Nominee Shareholder: A Strategic Corporate Ownership Arrangement

A Nominee Shareholder in Malaysia is an individual or corporate entity holding company shares on behalf of the owner. Their primary responsibility is to ensure the owner’s anonymity and privacy. This arrangement is legal and commonly used in Malaysia to maintain the confidentiality of the beneficial owners of shares.

 

Roles and Responsibilities

The primary role of a nominee shareholder is to appear in public records as the holder of shares, while the real owner retains control over the shares, including voting rights and investment returns. The nominee acts under a declaration of trust, where they acknowledge that they are holding the shares for the benefit of another party.

 

Legal Framework and Agreement

In Malaysia, the relationship between a nominee shareholder and the beneficial owner is governed by a nominee agreement. This agreement outlines the nominee’s duties, which include acting on the beneficial owner’s instructions and maintaining confidentiality. It must be well-documented to prevent legal disputes.

Nominee shareholders play a pivotal role in the Malaysian corporate landscape, offering a layer of privacy for investors. While this arrangement offers benefits like confidentiality and asset protection, it also requires trust and transparency between the nominee and the beneficial owner.