Placement of the Company, etc., under administration
Subject to the prior written approval of the Minister, a member of the Company, or the board of directors of the Company pursuant to a resolution of the board of directors, may place—
(a) the Company;
(b) any wholly owned subsidiary company of the Company; and
(c) the following partially owned subsidiary companies of the Company:
(i) Abacus Distribution Systems (Malaysia) Sdn. Bhd. (Company No. 180535-T);
(ii) Aerokleen Services Sdn. Bhd. (Company No. 277266-X); and
(iii) MAS Awana Services Sdn. Bhd. (Company No. 372384-D),
under administration in accordance with this Act.
Appointment of Administrator
(1) The member of the Company or the board of directors of the Company referred to in section 4 shall appoint an Administrator for the Administered Companies.
(2) The appointer may at any time after the appointment of the Administrator under subsection (1) appoint a new Administrator to replace the existing Administrator.
(3) Where the Administrator is released from his appointment, he shall, with effect from such release, be discharged from all duties and liabilities in respect of his administration or in relation to his conduct as the Administrator.
Duration of administration
The administration of the Administered Companies by the Administrator shall commence from the date of appointment of the Administrator under subsection 5(1) and shall continue until the administration is terminated by the appointer.
Qualifications of Administrator
(1) No person shall be appointed as an Administrator unless he—
(a) is a natural person; and
(b) has consented in writing to his appointment.
(2) The following persons shall be qualified to be appointed as an Administrator:
(a) a company auditor approved under the Companies Act 1965; or
(b) a person who is, in the opinion of the appointer, capable of performing the duties of an administrator.
(3) The following persons shall not be qualified to be appointed as an Administrator:
(a) an undischarged bankrupt;
(b) a mortgagee of any property of the Administered Companies;
(c) a person with direct or indirect shareholding in the Administered Companies;
(d) a person who is, directly or indirectly, interested in any contract or arrangement to provide goods or services to the Administered Companies;
(e) an auditor of the Administered Companies; or
(f) an officer of the Administered Companies.
Notification of appointment of Administrator
(1) The Administrator shall within seven days after his appointment—
(a) lodge a notice of the appointment with the Registrar of Companies; and
(b) cause a notice of his appointment to be published in at least two national daily newspapers, one of which shall be in the national language.
(2) Every invoice, order for goods or services, business letter, cheque, credit note, negotiable instrument or bill of lading which is issued by or on behalf of the Administered Companies or the Administrator after the appointment of the Administrator shall contain the words “Administrator Appointed”.
(3) Any non-compliance of subsections (1) and (2) shall not affect the validity of the acts of the Administrator in the administration of the Administered Companies.
(4) For the purpose of this section, “Registrar of Companies” has the meaning assigned to it under section 4 of the Companies Act 1965.
Functions of Administrator
(1) The Administrator shall have the following functions:
(a) to carry out the business and operations (including the restructuring of such operations) of the Administered Companies;
(b) to take into his custody or under his control the property, liabilities, businesses and affairs of the Administered Companies and all the property to which the Administered Companies are or appear to be entitled;
(c) to manage the property, business, liabilities and affairs of the Administered Companies in the name and on behalf of the Administered Companies, including the disposal of property and liabilities;
(d) to assume control and exercise all powers conferred on the directors under the Companies Act 1965 or by the constitution of the Administered Companies, and the powers of the directors of the Administered Companies shall then cease except in so far as the Administrator may permit;
(e) to make any arrangement or compromise on behalf of the Administered Companies with their creditors or any class of them or between the specified subsidiary companies and their members or any class of them or between the Administered Companies and their debtors or any class of them; and
(f) to perform any function that the Administered Companies or any of their officers could perform or exercise if the Administrator had not been appointed.
(2) Nothing in paragraph (1)(d) shall require the Administrator to call any meetings of the Administered Companies.
