Nominee Agreement Template for Malaysia

A Nominee Agreement creates a legal arrangement where one party (the nominee) agrees to hold assets, shares, or property on behalf of another party (the beneficial owner) in Malaysia. Think of it like having someone act as your representative while you maintain actual ownership behind the scenes.

These agreements are common in Malaysian business structures, especially when foreign companies need local shareholders to comply with ownership requirements. The nominee must follow the beneficial owner's instructions and can't claim true ownership of the assets. Malaysian law requires these agreements to be properly documented and disclosed to relevant authorities to prevent misuse in money laundering or tax evasion.

Consider using a Nominee Agreement when expanding your business in Malaysia while needing to meet local ownership requirements. This is particularly relevant for foreign companies who must maintain specific percentages of Malaysian shareholding but want to retain effective control of their business operations.

The agreement becomes essential when setting up nominee arrangements for property holdings, company shares, or business assets. It protects both parties by clearly documenting the true ownership structure, voting rights, and profit-sharing arrangements. Many Malaysian banks and regulatory bodies require these agreements for corporate accounts, property transactions, and business registrations involving nominee structures.

• Share Nominee Agreement: Used for holding company shares on behalf of foreign investors, specifying voting rights and dividend arrangements
• Property Nominee Agreement: Manages property holdings where nominees act as registered owners while beneficial owners retain actual control
• Director Nominee Agreement: Details responsibilities when local directors serve as nominees for foreign companies
• Bank Account Nominee Agreement: Establishes terms for nominees managing corporate bank accounts under Malaysian banking regulations
• Trust Nominee Agreement: Creates broader nominee arrangements for multiple assets or investments under Malaysian trust laws

• Foreign Investors: Beneficial owners who need Malaysian nominees to comply with local ownership requirements while maintaining control of their investments
• Local Nominees: Malaysian citizens or companies who formally hold assets or positions on behalf of others, often receiving fees for their services
• Corporate Lawyers: Draft and review Nominee Agreements to ensure compliance with Malaysian regulations and protect all parties' interests
• Company Secretaries: Handle documentation and filing requirements related to nominee arrangements
• Regulatory Bodies: Monitor and enforce compliance with Malaysian nominee structure regulations, including SSM and BNM

• Identify Parties: Gather complete details of nominee and beneficial owner, including identification documents and company registration numbers
• Asset Details: Document specific assets being held under nominee arrangement, including shares, property titles, or bank accounts
• Ownership Terms: Define exact rights, responsibilities, and limitations of the nominee's role
• Payment Structure: Outline nominee fees, profit-sharing arrangements, and expense reimbursement terms
• Compliance Check: Verify arrangement meets Malaysian ownership requirements and regulatory guidelines
• Documentation: Collect supporting documents like board resolutions and ownership certificates

• Party Identification: Full legal names, addresses, and registration numbers of nominee and beneficial owner
• Asset Description: Detailed specification of shares, property, or assets under nominee arrangement
• Nominee Powers: Clear outline of nominee's authority, voting rights, and limitations
• Beneficial Ownership: Express declaration of true ownership and control rights
• Termination Terms: Conditions and procedures for ending the nominee arrangement
• Indemnification: Protection clauses for both parties against potential losses or claims
• Governing Law: Explicit statement of Malaysian law jurisdiction and compliance requirements

A Nominee Agreement is often confused with an Agency Agreement, but they serve distinct purposes in Malaysian business law. While both involve one party acting on behalf of another, their legal implications and operational scope differ significantly.

• Legal Relationship: A Nominee Agreement creates a beneficial ownership arrangement where the nominee holds assets in their name but has no real control. An Agency Agreement grants actual authority to act and make decisions on behalf of the principal.
• Asset Control: Nominees can only act under strict instructions from the beneficial owner, while agents have broader discretionary powers within their scope of authority.
• Regulatory Context: Nominee Agreements often relate to corporate ownership structures and require specific disclosures under Malaysian law. Agency Agreements focus on business operations and commercial transactions with fewer regulatory requirements.
• Duration: Nominee arrangements typically persist until ownership transfer, while agency relationships are often task or time-specific.