The Review Process Of Documents Relating To Offers And Schemes

The Securities Commission Malaysia (SC) reviews documents relating to offers and schemes that fall under Division 2 of Part VI of Capital Markets and Services Act 2007 (CMSA) and the Rules on Take-overs, Mergers and Compulsory Acquisitions (Rules). The objective of the review is to ensure compliance with the requirements under the CMSA, the Malaysian Code on Take-overs and Mergers 2016 and the Rules.

In this connection, the Take-overs and Mergers Department (TOM) reviews and provides comments on the disclosure made in offer documents and offeree board circular (for offers), scheme documents (for schemes) and independent advice circulars (for both offers and schemes).

The relevant documents are to comply with the minimum disclosure requirements as provided for in Schedule 1 (for offer documents), Schedule 2 (for independent advice circulars) and Schedule 3 (for scheme documents) under the Rules. All these documents could only be posted to the board, shareholders and holders of convertible securities of the offeree after the SC has notified that it has no further comments thereon.

An adviser who is to provide independent advice made through an independent advice circular will need to ensure its independence based on the factors provided under paragraphs 3.09 and 3.10 of the Rules. This is to ensure the offeree shareholders receive competent independent advice before making an informed decision on the offer or the scheme. The independence assessment of an adviser is a self- examination approach and its appointment is not subject to the SC’s approval. Nevertheless, the appointed adviser is to confirm its independence to the SC within 3 days of its appointment. In addition, broad guiding principles on the quantitative and qualitative assessment by an independent adviser are provided to assist the independent adviser in making recommendation on offers and schemes.

Given that timing is of essence in an offer and scheme, the Rules stipulated specific timeline for the submission of documents for the SC’s review and their dispatch.

For offers, the first draft offer document is to be submitted to the SC within 4 days after the issuance of the offer notice whilst the first draft offeree board circular and independent advice circular are to reach the SC within 20 days after the issuance of the offer notice. The final offer document is to be issued by 21 days after the offer notice whilst offeree board circular and independent advice circular are to be dispatched within 10 days, subsequent to the issuance of the offer document.

Offer Documentation Timeline

Scheme Documentation Timeline

For schemes, the SC would expect to receive the first draft scheme document within 4 days, and the first draft independent advice circular within 20 days, from the date of the announcement by the offeree board to table the resolution of the scheme for its shareholders’ approval. Both scheme document and independent advice circular are to be posted within 35 days of the above mentioned announcement.

For continuous improvement in our transparency and accountability, the SC reveals its performance in the discharge of its regulatory functions. We provide a brief synopsis on the functions and the underlying principles and regulations we refer to in the evaluation of proposals. It is with strict adherence to these principles that we discharge our regulatory functions and the results of our performance are presented below.

Corporate Proposals

The SC reviews proposals for listing and RTO on the Main Market of Bursa Malaysia Securities Bhd under section 212 of the Capital Markets and Services Act 2007 (CMSA). In this regard, it checks if the proposal is in compliance with the Equity Guidelines, and that the applicants’ directors and substantial shareholders are free from any adverse records and corporate governance issues. The SC also reviews and registers prospectuses under sections 232 and 237 of the CMSA for offerings of securities on both the Main and ACE Markets.

Private Debt Securities (PDS)

Evaluate PDS proposals, monitoring of compliance with the securities laws, regulations and guidelines relating to issues, offers of PDS, for the purpose of achieving the SC’s objectives of promoting and maintaining an orderly, fair, efficient, secure and transparent securities market and affording adequate investor protection.

Take-over Offers

Regulates take-overs and mergers under Division 2 of Part VI of the CMSA. In this regard, the Malaysian Code on Take-overs and Mergers 2016 sets out broad principles to be adhered to by parties involved in a take-over or merger transaction and the Rules on Take-overs, Mergers and Compulsory Acquisitions (Rules) provides operational and conduct requirements.

Collective Investment Schemes (CIS)

Evaluate proposals relating to the issuance of securities by CIS, vetting and clearance of prospectuses and deeds, registration of prospectuses and deeds, vetting of prospectuses, fund reports, promotional materials and advertisements, to ensure the orderly regulation of the industry.

