Directors Personally Liable Under the Copyright Act: What Section 43AA Means for Malaysian Companies

This is for you if you are a director, chief executive, manager or company secretary of a Malaysian company whose product hosts, transmits, embeds, links to or gives other people access to content. Software companies, app developers, hosting and platform businesses, media and IPTV operators, and anyone who sells or installs equipment that does any of it. Section 43AA of the Copyright Act 1987 creates an offence around streaming technology, and it does something that most Malaysian provisions do not do: it names the officers of the company by their job titles.

Where the company commits the offence, you are deemed guilty of the same offence and can be charged with the company or on your own, unless you prove you did not consent to it and that you exercised all due diligence to prevent it.

What follows is what the provision says and what it means for an officer. It is not advice on whether anything your company does is an offence. That question belongs to your own lawyer.

Key Facts: Section 43AA and Personal Liability for Directors

What does section 43AA make an offence? Committing or facilitating copyright infringement by making, importing, selling, distributing or advertising streaming technology, or by offering or providing a streaming technology service. It sits in a new Part VIAA of the Copyright Act 1987, inserted by the Copyright (Amendment) Act 2022 [Act A1645].

Who is personally exposed? Every director, chief executive officer, chief operating officer, secretary, manager and other similar officer of the company, and every partner in a firm. The provision also reaches anyone who was responsible for managing the affairs of the company, or assisting in that management, whatever their title.

What is the penalty? On conviction, a fine of not less than ten thousand ringgit and not more than two hundred thousand ringgit, or imprisonment for a term not exceeding twenty years, or both. The same penalty applies to the officer as to the company.

When did this come into force? The Copyright (Amendment) Act 2022 came into operation on 18 March 2022, except sections 4, 5, 6 and 10, which came into operation on 30 June 2022. The section inserting Part VIAA is not one of the excepted sections.

Is directors and officers insurance required in Malaysia? No statute requires a Malaysian company to carry directors and officers liability cover. Where the requirement exists it comes from an investor agreement, a shareholders agreement or a client contract, and it is contractual rather than statutory.

Last verified: August 2026. Checked against the text of the Copyright (Amendment) Act 2022 [Act A1645] and the consolidated reprint of the Copyright Act 1987 [Act 332], both published by MyIPO, with the commencement dates cross-checked against the WIPO Lex record for the same Act. Read the sources yourself before acting on any of it.

What section 43AA actually says about officers

The operative words are in subsection (3). They are worth reading in full before anyone summarises them for you.

"Where an offence under this section is committed by a body corporate or by a person who is a partner in a firm, every director, chief executive officer, chief operating officer, secretary, manager or other similar officer of the body corporate or every other partner in the firm or was purporting to act in any such capacity or was in any manner or to any extent responsible for the management of the affairs of the body corporate or firm or was assisting in such management, as the case may be, shall be deemed to be guilty of the offence and may be charged severally or jointly in the same proceedings with the body corporate or firm unless he proves that the offence was committed without his consent or connivance and that he exercised all due diligence to prevent the commission of the offence."

Source: section 43AA(3), Copyright Act 1987, as inserted by the Copyright (Amendment) Act 2022 [Act A1645], published by MyIPO.

The table below takes that sentence apart phrase by phrase, because each phrase decides something different.

The words in the provision	What they decide
"shall be deemed to be guilty of the offence"	Guilt of the officer follows from the company's offence. The prosecution does not have to prove the officer did anything.
"unless he proves"	The burden sits on the officer, not on the prosecution. This is the whole significance of the provision.
"without his consent or connivance"	The first limb of the defence. Not knowing is not the same as proving you did not consent.
"and that he exercised all due diligence"	The second limb, and it is cumulative. Both have to be proved, not one.
"may be charged severally or jointly"	An officer can be charged in the same proceedings as the company, or separately.
"or was in any manner or to any extent responsible for the management"	The reach is not limited to the named titles. A person running the business without one of those titles is inside it.

Who this reaches inside a normal Malaysian company

The named titles are the starting point, not the boundary. The provision adds three further categories: a person purporting to act in one of those capacities, a person responsible in any manner or to any extent for managing the affairs of the company, and a person assisting in that management.

This table sets out who that language picks up in a company of the size Contingent usually works with.

