In Jet-Tech Materials Sdn Bhd & Anor v Yushiro Chemical Industry Co Ltd & Ors and another appeal [2013] 2 MLJ 297 (“Jet-Tech”), the Federal Court was of the view that “breaches of a shareholders agreement cannot be a basis for bringing a petition under s 181”[1] as “a complaint under s 181 of the CA must be confined to matters relating to the affairs of the company”[2] and “shareholders’ agreement and breach of the same clearly are not matters relating to the affairs of the company.”[3]
Section 181 of the Companies Act 1965 governed remedy in cases of an oppression and has been replaced by Section 346 of the Companies Act 2016.[4]
The correctness of the legal proposition laid down in Jet-Tech was recently revisited by the Federal Court in ISM Sendirian Bhd v Queensway Nominees (Asing) Sdn Bhd & Ors and another appeal [2026] 4 MLJ 83 (“ISM”).
The Appellant in ISM obtained leave to appeal to the Federal Court, inter alia, on the following question of law:
“Question 2:
Whether the proposition espoused by the Federal Court in Jet-Tech Materials Sdn Bhd & Anor v Yushiro Chemical Industry Co Ltd & Ors and another appeal [2013] 2 MLJ 297; [2013] 2 CLJ 277 at para 37 of the reported judgment that ‘breaches of a shareholders’ agreement cannot be a basis for bringing a petition under s 181. A complaint under s 181 of the CA must be confined to matters relating to the affairs of the company. Shareholders’ agreement and breach of the same clearly not matters relating to the affairs of the company. They are private matters enforceable by the parties to the shareholders’ agreement …’ is correct in law by reference to the following authorities:
(i) Ho Yew Kong v Sakae Holdings Ltd [2018] SGCA 33;
(ii) Gue See Sew & Ors v Heng Tang Hai & Ors [2020] MLJU 46; and
(iii) Teh Wei Kian & Anor v Golden Plus Holdings Berhad & Ors [2020] MLJU 1050.”[5]
The Federal Court in ISM held the following, and upheld the decision of the Federal Court in Jet-Tech:
“In the circumstances, we find the principle of law in para 37 of the Jet-Tech’s case is correct, and the Federal Court’s finding or decision was based on the factual matrix of the case. Therefore, the answer to Question 2 is in the affirmative.”[6]
[1] Jet-Tech Materials Sdn Bhd & Anor v Yushiro Chemical Industry Co Ltd & Ors and another appeal [2013] 2 MLJ 297 (FC), at para 37.
[2] Ibid.
[3] Ibid.
[4] For further information on minority oppression claims, see https://pelim.my/6-things-about-minority-oppression/.
[5] ISM Sendirian Bhd v Queensway Nominees (Asing) Sdn Bhd & Ors and another appeal [2026] 4 MLJ 83 (FC), at para 3.
[6] ISM Sendirian Bhd v Queensway Nominees (Asing) Sdn Bhd & Ors and another appeal [2026] 4 MLJ 83 (FC), at para 79. See also para 102.