(2) Menteri boleh, dalam mengubah, memotong atau menggantikan mana-mana Jadual yang disebut dalam subseksyen (1), mengenakan apa-apa terma dan syarat yang difikirkannya perlu.


Power of Minister to give exemption 82. The Minister may, on the recommendation of the Board, exclude any Labuan Foundation from any provisions of this Act and may, 70 laws of Malaysia ACT 706 in the waivers, impose such terms and conditions as the Minister thinks fit.


Procedure where no fixed 83. In the event of any act or step required or allowed to be done or taken under this Act and no form or procedure specified in either this Act or regulations made under this Act, the application may be made to the Board to obtain instructions about how to act or the move may be made or taken, and any act or measure made or taken in accordance with the instructions shall be valid for the execution of the Act or the move.



Application of the Labuan financial services Board Act 1996 84. If there is any conflict or inconsistency with the provisions of this Act the Board of Labuan Financial Services Act 1996, the Financial Services Act 1996 shall prevail. Labuan
















Labuan Foundation 71 FIRST SCHEDULE [Subsection 8 (2)] the details of the Charter 1. Labuan Foundation name 2. Name and address of the founders or if the founder is a body corporate or Corporation, place of incorporation and registered office or principal office or place of business 3. The purpose or goal of the Labuan Foundation 4. The identity of the beneficiary or the identification of a body to whom a beneficiary shall be ascertained, or statements that the Foundation of the Labuan would be beneficial to the public as a whole 5. Period, if any, for which the Foundation will exist or Labuan, Labuan will Foundation if exists for the period is not specified, a statement of the fact that 6. Name and address of the Secretary of the Foundation the Labuan Labuan, which is the address of the registered office of the Foundation in accordance with the requirements of section Labuan 44 SECOND SCHEDULE [Subsection 8 (3)] the provisions of the Charter 1. Preservation of rights or powers of the founder of 2. Amendment of the Charter 3. Require or permit articles made 4. Addition or removal of beneficiaries 5. Appointments the Council, Councilman or people who oversee either in lieu of or additions to the Council, and the role and powers of their 72 laws of Malaysia ACT 706




6. Regulation any person who supervises Labuan Foundation 7. The appointment, termination of appointment, terms of Office and authority delegation officials the Foundation Labuan 8. The appointment, termination of appointment and term of Office of the Auditors approved to Labuan Foundation is at the discretion of Council 9. The cancellation of the Charter by the founder and the return of property to the founder of the THIRD SCHEDULE [Subsection 10 (1)] Labuan Foundation Article 1. Distribution of property to beneficiaries 2. Identification of any initial beneficiary or any beneficiary to be determined at later date 3. The minimum value of the Foundation's property in his absence the Labuan no distribution to any beneficiary may be made 4. Identification of beneficiaries living when the dissolved Foundation Labuan FOURTH SCHEDULE [Subsection 14 (1)] Document for registration of Labuan Foundation 1. Pernyataan yang ditandatangani oleh setiausaha yayasan Labuan yang mengandungi butir-butir yang berikut yang dicabut daripada piagam: Yayasan Labuan 73 (a) nama yayasan Labuan (b) tarikh piagam dan tarikh mengenai apa-apa pindaan yang dibuat kepada piagam itu (c) maksud dan matlamat yayasan Labuan (d) tarikh artikel yayasan Labuan itu, jika ada, dan tarikh mengenai apa-apa pindaan yang dibuat kepada artikel itu (e) nama dan alamat setiausaha yayasan Labuan itu (f) alamat pejabat berdaftar yayasan Labuan itu (g) tempoh yang baginya yayasan Labuan itu ditubuhkan (h) salinan asal piagam yayasan Labuan 2. Senarai yang mengandungi nama dan alamat pegawai yayasan Labuan 3. Statutory declaration by the Secretary of the Foundation of Labuan on compliance with all relevant requirements of the FIFTH SCHEDULE of this Act [section 26 and 36] Council meetings and meetings of the officers of the Council meetings and meetings of officers 1. (1) subject to any limits in the constituent documents, a councilman and officer of Labuan could call a Foundation meeting in such manner and at any time and at any place within or outside Labuan as may be necessary.

(2) subject to any limits in the constituent documents, a meeting of the Council and a meeting of officers of a Labuan Foundation can be held in more than one place by using any technology 74 laws of Malaysia ACT 706 which gives all members of the Council and officers a reasonable opportunity to be heard.

Meetings of the Council 2. (1) the following provisions shall become effective as of the constituent documents of a foundation of Labuan does not make the provisions thereof in respect of a meeting of the Council of: (a) a Council meeting may be called by notice seven days in writing;

(b) notice of meetings of the Council shall be communicated to every founder and Council Member himself in writing, by post, by facsimile or electronically at the address on once given to the Labuan Foundation for the purpose of service of such notice;

(c) any member of the Council may call meetings;

(d) a quorum is at least two members of the Council;

(e) the members of the Council present shall elect a Chairman from among their number; and (f) subject to the provisions of this Act, the members of the Council shall approve a resolution, by a majority vote of the members of the ordinary Council, each Council Member has one vote and the Chairman has a casting vote in case of equal votes.

