In a Malaysian Sdn Bhd, a new director is appointed by ordinary resolution of the members, or by the board, under section 202 of the Companies Act 2016 — but only after that person has consented in writing and declared they are not disqualified. A director is removed by ordinary resolution, subject to the constitution. Either way, SSM must be told within fourteen days.
Key takeaways
- Section 201 bars an appointment until the person has consented in writing and declared they are not disqualified; section 202 then appoints by ordinary resolution, or by the board.
- Section 206(1)(a) removes a private company's director by ordinary resolution — but it says “subject to the constitution”, so read that first.
- Section 297(2)(a) forbids passing a removal resolution as a written resolution. A Sdn Bhd's usual circular resolution cannot remove a director.
- Section 196(3) makes a resignation that would leave a Sdn Bhd with no director “deemed to be ineffective”.
- Two fourteen-day clocks: section 57(4) for your register, section 58(1)(c) for SSM. Practice Note 9/2024 sets who signs what goes with it.
On this page8
How do you appoint a new director of a Sdn Bhd in Malaysia?
Two things must happen, in that order. Section 201 of the Companies Act 2016 says a person shall not be appointed as a director unless he has consented in writing and made a declaration that he is not disqualified. Then the members appoint by ordinary resolution under section 202(2), or the board appoints under section 202(3).
- The incoming director signs the section 201 consent in writing and the declaration that they are not disqualified.
- The members pass an ordinary resolution under section 202(2) — or the board appoints, under section 202(3) for an additional director or section 208(4) for a casual vacancy.
- The company updates its register of directors within fourteen days of the change, under section 57(4).
- The company lodges the section 58 notification within fourteen days, with the new director's consent to act and the signed extract of resolution, through SSM's CRS portal.
Step one is a precondition, not a formality: section 201 bars the appointment until the consent and declaration are signed. How long a board appointee's seat lasts then differs by company type — in a private company they hold office “in accordance with the terms of appointment” under section 202(3)(b), where in a public company it would run only to the next annual general meeting.
PT Corporate Services acts as your named company secretary under the Companies Act 2016, handling the statutory registers, resolutions and SSM filings a board change runs through, for Sdn Bhds in Kota Damansara, Petaling Jaya and across the Klang Valley.
Who can be appointed a director of a Sdn Bhd?
Section 196(2) requires a director of a Sdn Bhd to be a natural person who is at least eighteen years of age. Section 198(1) then bars an undischarged bankrupt, anyone convicted of an offence involving bribery, fraud or dishonesty, anyone convicted of an offence relating to the promotion, formation or management of a corporation, anyone convicted under sections 213, 217, 218, 228 and 539 of the Act, and anyone disqualified by the Court.
Residency is a separate test, and a candidate can pass the first and fail this one. Section 196(4)(a) requires the minimum number of directors to “ordinarily reside in Malaysia by having a principal place of residence in Malaysia”. Someone living abroad can be appointed a director of a Sdn Bhd, but cannot be the person who satisfies that residency test — covered in whether a Sdn Bhd needs a resident director.
How do you remove a director of a Sdn Bhd?
Section 206(1)(a) says that in a private company a director may be removed before the expiration of the director's period of office “subject to the constitution … by ordinary resolution”. Removal is one of the events listed in section 208(1) that vacates the office.
Read the constitution before the resolution is drafted: paragraph (a) of section 206(1) carries the words “subject to the constitution”, while paragraph (b) sends a public company's removal through the rest of the section and section 207.
Then check how the resolution will be passed, because this is where a Sdn Bhd most often goes wrong. Section 297(2) says that “the following shall not be passed as a written resolution: (a) a resolution under section 206 to remove a director before the expiration of his term of office”. A Sdn Bhd that settles its decisions by circular resolution cannot remove a director that way; the resolution has to be put to a meeting of members.
Special notice is the other open question. Section 206(3) says “Special notice is required of a resolution to remove a director under this section”, and section 322(1) sets what that means: notice of the intention to move the resolution, given to the company “at least twenty-eight days before the meeting at which it is moved”. How far it reaches into a private company is contested on the face of the Act. Section 207, the right-to-be-heard machinery special notice feeds, is headed “Right to be heard for directors of public company against removal”, and section 207(7) adds that “the constitution of a private company may provide the rights accorded under this section to its directors”. SSM invokes section 206(3) in Practice Note 9/2024 at paragraph 7, in the case of a whole board being removed. Where the constitution is silent, giving the twenty-eight days anyway costs a delay rather than a right.
Practice Note 9/2024 sets out what follows the vote. At paragraph 7, expressly “in line with paragraph 6(b)(ii)” — its whole-board case — SSM states that “the resolution to remove the director shall not take effect until the director's successor has been appointed”, tying that to subsection 196(3), the minimum-number rule, and adding that “the company must have the minimum number of directors in office”. A successor is therefore needed where the removal would otherwise drop the company below its minimum. The Act's own successor-first rule, section 206(4), is narrower again: it covers a public company director appointed to represent a particular class of shareholders or debenture holders.
Removal is only one route to an empty seat. Section 208(1) also vacates the office on resignation, retirement without re-election, disqualification, unsound mind, death, or vacation under the constitution — each a change that enters the company secretarial compliance cycle.
How does a director resign, and when does it take effect?
Section 208(2) lets a director resign by giving a written notice to the company at its registered office. Section 208(3) says that notice is effective when it is delivered at the address of the registered office, or at a later date specified in the notice. The company is not asked to accept it.
