Gatekeeping - Regulatory Performance and Outcomes | Securities Commission Malaysia

Gatekeeping

As part of its mandate to foster innovation and support new market participants, the SC continues to implement initiatives that streamline regulatory processes and enhance efficiency. This commitment was reinforced in 2025, following the introduction of the Focused Scope Assessment (FSA) framework in 2024.

Facilitative, Open Dialogue for Market Participants

To assist applicants, the SC adopts a facilitative mechanism that encourages prospective applicants to engage in pre-submission consultations (PSC) with the SC. These consultations enable the SC to gain a better understanding of the applicants’ business proposal and assess their alignment within the permitted framework. Through this open dialogue, applicants are given the opportunity to refine their business proposals, documentation, and governance structures, ensuring that they are well-prepared and aligned with the SC’s requirements and expectations prior to submitting a formal application. The SC has observed strong participation in these consultations, reflecting applicants’ proactive approach to meeting regulatory expectations.

In 2025, the PSC facilitation resulted in 49 formal applications, 40 of which were successfully processed. The PSC facilitation had been effective in reducing the time taken towards submission as well as enhancing the quality of the applications submitted by the applicants. Among others, it is noted that applications in 2025 were of better quality as more than 60% of the processed applications came from 2025 PSCs (i.e. 25 PSCs from the 2025 cohort representing 43% of 2025 PSCs) whilst the balance came from the 2023-2024 PSCs.

For applications to be assessed in accordance with the SC’s client charter, the submission made must be complete, valid, accurate with full disclosure and satisfy the relevant licensing or registration requirements. In 2025, all the Capital Markets Services Licence (CMSL) and Capital Markets Services Representative’s Licence (CMSRL) applications were processed within the committed client charter (Table 13). Additionally, the SC has successfully achieved a time-to-market of less than three months for all applications received under the FSA framework in 2025.

During this period, eight new CMSL holders were approved for the following regulated activities:

Fund management (five companies);
Advising on corporate finance (one company);
Dealing in securities (one company); and
Financial planning (one company).

Mitigating Systemic Risks And Promoting Financial Stability

Enhanced Risk Governance Framework

In 2021, the SC-wide risk governance framework was enhanced as part of an overall initiative to have an effective integrated and predictive risk surveillance to maintain regulatory agility.

The structured risk governance framework integrated the wider spectrum of risks such as technology, cyber and conduct risk at the SC’s Systemic Risk Oversight Committee (SROC) and Accounting, Market and Corporate Surveillance Committee (ACMS).

Intensified surveillance

The SC continued to intensify its surveillance of systemic risk to maintain market resilience and stability. Regular SROC engagements were held to deliberate concerns emanating from various segments across the capital market. Domestic equity and bond market, foreign fund flows and trade participation continued to be monitored closely for potential stress points.

In addition, measures and economic stimulus packages introduced by the government to weather the impact of COVID-19, market trading conduct and the financial position of listed companies were among the focus areas for discussion.

Thematic assessments

The SC also conducted thematic assessments covering investors’ fund flows, the position of firms, and policy decisions to ascertain the possible impact on the capital market. In 2021, the SC reviewed and enhanced its crisis indicators on potential emerging risks in the
capital market.

The enhanced crisis indicators provided a reference point for escalation to SROC when the identified indicators and triggers materialised and ensured prompt response to manage and prevent any issues of concern that might lead to a systemic crisis.

Joint regulatory discussions

In 2021, the SC conducted frequent joint regulatory discussions with other authorities such as Bank Negara Malaysia (BNM) and Labuan Financial Services Authority (Labuan FSA) to identify systemic risk concern areas within the financial and capital markets in Malaysia.

Monitoring of various components of the capital market

The SC continued its efforts to undertake a methodological and integrated approach to ensure any potential systemic risk was being monitored, mitigated, or managed. Figure 1 highlights the findings from the following risk assessments on the various components of the capital market.