Do you know that after setting up a company, you can change its form? Undoubtedly, choosing the type of business (Also see 7 Signs Your Business Needs To Hire Accounting Services) entity is crucial, and you may need a company registration service in Johor Bahru. However, when the business continues developing, some of the business owners may want to change the form of the company. According to the Companies Act 2016, unlimited companies can transform themselves into limited companies. Besides, private companies can change themselves to public companies or vice versa. In this article, we will focus more on the latter.

Private companies can change themselves to public companies through a special resolution. If a private company wants to do so, the documents that it needs to submit to the Registrar include a statement in lieu of prospectus, a notice of conversion as well as state a proper alteration to the company’s name. Besides, the private company needs to submit a statutory declaration which verifies that it has followed paragraph 190(2)(b) of the Companies Act 2016.

The opposite can occur too, which means that public companies can change to private companies. For a public company that has a share capital to convert itself into a private company, it needs to pass a special resolution. Then, it has to submit the notice of conversion to the Registrar as well as state a proper alteration to the company’s name.

As soon as the company submits the notice for conversion, according to the Companies Act 2016, the Registrar should make the change to or the endorsements in the register so that the company’s conversion is recorded. Also, the Registrar needs to issue a notice of conversion to the company (Also see Analysing the Equity of a Company) and cancel the company’s previous certificate of incorporation or notice of registration. After the Registrar issues the notice of conversion, the conversion should start to apply.

If a company (Also see Guidelines on Incorporating Local Companies) has changed its form, the conversion should not affect its rights, obligations or identity. Besides, this should not cause any legal proceedings that are against the company or those that the company has made to be defective. After the conversion, the legal proceedings that the company has started or continued using or those that act on it before its conversion should not cause any change in its name or capacity.