The date turns on the registered office address. One limit overrides all of it, though: section 196(3) says a director “shall not resign or vacate his office” if that would take the company below the minimum, and such a resignation is “deemed to be ineffective unless a person is appointed in his place”. A sole director cannot simply walk away: the High Court so held in Tan Kei Vin & 2 Ors v Feed Me Love Sdn Bhd & 2 Ors [2019] 7 AMR 623, of which Skrine wrote that it “does not break new legal ground and merely affirms trite law embodied in the Act”.
Section 209(1) sets out the way through: a sole or last remaining director “shall not resign office until that director has called a meeting of members to receive the notice of the resignation and to appoint one or more new directors”. Where it is the sole or last remaining director's seat that is emptied instead by death, disqualification or unsound mind, section 209(3) puts the duty on the company secretary, who shall “as soon as practicable, call a meeting of the next of kin, other personal representatives or a meeting of members”.
What must be filed with SSM after a director changes, and by when?
Two fourteen-day clocks start together. Section 57(4) requires the company to effect the change in its own register of directors within fourteen days. Section 58(1)(c) requires it to notify the Registrar within fourteen days after a person ceases to be, or becomes, a director.
Section 58(3) governs the notice of someone becoming a director: it must carry the particulars set out in paragraph 57(1)(a) — name, residential address, service address, date of birth, business occupation and identification, plus any other public-company directorships — and be “accompanied with a consent to act in that capacity by that person”. No consent to act is filed when someone leaves. Both directions need one document more: Practice Note 9/2024 states at paragraph 6 that the section 58 notification “shall be accompanied with the relevant extract of resolution” — then names the signatories, and the company secretary appears in every case.
| What happened | Extract to attach | Who signs it |
|---|---|---|
| Appointed at a general meeting | The general meeting resolution | An existing director other than the new one, plus the existing secretary — para 6(a)(i) |
| Board fills a casual vacancy or adds a director | The board resolution, which SSM says “shall be sufficient” | The same two signatories — para 6(a)(ii) |
| A director is removed | The general meeting resolution | A director at the material time, plus the company secretary — para 6(b)(i) |
| The whole board is removed | The general meeting resolution | One of the removed directors or the secretary at that time; or the new director and that secretary; or the new secretary — para 6(b)(ii) |
Paragraph 8 covers the case nobody plans for: the whole-board route also caters for circumstances “where none of the directors' whereabouts can be contacted or the secretary has resigned under subsection 237(2)”.
Where the notification is lodged changed in 2026. Practice Directive 1/2017, revised on 14 July 2026, states at paragraph 5 that from that date all statutory lodgements and notifications “shall be made through the Corporate Registry System (CRS)” — the switch that replaced MyCoID.
What does it cost if the SSM notification is late?
A private company pays a late lodgement penalty on a sliding scale under paragraph 14 of Practice Directive 1/2017: RM50 for a document more than 7 days but not more than 90 days late, RM100 up to 180 days, RM150 up to 365 days, and RM200 beyond a year. The statutory offence under section 58(4) is separate, and far larger.
| How late the document is | Late lodgement penalty, private company |
|---|---|
| More than 7 days but not more than 90 days | RM50 |
| More than 90 days but not more than 180 days | RM100 |
| More than 180 days but not more than 365 days | RM150 |
| More than 365 days | RM200 |
The late lodgement penalty is the small number. Under section 58(4) the company and every officer who contravene the section are liable, on conviction, to a fine not exceeding fifty thousand ringgit, and to a further five hundred ringgit for each day the offence continues after conviction — not from the fifteenth day. Section 57(6) sets ten thousand ringgit on the same basis for the register itself. Relief is discretionary: paragraph 15 lets the Registrar remit the fee wholly or partly where the omission “was accidental or due to inadvertence, or that it is just and equitable to do so”. Budgeting sits in Sdn Bhd setup and running costs.
Frequently asked questions
Can the board of directors remove a director?
Not under section 206. Section 206(1)(a) provides for removal by ordinary resolution, which is a resolution of the members, and the Act gives the board no corresponding power to remove. The board's powers in section 202(3) and section 208(4) are powers to appoint. Because section 206(1)(a) is expressed “subject to the constitution”, the constitution is still the first document to check.
Can a director be removed without their consent?
Yes. Section 206(1)(a) lets the members remove a director “before the expiration of the director's period of office” by ordinary resolution, and nothing in that section requires the director to agree. The right to be heard in section 207 is headed as a right of directors of a public company, and section 207(7) provides that the constitution of a private company may give its directors those rights.
Can someone made bankrupt outside Malaysia be appointed a director?
Not without leave. Section 198(2) states that the bankruptcy and conviction grounds apply to circumstances in or outside Malaysia. Section 198(3) allows an undischarged bankrupt to be appointed with the leave of the Official Receiver, or of the Court.
Sources
- Companies Act 2016 (Act 777) — sections 57, 58, 196, 198, 201, 202, 206, 207, 208, 209, 297 and 322
- Practice Note 9/2024: Clarification on Procedures Relating to Notification of Appointment and Removal of Directors under Section 58 — SSM, 31 December 2024
- Practice Directive 1/2017 (Revised 14 July 2026): Lodgement Requirements and Related Matters — SSM
- High Court: Resignation of sole remaining director — Skrine, on Tan Kei Vin & 2 Ors v Feed Me Love Sdn Bhd & 2 Ors [2019] 7 AMR 623