|
Q：
|
What is a charge?
|
|
A：
|
A charge is a legal interest or claim on an asset that is used to secure the repayment of a debt or the performance of an obligation. It acts as collateral for a loan or other financial arrangement, ensuring that the lender (or chargee) has a legal right to the asset if the borrower (or chargor) fails to meet their obligations.
|
|
Q：
|
How many types of charges are there in Malaysia?
|
|
A：
|
A charge can be categorised into fixed charge and floating charge.
A fixed charge is a security interest placed on specific tangible assets to secure the repayment of a debt. Under a fixed charge, the chargor cannot dispose of the asset without the chargee’s consent. Fixed charges are typically used for immovable property or specific assets like machinery or equipment.
A floating charge is a security interest over a company’s assets, such as inventory, receivables, or cash, which allows the company to continue using these assets in the normal course of business. However, if specific circumstances (such as default) happens, the floating charge can “crystallise” into a fixed charge.
|
|
Q：
|
What steps must a company take after creating a charge?
|
|
A：
|
A company that establishes a charge over its property or any of its assets must submit a statement of charge details to the Companies Commission of Malaysia (CCM) within 30 days of its creation along with the required fee.
|
|
Q：
|
Is the registration of charges required for property located outside of Malaysia?
|
|
A：
|
A charge must be registered if it is created in Malaysia and affects property located outside of Malaysia. However, additional steps are required to ensure the charge is valid under the laws of the country where the property is situated.
|
|
Q：
|
What shall be done once the charge has been satisfied?
|
|
A：
|
The company is required to submit the relevant details to the CCM within 14 days of the payment, settlement, or release of the charge. The Registrar will then record this information in the register.
|
FAQ