Powers of Administrator
In performing his functions under section 9, the Administrator shall have the following powers:
(a) to carry on the business of the Administered Companies;
(b) to do all things (including the carrying out of works) as may be necessary for the management, realization and preservation of the property, undertakings and affairs of the Administered Companies;
(c) to appoint any person as a director of any of the Administered Companies, whether to fill a vacancy or otherwise, and to remove or suspend from office any director of the Administered Companies notwithstanding the Memorandum and Articles of Association or any other law;
(d) to take possession of the property of the Administered Companies and for that purpose, to take such proceedings as may seem to him expedient;
(e) to sell or otherwise dispose of all or part of the property, business, undertaking or property of the Administered Companies by public auction or private contract;
(f) to raise or borrow money and grant security over the property of the Administered Companies for the raising or borrowing of such money;
(g) to appoint a solicitor or an accountant, or other professionally qualified person to assist him in the performance of his functions;
(h) to bring or defend any action or other legal proceedings in the name and on behalf of the Administered Companies;
(i) to refer to arbitration any question affecting the Administered Companies;
(j) to effect and maintain insurances in respect of the property of the Administered Companies;
(k) t o u s e t h e c o m m o n s e a l o f t h e A d m i n i s t e r e d Companies;
(l) to do all acts and to execute in the name and on behalf of the Administered Companies any deed, receipt or other document;
(m) to draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of the Administered Companies;
(n) to employ or terminate employees, and to determine the compensation payable to such dismissed employees;
(o) to transfer any property, business, liabilities and affairs of the Administered Companies to the Malaysia Airlines Berhad or any of the Malaysia Airlines Berhad’s subsidiary companies;
(p) to purchase the shares, property and equipment of any company, in which the Administered Companies are existing shareholders, that supplies goods or services or both which are essential to ensure the uninterrupted continuation of the business vested or to be vested in the Malaysia Airlines Berhad pursuant to Part V;
(q) to grant or accept a surrender of a lease or tenancy of the property of the Administered Companies, and to take a lease or tenancy of any property required or convenient for the property of the Administered Companies;
(r) to call up any uncalled capital of the Administered Companies, alter or reduce all or part of the share capital of the Administered Companies;
(s) to rank and claim in the bankruptcy, insolvency or liquidation of any person indebted to the Administered Companies and to receive dividends, and to accede to trust deeds for the creditors of any such person;
(t) to present or defend a petition for the winding up of the Administered Companies;
(u) to change the location of any of the Administered Companies’ registered offices;
(v) to appoint any agent to do any business which the Administrator is unable to do himself or which can more conveniently be done by an agent;
(w) to make any payment which is necessary or incidental to the performance of his functions; and
(x) to do all other things incidental to the performance of the Administrator’s functions.
Effect of appointment of Administrator
(1) On the appointment of the Administrator, a moratorium shall take effect during which—
(a) no petition for the winding up of the Administered Companies may be filed by any person in any court;
(b) no resolution may be passed or order made for the winding up of the Administered Companies;
(c) no receiver, receiver and manager or provisional liquidator, may be appointed, or if appointed, his appointment shall immediately cease and he shall vacate his office;
(d) no steps may be taken—
(i) to create, perfect or enforce any security over any property of the Administered Companies;
(ii) to enforce a judgment over any property of the Administered Companies;
(iii) to re-possess any property in the possession, custody or control of the Administered Companies; or
(iv) to set off any debt owing to the Administered Companies in respect of any claim against the Administered Companies,
e x c e p t w i t h t h e p r i o r w r i t t e n c o n s e n t o f t h e Administrator;
(e) no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator;
(f) any application made under section 176 of the Companies Act 1965 shall be adjourned sine die and any restraining order issued under subsection 176(10) of the Companies Act 1965 shall be immediately discharged and set aside; and
(g) no proceedings and no execution or other legal process in any court or tribunal may be commenced, or continued with, against any person providing a guarantee or acting as a guarantor for the liability of the Administered Companies in respect of that liability except with the prior written consent of the Administrator.
(2) The Administrator shall not be liable to an action or other damages in respect of a refusal to give his consent under subsection (1).
