Yousuf Sultan is a Certified Shariah Advisor and Auditor (CSAA) from Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), Bahrain and an AAOIFI Master Trainer

Disclosure Statement | Ethis Malaysia

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<h1 class="font-semibold section-title title-dark font-Inter">Disclosure Statement</h1>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Overview</p>
<p class="font-normal text-base text-wm_para_t py-2">This Disclosure Statement has been prepared by Ethis Ventures Sdn Bhd (“Ethis”). We are licensed and regulated by the Securities Commission Malaysia (“SC”) for the operating of our Equity Crowdfunding platform (“ECF Platform”).</p>
<p class="font-normal text-base text-wm_para_t py-2">This Disclosure Statement must be read together with our Terms and Conditions of use and any other documents referred to therein as it explains your rights and obligations is using or accessing the ECF Platform. You are strongly advised to read through the Issuer Disclosure Statement and thus by using or accessing the ECF Platform, it shall be deemed as acceptance of this Issuer Disclosure Statement.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Warning Statement</p>
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<li>Equity Crowdfunding (“ECF”) financing carries a high risk.</li>
<li>Issuers using this ECF Platform to raise funds are usually start-ups or small or medium sized companies. Hence, investments in these types of businesses are highly speculative and carry a high risk.</li>
<li>You must be prepared to bear all the risks of losing your entire investment.</li>
<li>You are advised to diversify your investments to reduce your overall risk.</li>
<li>You are advised to do your own research and evaluate, or seek independent advice to assess the merits and risks of an investment before committing to the investment.</li>
<li>You are advised to read all the information and documents carefully and do your own research before committing yourself to an investment.</li>
<li>Neither the offering being made on the ECF Platform nor the registration of the ECF Platform with SC, is to be taken as an indication of the merits of the offering.</li>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Services</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis is offering ECF financing opportunities whereby Issuers may raise funds on the ECF Platform. The terms in which Ethis provides its financing services are set out in the following documents, which are available on the ECF Platform as follows:–</p>
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<li>Terms and Conditions</li>
<li>Privacy Policy</li>
<li>Risk Statement</li>
<li>Investor Agreement</li>
<li>Disclosure Statement</li>
<li>Issuer Agreement</li>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Eligibility Criteria For Investors</p>
<p class="font-normal text-base text-wm_para_t py-2">Investors must:-</p>
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<li>Be 18 years of age or older at the time of registering as an Investor (if the person is an individual);</li>
<li>Declare whether they are subject to any investment limit (Retail Investor’s investment limit is at RM50,000 within a 12-month period and Angel Investor’s investment limit is at RM500,000 within a 12-month period);</li>
<li>Be an individual, limited liability partnership (LLP), public body or other legal entity;</li>
<li>If investing in his/her own capacity as an individual, Investor must have a permanent address in Malaysia;</li>
<li>If Investor is a limited company, Investor must be incorporated under the laws of Malaysia under the Companies Act 1965 or under the Companies Act 2016, whichever is applicable, and having the permanent place of business in Malaysia;</li>
<li>If Investor is a LLP, Investor must have a permanent place of business in Malaysia;</li>
<li>If Investor is a public body, Investor must be registered or formed with the relevant authorities in Malaysia;</li>
<li>Provide a MBAN number if the Investor is an Angel Investor;</li>
<li>Acknowledge that they have read and accepted the Warning Statement, Disclosure Statement, Terms and Conditions and Privacy Policy.</li>
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<p class="font-normal text-base text-wm_para_t py-2">Ethis’ services and its ECF Platform are designed for persons who are residents in Malaysia. An Investor who wishes to fund a Campaign from outside of Malaysia or who is not a Malaysian citizen is solely responsible for ensuring their compliance with all relevant laws of any country outside of Malaysia.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">General Principle</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis will not process personal data unless it obtains your consent or it is deemed necessary to:-</p>
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<li>perform a contract between the relevant parties;</li>
<li>address a request by you;</li>
<li>comply with legal obligations;</li>
<li>protect your vital interests; or</li>
<li>justice administration.</li>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">How Do Potential Issuers Apply For Access To Ethis’ Services?</p>