Role	Named in the provision?	Note
Executive and non-executive directors	Yes, "every director"	The provision draws no distinction between the two
Chief executive officer, chief operating officer	Yes, by title	Named separately from "director"
Company secretary	Yes, "secretary"	Includes an appointed external secretary acting in that capacity
Managers, including a product or engineering head	Yes, "manager or other similar officer"	Job title alone does not settle it. Responsibility for the affairs of the company does
A founder with no formal appointment who runs the business	Covered by the management limb	"Purporting to act in any such capacity" and the management limb both apply
Partners in a firm	Yes, "every other partner in the firm"	The provision covers partnerships as well as companies

If you are not certain which of your people sit inside that list, the useful test is not the org chart. It is whether the person was responsible, in any manner or to any extent, for managing the affairs of the company. Our note on which private companies actually need D&O cover works through the same question from the insurance side.

Why this reaches software businesses and not only device sellers

The reason is the definition. Subsection (4) defines streaming technology to include a computer program, device or component "which is used in part or in whole that results in an infringement of the copyright in a work". A computer program used in part is wider than a set-top box.

Separately, section 12 of the same amendment Act inserted a new paragraph into section 41(1) of the Copyright Act 1987, which covers a person who "provides or shares access to an online location of any works or copies of works to any other person without authority". Providing access to a location is a different act from copying the work.

Neither point tells you whether a specific product is an offence. Both tell you why a founder who assumed this provision was aimed at pirated television boxes should read it again.

The defence you have to prove, and what proving it looks like

You have to establish two things, not one: that the offence was committed without your consent or connivance, and that you exercised all due diligence to prevent it. The second is where most of the work sits, because due diligence is demonstrated with records rather than with recollection.

The table below contrasts what tends to exist inside a company with what a due diligence defence actually draws on.

What companies usually have	What a due diligence defence draws on
A verbal understanding that the team checks licensing	A written content and licensing policy with a date and an owner
Terms of service that prohibit infringing use	Evidence the prohibition is enforced, including takedown records and account actions
Board minutes that record financial matters only	Minutes showing the issue was raised, considered and acted on
An assumption that legal review happened at launch	The dated advice, and what was changed because of it
Nothing recorded from third party or reseller onboarding	Due diligence records on partners who distribute or integrate your product

Building that record is a governance job rather than an insurance one. Insurance becomes relevant at the next stage, which is who funds the lawyer while you prove it.

Which policy touches which part of this, and which part nothing touches

Start with the part that has no insurance answer. A fine imposed on conviction is a criminal penalty, and criminal fines and penalties are treated as uninsurable as a matter of public policy. No policy sold in Malaysia pays your fine, and any conversation that starts there has started in the wrong place.

The exposure that can be funded is the cost of defending yourself before any finding has been made. The table below separates the three things a company in this position tends to confuse, and names which policy is the relevant one for each.

What has happened	Who is exposed	The policy that is relevant
A criminal charge against an officer personally	The individual, in his own name	Directors and officers liability, and only for defence and investigation costs. Never for the fine
A civil claim by a copyright owner against the company	The company	Professional indemnity or technology errors and omissions, subject to the intellectual property terms in your own wording
A client claim that your product broke their business	The company	Professional indemnity for software companies
A fine on conviction	Whoever is convicted	None. This is not an insurable cost

Defence costs are worth naming plainly, because the structure of the exposure is unusual. Where a provision deems an officer guilty until he proves otherwise, that officer is paying for legal representation from the first day, before anything has been decided, and he is paying for it in a personal capacity rather than the company's. Our note on what a D&O policy actually covers goes through how those costs are paid and how they interact with the limit.

What to ask before you rely on a D&O policy for this

Do not assume the answer, in either direction. Whether a particular Malaysian D&O wording responds to a criminal prosecution, what happens to any advanced costs if there is a conviction, and how intellectual property matters are treated are all wording questions, and wordings differ between insurers and between policy years.

Put these five questions to your insurer in writing and keep the answer.

Question	Why it matters
Does the policy advance defence costs for a criminal prosecution of an individual officer?	This is the only part of the exposure that insurance can fund
What happens to costs already advanced if there is a conviction or an admission?	Wordings commonly require repayment in that event, and you should know before you need it
How does the wording treat intellectual property and copyright matters?	Intellectual property is often carved out, and the carve-out decides the answer
Do defence costs sit inside the limit or on top of it?	Where they erode the limit, a long defence reduces what remains for everything else
Who exactly is an insured person, and does that include a manager or a founder without an appointment?	The statutory provision reaches wider than most people expect, so the policy definition needs checking against it

If you are looking at this for the first time, our note on what drives the cost of D&O cover sets out the factors underwriters actually rate on.

The figures in this article, with sources and dates

Every number above traces to one of two documents published by the Intellectual Property Corporation of Malaysia. This table names each one.