(3) The appointment of the Administrator shall not—
(a) be regarded as placing the Administrator or the Administered Companies in breach of or in default under any contract, or in breach of confidence;
(b) be regarded as placing the Administered Companies in breach of or in default under any contract or be regarded as giving rise to a right or duty for any person to—
(i) terminate, cancel or modify an agreement;
(ii) enforce or accelerate the performance of an obligation of the Administered Companies;
(iii) require the performance of an obligation not otherwise arising for performance; or
(iv) refuse or discontinue the performance of his obligations;
(c) be regarded as placing the Administrator or the Administered Companies in breach of any law or agreement prohibiting, restricting or regulating the assignment, sale, disposition or transfer of any property or disclosure of information;
(d) release a surety from an obligation;
(e) invalidate or discharge a contract or security;
(f) be regarded as terminating, cancelling or varying any right, privilege, exemption or priorities in relation to a property of the Administered Companies; or
(g) be regarded as placing the Administered Companies or the Administrator in breach of any law or any order of any court.
(4) Nothing in this section shall prevent any civil or criminal proceedings from being instituted or continued by any regulatory body against the Administered Companies.
Moratorium
(1) The duration of the moratorium referred to in section 11, unless the administration is sooner terminated under section 6 or paragraph 20(3)(c), shall be for a period of twelve months commencing from the date of the appointment of the Administrator under subsection 5(1).
(2) The Minister may, upon the written request of the Administrator or the appointer, extend the moratorium for a period of not more than twelve months upon being satisfied that the circumstances warrant such extension, and such power of extension shall not be exercisable more than once.
(3) If the period of the moratorium is extended under subsection (2), the Administrator shall cause a notice of the extension to be published in at least two national daily newspapers, one of which shall be in the national language.
Undue preference
(1) On the appointment of the Administrator, any transfer, mortgage, execution, attachment, obligation, settlement, charge, assignment, delivery of goods, payment or other act relating to any property made, incurred or done by or against the Administered Companies which, had it been made, incurred or done by or against an individual, would in his bankruptcy under the law of bankruptcy be void or voidable, may be avoided or recoverable by the Administrator.
(2) Where a reference is made in the law of bankruptcy to a date for the purpose of determining the effect of bankruptcy on transactions mentioned in subsection (1), that date shall be the date on which this Act comes into operation.
Transition services
(1) Where any person is under a contract or obligation to provide goods or services or both to the Administered Companies, such person shall continue to provide the goods or services or both to the Malaysia Airlines Berhad and its subsidiary companies instead of the Administered Companies, where required by the Administrator, and the Malaysia Airlines Berhad and its subsidiary companies shall pay for such goods or services or both at the same rate as would have been paid by the Administered Companies.
(2) Notwithstanding any other provisions of this Act or any other law, where the person fails to provide the goods or services or both to the Malaysia Airlines Berhad and its subsidiary companies as required under subsection (1), the Malaysia Airlines Berhad and its subsidiary companies shall have the right to recover from such person any costs incurred or damages for any loss suffered.
Investigation by Administrator
(1) The Administrator may require any officer of the Administered Companies to verify and submit to the Administrator a statement as to the affairs of the Administered Companies within twenty-one days.
(2) The statement shall be in such form as may be determined by the Administrator and shall contain the following information:
(a) the particulars of all property and liabilities;
(b) the names and addresses of the creditors;
(c) the securities held by the creditors and the dates when the securities were given;
(d) a statutory declaration made under the Statutory Declarations Act 1960 [Act 13], declaring the information in the statement of affairs as being true and correct; and
(e) any other information as may be required by the Administrator.
Duties of officers to assist in investigation
(1) An officer of the Administered Companies shall within seven days after a request from the Administrator—
(a) deliver to the Administrator all books, records and documents of the Administered Companies in the possession of the officer; and
(b) if the officer knows the location of other books, records and documents relating to the Administered Companies, inform the Administrator of the location of those books, records and documents.
(2) An officer of the Administered Companies shall—
(a) attend to the Administrator at such times; and
(b) give the Administrator such information concerning the Administered Companies’ property, affairs and financial circumstances,
as the Administrator may reasonably require.
(3) The Administrator shall, on the completion of the administration under this Act, return to the Administered Companies any books, records and documents received under subsection (1).
Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).
