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Offer of Securities / Sukuk
Securities means any investments commonly known or capable of being described as securities as defined under the Labuan Financial Services and Securities Act 2010 (LFSSA) and Labuan Islamic Financial Services and Securities Act 2010 (LIFSSA), which includes:
  1. shares, debentures, funds, units or interests in a limited partnership, limited liability partnership, unit trust, foundation, protected cell company or corporation
  2. debentures, bonds or notes of or issued by any body (incorporated or unincorporated), government, local government or public authority
  3. certificates of interest or participation in, temporary or interim certificates for, receipts for, or warrants to subscribe to or purchase any of the investments described under items (a) and (b) above; and
  4. securities as defined under the LFSSA.

For Islamic securities, in addition to items (a), (b) and (c) above, those which are issued are expressly to be in compliance with Shariah principles, including sukuk.

Debenture includes debenture stocks, bonds, notes and any other evidence of indebtedness of a corporation for borrowed monies, whether or not constituting a charge on the assets of the corporation as defined under Section 2 of the LFSSA.

Sukuk includes any certificates, instruments, notes and any other evidence of payment obligations of a corporation, body (incorporated or unincorporated), government, local government or public authority pursuant to any form of financing in accordance with Shariah principles, whether or not constituting a charge on the assets of the corporation, body (incorporated or unincorporated), government, local government or public authority as defined under Section 2 of the LIFSSA.
Eligible Issuers
Any person, via the establishment or registration of a Labuan company or foreign Labuan company under the Labuan Companies Act 1990 (LCA), may make an offer or invitation to subscribe for securities in or from within Labuan IBFC.
Approval Requirements
  1. Any person who makes an offer for subscription or purchase, or issues an invitation to subscribe for or purchase securities in or from within Labuan IBFC, must obtain the approval from Labuan FSA under Section 8(1) of the LFSSA and Section 13(1) of the LIFSSA, unless the offers or invitations of securities are excluded from the approval requirements of Labuan FSA as specified under Section 8(5) of the LFSSA or Section 13(5) of the LIFSSA.
  2. In relation to sukuk, the endorsement of a Shariah adviser must be obtained apart from the approval requirements from Labuan FSA prior to the offer for subscription or purchase, or issue of invitation to subscribe for or purchase sukuk in or from within Labuan IBFC.
Exclusion of Approval
  1. The following offers or invitations of securities are excluded from the requirement to obtain approval from Labuan FSA:
  2. For an offer or invitation of securities, where:
    • the offer or invitation is addressed to an identifiable category of persons to whom it is directly communicated by the person making the offer or invitation or by his appointed agent and the number of persons to whom the offer or invitation is communicated does not exceed fifty (50); or
    • the members of that category to which the offer or invitation is made are the only persons who may accept the offer or invitation and they are in possession of sufficient information to be able to make a reasonable evaluation of the offer or invitation and the number of persons to whom the offer or invitation is communicated does not exceed fifty (50).
  3. For an offer or invitation of debentures or sukuk, where:
    • the first-time investment of each of the initial debenture or sukuk holders is not less than RM250,000 or its equivalent in any other currency and they are in possession of sufficient information to be able to make a reasonable evaluation of the offer or invitation; or
    • the first-time investment of each of the initial debenture or sukuk holders is less than RM250,000 or its equivalent in any other currency and the number of persons to whom the offer or invitation is communicated does not exceed fifty (50) and they are in possession of sufficient information to be able to make a reasonable evaluation of the offer or invitation.
  4. An offer or invitation of securities in a mutual fund or Islamic mutual fund which satisfies the mutual fund or Islamic mutual fund requirements under Part III of the LFSSA or Part IV of the LIFSSA.
  5. An offer or invitation of securities pursuant to a take-over offer which complies with the relevant law applicable to such offer.
  6. An offer or invitation of securities or such classes or categories of securities as may be specified by Labuan FSA.
Eligible Investors
  • Any person may subscribe to the securities issued in or from within Labuan IBFC.
  • Residents of Malaysia may subscribe to the securities issued, subject to permission under the Capital Markets and Services Act 2007 and any other rules and regulations applicable domestically, or necessary approval has been obtained from the Securities Commission of Malaysia or other relevant regulatory bodies.
Eligible Agents
  • An issue, offer or invitation shall be made through its agent which shall be either a Labuan trust company or a Labuan bank licensee.
  • An issue, offer or invitation to subscribe for debentures or sukuk to residents of Malaysia must be made by a Labuan bank licensee.
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