How to Appoint and Remove a Director of a Sdn Bhd in Malaysia

By Axecta Management Services, Kuala Lumpur · Last verified: 29 October 2026

The legal framework in brief

A change of director involves three layers: the Companies Act 2016.pdf), your company’s constitution, and any shareholders’ agreement. The Act sets the floor; the constitution can add requirements such as who nominates directors or how long a term lasts; a shareholders’ agreement may give a particular shareholder the right to nominate or veto. Read all three before you act, because the sequence and the approval can differ.

Ways a person becomes a director

Section 202.pdf) sets out the routes.

In a public company, a motion to appoint two or more directors by a single resolution cannot be made unless the meeting first agrees, with no vote against, that it may be (section 203).

How to appoint a director: step by step

1. Check eligibility. Age, residence and disqualification. See who can be a director in Malaysia.
2. Collect the consent and declaration. Section 201 prohibits appointing anyone who has not consented in writing and declared that they are not disqualified.
3. Collect particulars. The register of directors under section 57 holds name, residential address, service address, date of birth, business occupation and identification, plus details of other directorships of public companies and their subsidiaries.
4. Pass the right resolution. Members’ ordinary resolution (section 202(2)) or a Board resolution if the constitution lets the Board appoint (section 202(3)). A private company can use a written resolution; see written resolutions and directors’ vs shareholders’ resolutions.
5. Notify SSM within 14 days. Section 58(1) requires the company to notify the Registrar within 14 days after a person becomes a director. The notice must contain the new director’s particulars and be accompanied by the person’s consent (section 58(3)).
6. Update the registers (section 57) and the director’s shareholding register where relevant (section 59).
7. Update third parties: the bank, tax and licence records. See board resolution for a bank account.

About the SSM filing and Form 49

SSM’s Updating Company Information page lists “Notification of Change in Register of Director, Manager and Secretary (Seksyen 58)” as an update service on MyCoID 2016. SSM publishes the form as the Companies Act 2016 Section 58 notification, with sections for change of director particulars, new director and cessation as a director (along with equivalent sections for managers and secretaries). The form notes that only changes in the particulars affected need to be lodged and that the related resolution should be attached. It also notes that, for a company with a single director, you should check that no clause in the constitution contradicts the minimum number of directors.

Form 49 was the equivalent return under the Companies Act 1965; SSM’s Form 49 page cites section 141(6) of that older Act. Some SSM product pages still refer to Form 49 for historic director data. Under the 2016 Act the deadline is the 14 days in section 58. Where and how your company secretary files it (portal, fees) is an operational matter; ask them to confirm.

Ways a director leaves office

Section 208(1) lists when the office is vacated:

• resignation;
• retirement under the Act or constitution without re-election;
• removal under the Act or constitution;
• disqualification under section 198 or 199;
• unsoundness of mind or being dealt with under the Mental Health Act 2001;
• death; or
• otherwise under the constitution.

Retirement by rotation (public companies mainly)

Unless the constitution or terms of appointment say otherwise, section 205 provides that all directors of a public company retire at its first AGM, and at each later AGM one-third (or the number nearest to one-third) retire, starting with those longest in office. Retiring directors can be re-elected. A private company can use a written resolution under section 297 to determine retirement of a director.

Removing a director under section 206

Section 206(1)(a): in a private company, a director may be removed before the end of their period of office by ordinary resolution, subject to the constitution. Public companies follow section 206(2), which also allows removal by ordinary resolution at a meeting notwithstanding the constitution or any agreement.

Key procedural points

• Special notice. Section 206(3) requires special notice for a resolution to remove a director, or to appoint someone else in their place at the same meeting. Under section 322, special notice means notice of the intention to move the resolution must be given to the company at least 28 days before the meeting.
• Must be at a meeting. Section 297(2)(a).pdf) says a resolution under section 206 to remove a director cannot be passed as a written resolution. You must call a members’ meeting. See AGM vs EGM.
• Right to be heard. Under section 207, on receiving special notice the company must send the director a copy, and the director may make oral or written representations. For public companies this is mandatory; a private company’s constitution may provide the same rights.
• Nominee of a class. Section 206(4) delays removal of a public company director appointed to represent a class of shareholders or debenture holders until a successor is appointed.
• Compensation. Payments for loss of office to a director require disclosure and member approval (section 227). Take advice on any service contract.
• Other consequences. Removal does not cancel claims the director may have under a contract.

Resignation

A director resigns by giving written notice to the company at its registered office (section 208(2)); the notice takes effect when delivered, or on a later date stated in it (section 208(3)). Two limits matter.

• Minimum number. Section 196(3) says a director cannot resign if that would reduce the board below the minimum number, and a purported resignation is ineffective unless a replacement is appointed.
• Sole or last director. Under section 209(1), a sole or last remaining director must first call a meeting of members to receive the notice of resignation and appoint one or more new directors. This also applies where the sole director is the sole shareholder (section 209(2)).

Section 209(3) to (5) covers death or disqualification of the last director: the secretary must call a meeting of the next of kin, personal representatives or members as soon as practicable, and if no director is appointed within six months of death, the Registrar may direct the company to be struck off. Section 209(6) allows the committee appointed under the Mental Health Act 2001 to appoint a replacement where a sole director-shareholder is mentally incapacitated.

Removal and resignation compared

Illustrative scenario

A Sdn Bhd has three directors, two of whom also hold 80% of the shares. They want to replace the third, who rarely engages. The majority holders give written special notice of the intention to move the resolution, and the company calls an EGM at least 28 days later. The director is sent a copy of the notice and attends to give his views. The ordinary resolution passes, the company secretary files the section 58 notification within 14 days with the resolution attached, updates the register, and the company notifies the bank. Had the shareholders’ agreement given the third director a right to a board seat, the majority would first have needed to deal with that contract. This is illustrative; no real company is described.

Common mistakes

• Appointing a director without the signed consent and declaration.
• Trying to remove a director by circulating a written resolution, which section 297(2)(a) does not allow.
• Not allowing 28 days for special notice.
• Letting the only resident director resign without a replacement in place.
• Filing late. A failure under section 58 carries a fine of up to RM50,000 and up to RM500 for each day the offence continues after conviction.
• Forgetting the bank mandate, the tax record or the licence holder details after the change.
• Treating the Act as the only source and missing the constitution or shareholders’ agreement.

What this means for your type of company

• One-director company: to change your only director you must appoint the new person effectively before you leave, because of sections 196(3) and 209.
• Foreign-owned company: keep the resident director in mind when planning any exit. See bank account opening for foreign-owned Sdn Bhd.
• Company with a new secretary at the same time: align the filings; see changing a company secretary.

How Axecta helps

Our company secretarial service prepares the consents, resolutions, notices and the section 58 notification, updates the statutory registers and keeps the filing evidence. We also coordinate the bank mandate change with your signatories.

Next steps

1. Read the constitution and shareholders’ agreement.
2. Confirm eligibility and gather the consent and particulars.
3. Decide the route: ordinary resolution, Board appointment or removal meeting.
4. Diary the 14-day notification date.
5. Update the registers and every third party record.

Frequently asked questions