How to Remove a Director in Malaysia 2026, Companies Act 2016 S.206, 28‑day Special Notice, EGM & SSM Filing

Last reviewed: 27 July 2026

Understanding how to remove a director in Malaysia is essential for company secretaries, in-house counsel and shareholders who need to act decisively while staying within the law. The Companies Act 2016 (Act 777), specifically section 206, grants shareholders the power to remove any director by ordinary resolution, but only after following a strict procedural sequence that includes a 28-day special notice, a properly convened general meeting and a timely filing with the Companies Commission of Malaysia (SSM). Failure at any stage can expose the company to injunctions, costs and declarations of invalidity. This guide walks through every step, provides sample templates and maps the SSM filing requirements clarified by Practice Note No. 9/2024 (PN9/2024).

The Four-Step Overview

1. Review the constitution. Check the company’s constitution, shareholders’ agreements and any director service agreements for entrenched rights or heightened voting thresholds (s.206 CA2016).
2. Issue a 28-day special notice. A shareholder proposing removal must give special notice to the company not less than 28 days before the meeting at which the resolution will be moved (s.206(3) read with s.322 CA2016). The company must then send a copy to the director concerned.
3. Convene the meeting and hear the director. Call an extraordinary general meeting (EGM) or place the resolution on the agenda of the next general meeting. The director is entitled to attend and be heard (s.206 CA2016).
4. File with SSM within 14 days. Lodge the notification of cessation using the prescribed form, accompanied by an extract of the resolution signed by the chairman, as required by s.58 CA2016 and SSM PN9/2024.

Statutory Basis: Section 206 Companies Act 2016 and Related Provisions

The power of shareholders to remove directors is rooted in section 206(1) of the Companies Act 2016. That subsection provides that a company may, by ordinary resolution, remove a director before the expiration of the director’s period of office, regardless of anything in the company’s constitution or any agreement between the company and the director. This is a mandatory, non-excludable right.

Three related provisions complete the statutory framework:

• Section 206(3) & section 322, special notice. A resolution to remove a director requires “special notice” of not less than 28 days. The company must promptly send a copy of the special notice to the director named in it.
• Section 206(4), director’s right to be heard. The director is entitled to be heard at the meeting on the resolution, and may submit written representations to the company for circulation to members.
• Section 58, notification to SSM. Once a director ceases to hold office, the company must notify SSM within 14 days. SSM PN9/2024 clarifies that an extract of the resolution, signed by the chairman of the meeting, must accompany this notification.

These provisions apply to every company incorporated under the Act, whether private (Sdn Bhd) or public (Berhad), subject to the additional governance obligations discussed below for listed entities involved in M&A or corporate restructuring.

Step 1, Review the Company Constitution and Contractual Protections

Before issuing any notice, the proposing shareholder should conduct a careful documentary review. While section 206 overrides constitutional restrictions on the power to remove, the constitution and related agreements can affect how removal is executed and what consequences follow.

Key documents to review:

• Company constitution (or Table A default articles). Check for weighted-voting clauses, special quorum requirements or nominee-director provisions that could complicate the resolution.
• Shareholders’ agreements. These may contain board-composition clauses, deadlock mechanisms or consent rights that, while they cannot prevent a s.206 removal, may trigger breach-of-contract claims if ignored.
• Director service agreements. A director who is removed under s.206 retains the right to claim damages for breach of any service contract. The removal does not automatically terminate contractual obligations owed by the company.
• Special share classes. If any class of shares carries enhanced voting rights on director-appointment matters, calculate whether the proposing shareholders hold enough votes to pass an ordinary resolution (more than 50 per cent of votes cast).

Practical tip: If the constitution imposes a higher threshold than a simple majority, for example, a 75 per cent special resolution, confirm with legal counsel whether that clause is enforceable in light of s.206(1)’s override. Industry observers expect courts to uphold the statutory override, but the interplay between constitution and statute remains a frequent source of disputes, particularly in joint-venture companies with foreign participation and bespoke commercial contract structures.

Step 2, How to Draft and Serve the 28-Day Special Notice

Who Must Serve the Special Notice

The special notice is given by the shareholder who intends to move the removal resolution. It must be served on the company, not directly on the director at this stage. Once the company receives the notice, it is the company’s obligation to send a copy to the director concerned without delay. This two-stage service requirement is mandated by section 206(3) read together with section 322 of the Companies Act 2016.