Licensing

Execute all licensing activities, monitor fit and properness of licensees, administer disciplinary actions on licensees and ensure the processes are done in a transparent, efficient and effective manner.

Time to Market

Services Provided	Client Charter
Corporate Proposals
Main Market IPO / RTO	60 Working Days
Large Capitalisation IPO	40 Working Days
ACE Market (IPO prospectus review & registration)	40 Working Days
Licensing
Representative
New	14 calendar days
Company
New	42 calendar days
Private Debt Securities
PDS Guidelines and Islamic Securities Guidelines	14 working days
ABS Guidelines	28 working days
Collective Investment Schemes
Establishment of new fund	21 calendar days (excluding public holidays)
Real estate investment trust (REIT) and exchange-traded fund (ETF)	2-3 months (excluding public holidays)

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The Licensing Process
The Approval Process of Initial Public Offerings (IPOs) in Malaysia
The Review Process of Documents Relating to Offers and Schemes
The Approval Process of Unit Trust Funds in Malaysia
The Approval Process of Initial Public Offerings (IPOs) of Real Estate Investment Trusts (REITs) in Malaysia
The Complaints Management Process

Material	Release date *
Updated List of Shariah-compliant Securities by the SC’s SAC	every last Friday of May and November
Statistics of Licensed Intermediaries	every 7th of the following quarter
List of Licensed Intermediaries	every 10th of the month

* subject to change

The documents review by the SC is to facilitate the promotion of a fair, efficient and transparent take-over market through quality and meaningful disclosure with the provision of relevant and sufficient information so that shareholders could consider the offer or scheme within a reasonable time period.

Client Charter & Performance Statistics
For continuous improvement in our transparency and accountability, the SC reveals its performance in the discharge of its regulatory functions. We provide a brief synopsis on the functions and the underlying principles and regulations we refer to in the evaluation of proposals. It is with strict adherence to these principles that we discharge our regulatory functions and the results of our performance are presented below.

Corporate Proposals
The SC reviews proposals for listing and RTO on the Main Market of Bursa Malaysia Securities Bhd under section 212 of the Capital Markets and Services Act 2007 (CMSA). In this regard, it checks if the proposal is in compliance with the Equity Guidelines, and that the applicants’ directors and substantial shareholders are free from any adverse records and corporate governance issues. The SC also reviews and registers prospectuses under sections 232 and 237 of the CMSA for offerings of securities on both the Main and ACE Markets.

Private Debt Securities (PDS)
Evaluate PDS proposals, monitoring of compliance with the securities laws, regulations and guidelines relating to issues, offers of PDS, for the purpose of achieving the SC’s objectives of promoting and maintaining an orderly, fair, efficient, secure and transparent securities market and affording adequate investor protection.

Take-over Offers
Regulates take-overs and mergers under Division 2 of Part VI of the CMSA. In this regard, the Malaysian Code on Take-overs and Mergers 2016 sets out broad principles to be adhered to by parties involved in a take-over or merger transaction and the Rules on Take-overs, Mergers and Compulsory Acquisitions (Rules) provides operational and conduct requirements.

Applications for compliance with the Bumiputera equity requirements
Analyse the effect of proposals in particular the Bumiputera equity participation, in accordance with the National Development Policy.

Collective Investment Schemes (CIS)
Evaluate proposals relating to the issuance of securities by CIS, vetting and clearance of prospectuses and deeds, registration of prospectuses and deeds, vetting of prospectuses, fund reports, promotional materials and advertisements, to ensure the orderly regulation of the industry.

Licensing
Execute all licensing activities, monitor fit and properness of licensees, administer disciplinary actions on licensees and ensure the processes are done in a transparent, efficient and effective manner.
SC Scorecard
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IPO Non-Approval
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Business Processes
The Licensing Process
The Approval Process of Initial Public Offerings (IPOs) in Malaysia
The Review Process of Documents Relating to Offers and Schemes
The Approval Process of Unit Trust Funds in Malaysia
The Approval Process of Initial Public Offerings (IPOs) of Real Estate Investment Trusts (REITs) in Malaysia
The Complaints Management Process
Calendar of Periodic Updates
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