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CHAPTER 4: THE HISTORICAL DEVELOPMENT OF CORPORATE
4.1 Introduction
AND INSOLVENCY LAWS
British colonisation in Malaya 1 charted a passage for the latter‟s legal system. The
importation of English law into Malaya at the time was appropriate and seemly since
it was subject to the British administration. The continuance of reliance on English
law after Malaya reached its independence was acceptable to ensure smooth
transition in the country. In relation to company legislation, the law employed was
based on English company legislation in the early twentieth century.
English law, as elucidated below, metamorphosed as a result of various reforms.
Though English law has progressed since then, Malaysia continues to depend on the
law enacted in the 1960s. Any reforms or amendments made to the legislation were
slow and on an ad hoc basis as demonstrated during the Asian financial crisis. Any
weaknesses in the law identified and remedied by subsequent legislation in the UK
remain part of Malaysia‟s company legislation.
Australia and New Zealand are also considered as the basis of comparison because of
their similar legal history i.e. the adaptations of English law in their jurisdiction.
However, where English law became part of Malaya through colonisation, it is
woven through Australia and New Zealand due to the establishment of self
governing dominions. Unlike Malaysia, these countries, especially Australia, are
dynamic in reforming their company law legislation to reflect changes in social and
economic structures.
1 Malaya was the name prior to the formation of Malaysia on 16 th September 1963 which comprises
Malaya, Sabah and Sarawak.
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