29 October 2020
On 1 October 2020, the Malaysia Currency Act 2020 (“Act”) came into operation. The Act provides for the management of the currency of Malaysia by Bank Negara Malaysia (“BNM”), regulation of currency processing business and currency processing activities and for related matters.
The key provisions of the Act include the following:
- BNM is prescribed as the sole authority to issue currency in Malaysia, and that currency can only be printed or minted by or under the authority of BNM.
- BNM may call in any currency by giving not less than one month’s notice in the Federal Gazette. Upon the expiration of the notice, the currency will cease to be legal tender.
- It is an offence for any person to issue, print or mint or authorise the issuance, printing or minting of, any note, coin, token, document or instrument, whether tangible or intangible, which is likely to pass as legal tender unless the note, coin, token, document or instrument is denominated in and fully backed by ringgit or foreign currency. Any person who contravenes this provision upon conviction would be liable to a fine not exceeding RM50 million and/or imprisonment for a term not exceeding ten years.
- It is an offence to melt coins with the intention to make profit, unless authorised by BNM.
- The Act introduces a registration regime for currency processing businesses, duties of a registered currency processor and powers of BNM to examine matters relating to the currency processing business.