The 28-day period is counted backwards from the date of the meeting. If the EGM is scheduled for 15 September 2026, the company must have received the special notice no later than 18 August 2026.

Sample Special Notice, Format and Checklist

The special notice for removal of director format in Malaysia should contain the following elements:

Evidence of Service and Best Practice

To minimise the risk of challenge, serve the notice by registered post and email (if the company’s constitution or standing practice permits electronic communication). Retain the postal receipt and delivery confirmation. If hand-delivered, obtain a signed acknowledgement from the company secretary with the date and time of receipt stamped on the face of the document.

Can a director be removed without notice? No. The 28-day special notice is a statutory prerequisite under section 206(3) of the Companies Act 2016. Any resolution passed without proper special notice is voidable and may be set aside by the court.

Step 3, Calling and Running the General Meeting

Meeting Notice and Quorum

After receiving the special notice, the board, or the shareholders themselves, if the board refuses, must convene a general meeting. For a private company (Sdn Bhd), members holding at least 10 per cent of the total voting rights may requisition a meeting under section 310 of the Companies Act 2016 if the board is uncooperative.

The meeting notice must comply with the standard notice period set out in the constitution or, in the absence of a specific provision, the default 14-day notice period for an EGM under the Act. The notice should clearly state that a resolution for the removal of the named director will be considered.

Quorum is determined by the company’s constitution. Where the constitution is silent, the default quorum for a private company is two members personally present.

Voting Mechanics

The removal resolution is an ordinary resolution: it requires a simple majority of more than 50 per cent of the votes cast by members entitled to vote. Voting may be by show of hands or by poll. Where the outcome is expected to be close, any member may demand a poll under section 330 of the Act to ensure that each share’s voting weight is counted.

Critically, written resolutions cannot be used to circumvent the meeting requirement for removal. The director’s statutory right to attend and be heard at the meeting means the process must take place at an actual meeting, whether physical or virtual (if the constitution permits virtual meetings).

Director’s Right to Attend and Be Heard

Section 206(4) entitles the director to attend the general meeting and to speak on the resolution. The company must give the director reasonable notice of the meeting date, time and venue. Denying this right is one of the most common grounds on which removal resolutions are challenged, and courts have consistently treated it as a mandatory procedural safeguard.

Step 4, Director’s Right to Make Representations

Hearing Process and Minutes

Beyond the right to speak at the meeting, the director may submit written representations to the company and request that they be circulated to all members before the vote. The company is obliged to circulate these representations unless they are received too late for circulation or the court, on the company’s application, determines that the right is being abused to secure needless publicity for defamatory material.

Minutes of the meeting must record:

• That the director was given notice of the meeting and the proposed resolution
• Whether the director attended or was represented
• A summary of any oral representations made
• Whether written representations were received and circulated
• The voting result (by show of hands or poll, including the exact count if a poll was demanded)

Handling Written Representations

If the director submits written representations, the company secretary should circulate them to every member entitled to attend the meeting at the same time as, or before, the meeting notice. Keep a record of the circulation method and date. Failure to circulate representations is a procedural defect that may render the removal vulnerable to challenge.

Adjournments and Delays

The director may request an adjournment to prepare representations, or to obtain legal advice. While the chairman has discretion on adjournments, unreasonably refusing an adjournment, particularly where the director has had no realistic opportunity to prepare, can be treated as a denial of the right to be heard. Conversely, a director cannot use repeated adjournment requests as a delaying tactic. Industry observers suggest that one reasonable adjournment of seven to fourteen days is generally defensible; granting more may expose the company to allegations of bad faith from the proposing shareholder.

Passing the Resolution and Drafting the Extract of Resolution

Once the vote is taken and the ordinary resolution is passed, the chairman must declare the result and the company secretary must prepare two key documents:

Sample ordinary resolution wording:

“RESOLVED THAT pursuant to section 206 of the Companies Act 2016, [Full Name of Director], NRIC No. [●], be and is hereby removed from office as a director of the Company with immediate effect from the conclusion of this meeting.”

