Legal Updates for February 2022

Extension of Part IV of AMLA to IEOs, Digital Custodians and Digital Asset Advisors, and Explicit Broadening to Equity Crowdfunding, Crowdfunding, P2P and other Recognised Market Operator Platforms

On 24 December 2021, the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities (Invocation of Part IV) Order 2021 and the Anti-Money Laundering, Anti-Terrorism Financing And Proceeds Of Unlawful Activities (Amendment Of First And Second Schedules) Order 2021 extended the application of Part IV of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 ("AMLA") to digital asset custodians, intermediaries, and those involved in the provision of advisory services relating to the offer or sale of digital currencies or digital tokens. Part IV of AMLA deals with reporting obligations of reporting institutions, including the duties for record-keeping, customer due diligence, having and maintaining a compliance programme, and other requirements relating to disclosure, tip-off, and investigation or protection of reporting persons and institutions.

This Update provides a summary of the key amendments, as well as the impact on operators and consequences of non-compliance.

High Court Issues Key Decisions on Schemes of Arrangement
  1. the classification of creditors;
  2. the threshold test for disclosures in the explanatory scheme;
  3. the validity of virtual scheme meetings;
  4. the extension of time for submission of proofs of debt ("PODs");
  5. the inspection of other scheme creditors' PODs; and
  6. the discounting of scheme creditors' votes.

 This Update provides a summary of the above principles.

Proposed Amendments to the Personal Data Protection Act 2010 (PDPA): Latest Updates

In 2018, the Malaysian Government announced its intention to carry out a comprehensive review and to update the Personal Data Protection Act 2010 (“PDPA”), with a view to aligning the PDPA with international standards. Since then, the Department of Personal Data Protection (Jabatan Perlindungan Data Peribadi) (“JPDP”) has carried out a review exercise, and published a public consultation paper in February 2020 titled “Public Consultation Paper No. 01/2020 on Review of the PDPA” (“Public Consultation Paper”). The Public Consultation Paper sets out 22 areas of proposed amendments for public feedback.

However, as of the date of this article, no draft amendment bill has been tabled in the Malaysian Parliament notwithstanding the confirmation by the Malaysian Government that the PDPA will be updated within the next few years. Nonetheless, JPDP has recently provided insights on the status of the proposed amendments. Therefore, this article seeks to provide a quick update on the status of the proposed amendment bill, as well as further details regarding the proposed changes that will be included in the amendment bill.

Climate Risk Management and Scenario Analysis (Exposure Draft)

Recognising the characteristics of climate-related risks, Bank Negara Malaysia (“BNM”) has issued the Exposure Draft on Climate Risk Management and Scenario Analysis (“Exposure Draft”) which sets out the principles and specific requirements on the management of climate-related risks by financial institutions, with the aim to enhance the resilience of the financial sector against climate-related risks. Any feedback on the Exposure Draft can be submitted to BNM by 31 March 2022.

What You Need to Know about the AIAC Arbitration Rules 2021

The Asian International Arbitration Centre ("AIAC") published its Arbitration Rules 2021 ("2021 Rules") for public consultation in June 2021. The rules took effect on 1 August 2021. With the objective of providing "a wider range of sophisticated and tailored provisions to govern the efficient conduct of arbitration proceedings" and to offer a "comparable and competitive product reflecting contemporary international standards and practices on the global stage", the 2021 Rules are a substantial upgrade to the AIAC Arbitration Rules 2018 ("2018 Rules"). Notable features are:

a. The consolidation of the UNCITRAL Arbitration Rules 2013 with the AIAC Arbitration Rules;

b. A new Fast Track Procedure;

c. A new summary determination mechanism;

d. Provision for the consolidation of multi-contractual disputes under a single Notice of Arbitration;

e. A new procedure for the appointment of arbitrators;

f. Provisions regarding the publishing of arbitral awards; and

g. Provisions regarding third-party funding.

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