Figure	Source	Date
Fine of not less than RM10,000 and not more than RM200,000, or imprisonment not exceeding 20 years, or both	Section 43AA(2), Copyright (Amendment) Act 2022 [Act A1645], MyIPO	Assented 26 January 2022, published 10 February 2022
Act A1645 came into operation on 18 March 2022, except sections 4, 5, 6 and 10, which came into operation on 30 June 2022	List of amendments, consolidated reprint of the Copyright Act 1987 [Act 332], MyIPO	Reprint as at 30 June 2022
Same commencement dates for Act A1645, from an independent record	WIPO Lex record for the Copyright Act 1987 [Act 332], Malaysia	Text stated as amended up to Act A1645, as at 30 June 2022
Part VIAA and section 43AA appear in the arrangement of sections of the consolidated Act	Consolidated reprint of the Copyright Act 1987 [Act 332], MyIPO	Reprint as at 30 June 2022
New paragraph 41(1)(k), inserted by section 12 of the amendment Act	Section 12, Copyright (Amendment) Act 2022 [Act A1645], MyIPO	Read 11 August 2026

One point on the commencement date, stated plainly so you can judge it yourself. Section 1(2) of the amendment Act leaves commencement to a notification by the Minister in the Gazette, and this article does not cite that individual gazette notification, because it was not obtained. The dates above are taken from the list of amendments printed in the Commissioner of Law Revision reprint of the Copyright Act 1987, and they match the record held by WIPO Lex for the same Act.

Both of those are records of the gazette notification rather than the notification itself. They are the official statute book and an international registry, not commentary, and two independent records agreeing is a reasonable basis to rely on. If the exact commencement date matters to a decision you are about to make, check the Gazette notification or ask your lawyer to, rather than relying on this page.

The same applies to everything else here. Statutes are amended, and a reprint is current only to its own date, which for the Act 332 reprint used above is 30 June 2022. Read the primary sources linked in the table for yourself before you act on any of it.

FAQ

Does section 43AA apply to a company that only links to content it does not host?

The amendment Act inserted a new paragraph 41(1)(k) of the Copyright Act 1987 covering a person who provides or shares access to an online location of works without authority, so providing access is addressed separately from copying. Whether any specific arrangement falls inside either provision is a legal question about your facts. Take it to a lawyer with the actual product in front of them.

Can the company indemnify me if I am charged personally?

That depends on your constitution, your service agreement and the general law on indemnifying officers, and it is a question for your company secretary and your lawyer. It is also worth asking early rather than at the point of charge. A company under investigation has its own interests to consider, and they are not always the same as yours.

Does D&O insurance pay the fine if I am convicted?

No. Criminal fines and penalties are treated as uninsurable as a matter of public policy, and no policy sold in Malaysia funds them. The part of the exposure insurance can address is the cost of legal defence and investigation before any finding is made, and even that depends on your wording.

I am a non-executive director. Does the provision treat me differently?

The wording says "every director" and draws no distinction between executive and non-executive. The defence is the same for both: proving the offence happened without your consent or connivance and that you exercised all due diligence to prevent it. For a non-executive, the records of what was put to the board and what the board did about it carry more weight.

We are a small company with no formal board minutes. Where do we start?

Start with the two things the defence needs evidence of: a dated written policy on content and licensing with a named owner, and a record that issues raised about it were considered and acted on. Neither requires a large governance function. Both are difficult to create retrospectively.

Is there an insurance requirement in the Copyright Act?

No. The Copyright Act 1987 imposes no insurance requirement of any kind, and neither does the Copyright (Amendment) Act 2022. Where a Malaysian company is required to hold directors and officers cover, that requirement comes from a contract, most often an investor or shareholders agreement.

Contingent Conclusion

The unusual thing about section 43AA is not the penalty. It is the direction the burden runs: the officer proves his own innocence, which means he is instructing and paying a lawyer from the first day, in his own name, before anything has been decided.

Two separate pieces of work follow from that, and they belong to different people. The governance work is building the record that a due diligence defence draws on. The insurance work is finding out, in writing, whether anything you hold funds a personal legal defence, and accepting that nothing will ever fund the fine.

Contingent helps Malaysian businesses get the cover their contracts and landlords require. Whether you're comparing options or checking whether your existing policy actually does what the contract asks, we can help.

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Further reading: professional indemnity for tech startups and digital companies, and insurance for content creators and content businesses.

Published by Contingent, the commercial insurance brand of Emerge Insurtech (Malaysia) Sdn. Bhd.

Disclaimer: This article provides general guidance based on publicly available regulatory information as of August 2026. Regulations may be amended. Always verify current requirements with the relevant authority or qualified professionals before making compliance decisions.