Corporate Trusteeship

AREAS OF PRACTICE

Corporate Trusteeship

A corporate trustee’s role is to act independently in the interest of the trust. It carries out its duties according to the provisions of the trust instruments and the relevant Acts and Guidelines.

For a member to act as trustee for Private Debts Securities (PDS) / Sukuk, the member must be registered and approved as trustee by the Securities Commission Malaysia. Please refer to the website of Securities Commission Malaysia at www.sc.com.my for the latest list of members who are approved and registered to act as trustee for PDS / Sukuk.

PDS / Sukuk

Private Debts Securities (PDS) / Sukuk

Bond/Sukuk Trustee

To represent and protect the interest of the holders in accordance with the trust deed.
To act as a focal point for interaction between the holders and the Issuer.

Security Trustee/Security Agent

To hold security on behalf of the holders and to administer the securities on behalf of the holders in a professional manner as required by the transaction document.

Share Trustee

To hold the entire legal and beneficial ownership of the shares of the SPV under a trust for identified beneficiaries.
To administer and exercise the powers in relation to the trust fund in accordance with the provisions of the declaration of trust.

Transaction Administrator

Administer and monitor various designated account.
To remit to the Paying Agent for disbursement of interest and principal payments which is due to the investors.

Process Agent

Applicable to the foreign company who issues PDS in Malaysia
To receive on behalf of the Issuer the “service of process” in an Event of Default scenario.
To communicate and correspond to the Issuer regarding the “service of process”.

Members acting as trustee for PDS / Sukuk:

Interest Schemes

Interest Scheme is governed under Section 84 of the Companies Act 1965 and it involves the promotion of a particular scheme to the public who shall be the investors by contributing financially in exchange for an interest in the scheme. Investors do not have day-to-day control over the operations of the scheme. The operator of an interest scheme is required to comply with the provisions of the Companies Act 1965.

Generally, the role of the Trustee is to protect the interest of the public who invests in any approved interest scheme.

The interest schemes within Section 84 are:

more than 12 months golf club membership, recreational clubs and fitness clubs
time-sharing scheme
share-farming scheme or grower's plot scheme
offer to invest in breeding of livestock for commercial purpose
memorial parks
land banking scheme
property plots scheme

Members acting as trustee for Interest Schemes:

Interest

Escrow Services

An escrow service is an arrangement made between the trustee acting as the escrow agent and the primary contracting parties, for the trustee to hold and disburse money or documents or source code or other items at the appropriate time. Upon fulfilment of the conditions stated in the arrangement by either both or one of the primary contracting parties, the trustee shall hand over of the documents or items or disburse the money to the rightful party(ies) after receiving the appropriate written instructions.
The escrow agent has the duty to properly account for the escrow money and ensure that usage of money is explicitly for the purpose intended.

Members providing Escrow Services:

Escrow Services