What section 223 requires
Section 223(1) of the Companies Act 2016prohibits the directors of a company from entering into any arrangement or transaction to acquire an undertaking or property of a substantial value, or to dispose of a substantial portion of the company's undertaking or property, unless the entering into the arrangement or transaction has been approved by the shareholders in a general meeting.
What "substantial value" means
Section 223(2) defines the threshold by reference to three alternative metrics. A transaction is "substantial" if the value of the property or undertaking exceeds any one of:
- 25% of the total assets of the company;
- 25% of the net profits of the company (after deducting all charges except taxation); or
- 25% of the issued share capital of the company.
The 25% test is generous in scope, many transactions that look routine fall within it once measured properly.
Consequence of breach
Section 223(3) provides that any arrangement or transaction entered into in contravention of section 223 is voidable at the option of the company, except as against any person who has acted in good faith for valuable consideration and without notice of the breach. Directors who knowingly authorise the transaction can also be held personally liable for losses suffered by the company.
How approval is given
- Ordinary resolution at a general meeting is the default, section 291 confirms ordinary resolution requires a simple majority of votes cast.
- Written resolution is available for private companies under sections 297 to 308, with the same simple-majority threshold.
- Disclosure to shareholders. Although section 223 itself does not specify the contents of the explanatory note, best practice is to provide shareholders with a clear summary of the transaction, the consideration, the rationale, and any director conflicts.
Cross-references and overlapping requirements
- Section 85 pre-emption. If the consideration involves the issue of new shares, section 85 pre-emption rights may also apply, and a single resolution can be drafted to satisfy both requirements.
- Section 221/222 disclosure and voting. If a director has an interest in the transaction, the director must disclose and is excluded from board voting on the proposal.
- Listed companies.Bursa Listing Requirements add separate thresholds and shareholder-approval rules for related-party and non-related-party transactions, often at lower percentage thresholds than section 223's 25%.
Practical points
- Test all three metrics, not the convenient one. If any one of total assets, net profits, or issued share capital exceeds 25%, the transaction is caught.
- Aggregation. Where a series of transactions with the same counterparty would together exceed the threshold, courts have been alert to artificial fragmentation.
- Substance over form.A "lease" with a built-in transfer of beneficial ownership can be treated as a disposal for section 223 purposes.
If you are planning a sale or acquisition of a substantial company asset, or you are unsure whether section 223 thresholds are engaged, please contact us before the transaction documents are exchanged.
第 223 条之要求
《2016 年公司法令》第 223(1) 条禁止董事订立任何安排或交易，以收购重大价值之业务或财产，或处置公司业务或财产之重大部分，除非该安排或交易已在股东大会上经股东批准。
「重大价值」如何认定
第 223(2) 条以三项替代性指标设定门槛。任何一项满足即构成「重大」：
- 该财产或业务之价值超过公司总资产之 25%；
- 超过公司净利润之 25%（扣除除税项外之所有费用后）；或
- 超过公司已发行股本之 25%。
25% 之测试范围相当宽，许多看似常规的交易，按规则量度后，均落入其中。
违反之后果
第 223(3) 条规定：任何违反第 223 条订立之安排或交易，公司可选择宣告无效，但不得对抗善意、以有偿对价、且对违反不知情之人。明知而批准交易之董事，亦可能就公司之损失承担个人责任。
如何取得批准
- 股东大会之普通决议为默认，第 291 条确认普通决议须经所投表决之简单多数通过。
- 书面决议对私人公司可用，依第 297 至 308 条，同样以简单多数为门槛。
- 向股东披露。虽第 223 条本身未指定说明函内容，最佳实务是向股东提供交易摘要、对价、理据，以及任何董事利益冲突之清晰说明。
交叉与重叠要求
- 第 85 条优先认购权。若对价涉及新股发行，第 85 条之优先认购权可能并行适用，可起草一份决议同时满足两项要求。
- 第 221／222 条披露与表决。若董事就交易有利益冲突，须申报，并被排除于该提案之董事会表决与法定人数之外。
- 上市公司。Bursa 上市规则就关联交易与非关联交易，叠加独立门槛与股东批准规定，门槛通常低于第 223 条之 25%。
实务要点
- 三项指标均须测试，而非择易。总资产、净利润、或已发行股本任一超过 25%，交易即落入其中。
- 合并计算。同一对方之系列交易合计超过门槛者，法院对人为拆分保持警觉。
- 实质重于形式。带有受益所有权转移之「租赁」安排，可被视为第 223 条意义上之处置。
若您正计划出售或收购公司之重大资产，或不确定第 223 条之门槛是否被触发，请在交易文件交换之前与本所联系。