The extract of resolution, required by SSM PN9/2024 to accompany the cessation notification, is a certified copy of the resolution for removal of director in a private company or public company. It must be signed by the chairman of the meeting and should include the company name, registration number, date of meeting, the full text of the resolution and the voting result.

This extract is a distinct document from the full minutes. SSM PN9/2024 specifically requires it as a supporting attachment; submitting the full minutes alone does not satisfy the requirement.

Post-Meeting SSM Filing: Timeline and Required Documents

Form 49, What to Attach

The SSM removal of director notification is lodged through the prescribed statutory return (commonly referred to as Form 49, or the equivalent electronic filing on the MyCoID 2016 portal). The filing must include:

• Completed return stating the full name, NRIC/passport number, residential address and date of cessation of the director
• Extract of resolution, signed by the chairman, as specified by SSM PN9/2024
• Copy of the special notice served under section 322 (recommended, though not expressly mandated by PN9/2024, to evidence procedural compliance)

Timing and Penalties for Late Filing

Section 58 of the Companies Act 2016 requires notification within 14 days of the director’s cessation. Late filing is an offence and may attract compound penalties imposed by SSM. Beyond the statutory penalty, a delayed filing leaves the removed director on the company’s public register, which can create confusion with banks, counterparties and regulatory authorities, a particular concern for businesses navigating conveyancing transactions or hire-purchase compliance obligations where director details are verified against SSM records.

Special Scenarios and Pitfalls

Director Who Is Also a Shareholder, Practical Voting Traps

A frequently asked question is: how do you remove a director who is also a shareholder in Malaysia? The answer turns on voting control. Section 206 does not prohibit a director-shareholder from voting their own shares on the removal resolution. If the director holds more than 50 per cent of the voting shares, the resolution will fail on a poll, the shareholder majority needed simply does not exist.

Practical options where the director-shareholder controls a blocking vote include:

• Negotiate a voluntary resignation in exchange for agreed terms (buyout, consultancy arrangement or settlement)
• Rely on shareholders’ agreement provisions that may require the director to vote in favour of removal in specified circumstances (breach, incapacity, conviction)
• Petition the court under section 346 (oppression) or section 351 (just and equitable winding up) if the director-shareholder’s conduct is unfairly prejudicial to other members

When Removal Is Actionable, Wrongful Removal Remedies

If a director is removed without proper special notice, without an opportunity to be heard, or in breach of the company’s constitution, the removal may be challenged in court. Available remedies include:

• Injunction, restraining the company from acting on the resolution or from filing the cessation with SSM
• Declaration of invalidity, the court declares the resolution void and reinstates the director
• Damages, for breach of a director’s service agreement, separate from the statutory removal
• Costs, a successful challenge typically results in indemnity or solicitor-client costs against the company

The removal of a director from a public company carries additional risks. Listed companies must comply with Bursa Malaysia Listing Requirements, which impose disclosure obligations and may trigger regulatory scrutiny. For governance-sensitive transactions, obtaining early legal advice is critical, particularly where the removal intersects with ongoing commercial or maritime disputes.

Comparison Table, Private vs Public Company Director Removal

Conclusion, Tactical Checklist

Knowing how to remove a director in Malaysia requires careful attention to statutory procedure at every stage. Use this checklist to stay on track:

1. Review the constitution, shareholders’ agreement and service contracts
2. Prepare and serve the 28-day special notice on the company
3. Ensure the company forwards the notice to the director without delay
4. Convene the EGM with proper notice, quorum and agenda
5. Allow the director to attend, speak and submit written representations
6. Pass the ordinary resolution and prepare the extract of resolution
7. File with SSM within 14 days, attaching the signed extract of resolution
8. Address any contractual claims arising from the director’s service agreement

For tailored advice on director removal, shareholder disputes or SSM compliance, consult an experienced Commercial Transactions lawyer in Malaysia.

Sources

1. Companies Commission of Malaysia (SSM), Companies Act 2016
2. Companies Act 2016 (Act 777), Official SSM Reprint
3. SSM Practice Note No. 9/2024
4. SSM, Form 49 Guidance
5. Laws of Malaysia, Companies Act 2016 Reprint (MOF)
6. IJPS / Universiti Malaya, Removal of Company Directors in Malaysia