Criteria of Beneficial Ownership

In Malaysia, the Companies Commission of Malaysia (SSM) requires companies to identify and report their beneficial owners — the individuals who ultimately own or control a company, even if their names do not appear on official documents like the register of members.

This is to promote transparency, prevent money laundering, and ensure that the true decision-makers behind a company are known. Beneficial ownership can be held directly (e.g., listed as a shareholder) or indirectly (e.g., through another company, agreement, or nominee).

SSM’s guidelines set out six criteria to help companies determine who qualifies as a beneficial owner, based on ownership percentage, voting rights, ability to control decisions, or influence over the board.

Criteria for Determining Beneficial Ownership

Criteria	What it Means
A	A person or company owns 20% or more of the company’s ordinary shares, directly or indirectly. Includes joint ownership, agreements, or nominee arrangements.
B	A person or company owns 20% or more of the company’s voting shares, directly or indirectly. Includes joint ownership, agreements, or nominee arrangements.
C	A person, even if not a shareholder or director, has the real power to control the company or its directors, formally or informally. Their suggestions are always followed.
D	A person has the power to appoint or remove directors who control most votes at board meetings, directly or indirectly.
E	A person has an agreement with another shareholder that together they control most of the voting rights.
F	Even with less than 20% of shares or voting rights, a person still has significant influence or control over the company.

** One shareholder can meet more than one (1) criteria at the same time.
Example — a person can fall under both Criteria A and B simultaneously

Comparison of Criteria

Criteria	Focus	Ownership Requirement	Other Notes
A	Shareholding	20% or more of ordinary shares	Referring to ordinary shares based on Register of Members ("shareholding")
B	Voting Shares	20% or more of voting shares	Referring to voting shares/voting rights as defined in the constitution
C	Effective Control	No % required	Person’s advice is always followed, even if they have no shares
D	Appoint/Remove Directors	No % required	Can appoint/remove key directors, even if they have no shares
E	Voting Control via Agreement	Depends on agreement	Control comes from an agreement with others; generally through Nominee Shareholder Agreement
F	Significant Influence	Less than 20% of shares/votes	Still has real control or influence

Who Can Access Beneficial Ownership Information

Beneficial Ownership (BO) information can only be accessed by the following individuals or groups:

Beneficial owner — only relating to their own information;
Person authorised in writing by the beneficial owner — only relating to their information;
Any reporting institution carrying on any activity listed in the First Schedule to the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (Act 613);
Bank Negara Malaysia as the competent authority under Act 613;
Any enforcement agency in Malaysia under Act 613;
Ministry of Finance in carrying out Government procurement functions.

Please refer to: Companies (Access To The Register And Information Relating To Beneficial Ownership) Regulations 2025

When to Update Beneficial Ownership Details to SSM (SDN BHD)

Within 14 days from the date the beneficial ownership information is recorded in the register of beneficial owners.
Within 14 days from the date of any changes to the beneficial ownership information.
Lodge annual return together with the beneficial ownership information not later than 30 days from the anniversary of its incorporation date.

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Malaysia