(2) all minutes of meetings of the Council shall be recorded and kept at the registered office.

(3) any such minute as provided in subparagraph (2), if purporting to be signed by the Chairman of the meeting in which the proceedings were held or by the Chairman, the next meeting, shall be evidence of the proceedings.

(4) if the minutes of meetings of the Council were made in accordance with the provisions of this section, the meeting shall be deemed to have been held and started accordingly, until the contrary is proved.

(5) this paragraph shall not apply in the case of the Council which has a single member, and any reference to the minutes of meetings of the Council shall be the Foundation of Labuan 75 evidence of a decision or direction of the Council in relation to any item of any Affairs that Labuan Foundation.
Annual meeting of officials and meetings officer 3. (1) the Foundation of Labuan shall, in each year, to hold at least one meeting of officers as its annual meeting in addition to any other meetings in that year, and shall specify the meeting as such in the notice calling the meeting.

(2) the founder, and a councilman or people who supervise are entitled to — (a) be notified of the meeting;

(b) the present arrangements to be considered at the meeting;
and (c) to attend and be heard at the meeting, but shall not be entitled to vote at the meeting.

Notice of meeting officers 4. Officers of the meeting may be called with seven days notice in writing and notice of the meeting shall be communicated to every founder, Councilman or supervise, officials in writing by post, facsimile or electronically at the address on the Foundation given to Labuan for dissemination of any notice.


Requisition of meeting 5. (1) an Officer of Labuan Foundation, notwithstanding anything in the constituent documents of Labuan Foundation shall, upon requisition of the founders, members of the Council or the person who oversees immediately take action to convene a meeting of officials.

(2) the Requisition shall be — (a) state the aim of the meeting;

(b) signed by the person making the requisition; and (c) be kept at the registered address of the Labuan Foundation.

76 laws of Malaysia ACT 706 (3) If officers do not, within twenty-one days from the date of the requisition, convene a meeting, the person making the requisition may call the meeting, provided that the meeting held within sixty days from the date of the requisition.

(4) a meeting called under this paragraph by the person making the requisition shall be called in the same manner, as nearly as possible, in a manner in accordance therewith meetings shall be called by the officials.

(5) any reasonable expenses incurred by the person making the requisition by reason of the failure of officers to call meetings shall be repaid to the person making the requisition by

Labuan Foundation, and any sum so repaid shall be detained save by the Labuan Foundation from any sum of money payable or will become payable by the Labuan as a foundation or other remuneration fee in respect of the services to any officer of such default.


A quorum of 6. (1) the quorum of a meeting of officers is a quorum set out in the constituent documents of the Foundation of Labuan.

(2) If no quorum laid down in the constituent documents, meetings of officials should be formed accordingly for all purposes if at the beginning of the meeting half of the total officers attend personally or by an alternate person.


Chairman of the meeting officer 7. Officials present at the meeting shall elect from amongst those present a Chairman.


Resolution 8. Officials at the meeting officers shall approve a resolution, subject to the requirements of this Act, through the majority of ordinary votes made by the officers, officers have one vote and the Chairman has a casting vote in case of equal votes.




Labuan Foundation through the agreement of the officers 77 Action in writing 9. Subject to any limits in the constituent documents, an action that may be taken by officials at a meeting of officers may be retrieved through resolution of all officers through the consent in writing or by telex, telegram, facsimile, wire transfer or other written electronic communication, without the necessity of any notice.


An alternate person for 10. (1) subject to any limits in the constituent documents, an officer may by instrument in writing appoint one alternate who did not necessarily have to be an officer.

(2) An alternate for an officer appointed under subparagraph (1) shall be entitled to attend the meeting in the absence of officers who appointed him and to vote or give consent in lieu of the officer.


Minutes of meeting 11. (1) every Labuan Foundation shall cause minutes of all meetings of the officials noted in a book kept for that purpose.

(2) minutes made of meetings of officers, if duly signed, shall be evidence of the proceedings and accepted as prima facie evidence of the facts stated in the minutes without further proof.

(3) if the minutes made of meetings of officers under the provisions of this paragraph, the meeting shall be deemed to have been duly called and held, and all proceedings occurring at the meeting is deemed to have occurred as is necessary until proved otherwise.











78 laws of MALAYSIA Act 706 LABUAN FOUNDATION 2010 LIST ACT AMENDMENT of laws that amend the short title effect from-No-79 laws of MALAYSIA Act 706 ACT LABUAN FOUNDATION 2010 LIST SECTION AMENDED Section Power amend with effect from-no-

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