Suruhanjaya Syarikat Malaysia (SSM) Partnership
Short Write-up
A “Partnership” is an enterprise in which more than one person is involved. The Law allows not more than 20 persons to set up a partnership. Usually, this is called a “firm”. Like a proprietorship, a partnership must be registered with the Registrar of Business under the Registration of Business Act 1956 (Revised 1978). The procedure is simple but a small fee is payable. Any changes in the firm such as a new business, or a change of address or a new partner joining or an old partner leaving – all these must be registered. Partners are entitled to enjoy the profits but a jointly and severally liable to pay and settle the debts and liabilities of the enterprise.
- Ability to hold assets
Under the sole proprietorship, the business assets are the business owner’s own personal assets. Under the partnership structure, the partners will collectively own all the assets to the partnership.
- Liability for debts
In a partnership, all the partners are jointly liable for the debts of the firm, if the debts of the firm cannot be discharged by its own assets, the members of the partnership must contribute from their own personal assets to discharge the firm’s debts.
- Legal proceedings
Sole proprietorships and partnerships have no separate legal personality. As such, legal action can only be instituted or defended in its member(s)’ names.
- Dissolution of the business
Dissolving a partnership can be done by way of agreement, operation of law or in the event that any partner dies, resigns or becomes bankrupt.
- Raising capital
For sole proprietorships and partnerships, capital is raised through contribution of the owner or partners’ personal assets or through loans.
Departments & Agencies
Employees Provident Fund (EPF)
Pertubuhan Keselamatan Sosial (PERKESO)/ Social Security (SOCSO)
Suruhanjaya Syarikat Malaysia (SSM)/Companies Commission of Malaysia
Kementerian Sumber Manusia/Ministry of Human Resources
The Inland Revenue Department
Statutes & Regulations
Employees Provident Fund (EPF)
Employment Act
Income Tax Act
Partnership Act
Registration of Business Act 1956 (Revised 1978)
Socso Act
Effects of non-Compliance
On conviction, the offender is liable to a find not exceeding RM50,000.00 or to imprisonment for a term not exceeding 2 years or both.
The Act also provides that any person who carries on a business at a premise without displaying the certificate of registration (Section 11A) commits an offence and shall on conviction be liable to a fine of RM2,000.00 or to imprisonment for a term not exceeding 6 months or to both.
Generally any contract that is made with any partnership or business that is not registered under the Act shall NOT be enforceable by suit or other legal proceeding (Section 8).
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