The Companies Commission of Malaysia (SSM) has announced that the Cross-Border Insolvency Act 2026 (Act 877) came into force on 28 August 2026. The Act, based on the UNCITRAL Model Law, governs insolvency cases spanning more than one country.

In general, the Act creates a formal process for Malaysian courts to recognise insolvency proceedings started overseas, and for Malaysian proceedings to get similar recognition and help abroad. It sets out who can apply to the court, what relief the court can grant, and how proceedings in different countries are coordinated so no creditor is treated unfairly.

Where a Malaysian company already faces an insolvency case overseas, its appointed liquidator or judicial manager is now formally authorised to act in that foreign country on the company's behalf.

On the other side, a foreign insolvency representative handling a company that also holds assets in Malaysia can now apply directly to the High Court here for recognition. Once recognised as the debtor's main proceeding, an automatic freeze applies to actions against, and transfers of, that company's property here, similar to a winding-up order. The representative may also seek relief such as taking over local asset administration or bringing clawback actions over past transactions, though local creditors below a set threshold must be paid before any local assets are sent overseas.

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