<p class="font-normal text-base text-wm_para_t py-2">Only locally registered sole proprietorships, partnerships, incorporated LLPs, private limited and unlisted public companies are eligible to become Issuers.</p>
<p class="font-normal text-base text-wm_para_t py-2">Based on the SC guidelines, the following entities are prohibited from raising funds through the ECF Platform:-</p>
<p class="font-normal text-base text-wm_para_t py-2">(a) Commercially of financially complex structures (i.e. investment fund companies or financial institutions);</p>
<p class="font-normal text-base text-wm_para_t py-2">(b) Public-listed companies and their subsidiaries;</p>
<p class="font-normal text-base text-wm_para_t py-2">(c) Companies with no specific business plan or its business plan is to merge or acquire an unidentified entity (i.e. blind pool);</p>
<p class="font-normal text-base text-wm_para_t py-2">(d) Companies other than a microfund that proposes to use the funds raised to provide loans or make investments in other entities</p>
<p class="font-normal text-base text-wm_para_t py-2">(e) Companies other than a microfund with paid-up share capital exceeding RM10,000,000; and</p>
<p class="font-normal text-base text-wm_para_t py-2">(f) Any other type of entity that is specified by SC.</p>
<p class="font-normal text-base text-wm_para_t py-2">An Issuer must not be hosting the same Campaign concurrently on another ECF platform.</p>
<p class="font-normal text-base text-wm_para_t py-2">Any company wishing to access the ECF Platform as an Issuer must be a registered member in which the process is as explained above.</p>
<p class="font-normal text-base text-wm_para_t py-2">An Issuer proposing to be hosted on the ECF Platform must ensure that all information submitted or disclosed to Ethis is true and accurate and must not contain any information or statement that is false or misleading or from which there is a material omission.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">How Do Potential Investors Apply For Access To Ethis’ Services?</p>
<p class="font-normal text-base text-wm_para_t py-2">Any person wishing to become an Investor and use Ethis’ services provided on the ECF Platform must first complete the registration process. By clicking Sign Up or Join Us, you will be directed to a registration page which requires you to fill in your details such as a username and your password. It is your responsibility to maintain the confidentiality of your password. You may be required to verify your email by clicking the link sent to your email.</p>
<p class="font-normal text-base text-wm_para_t py-2">Once the person has registered with Ethis, the person will be able to view all Campaigns on the ECF Platform but with limited access unless the person registers with Ethis as an Investor and agrees to the terms of the Investor Agreement.</p>
<p class="font-normal text-base text-wm_para_t py-2">To register as an Investor on the ECF Platform, the person must be a registered member, and provide necessary details about themselves. For the purposes of compliance with the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001, Ethis is required to collect information from Investors in relation to the identity of the individuals and other relevant persons, and information in relation to the source of funds of the Investors.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Screening and Assessment Process</p>
<p class="font-normal text-base text-wm_para_t py-2">FIRST LEVEL OF SCREENING – Credit Scoring</p>
<p class="font-normal text-base text-wm_para_t py-2">After a business meets the minimum requirements for funding, Ethis will request from it additional information, as well as a management discussion (through a call or meeting). These information are filtered and utilised to determine the credit worthiness of the Issuer based on our proprietary credit scoring system.</p>
<p class="font-normal text-base text-wm_para_t py-2">Simultaneously, Ethis will undertake due diligence to ensure the company is rightfully registered, has no history of bankruptcy, and is currently not involved in any legal cases.</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis’ credit scoring looks at three broad categories – business risk, financial risk, and corporate governance risk.</p>
<p class="font-normal text-base text-wm_para_t py-2">Each subject category is given a score of 1 to 5 (1 being the least risky and 5 being the most risky) and will be given an appropriate percentage (%) weighting. The final weighted score will determine which risk category the business belongs to and whether or not Ethis can fund the business.</p>
<p class="font-normal text-base text-wm_para_t py-2">Any weighted risk scores of 3.75 and below are eligible for funding consideration by Ethis. However, scores of 3.00 to 3.75 may incur additional conditions by Ethis and possibly higher fees.</p>
<p class="font-normal text-base text-wm_para_t py-2">SECOND LEVEL OF SCREENING – Social Media Scoring</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis may collaborate with outsourced entities to offer another level of screening/due diligence of potential Issuers.</p>
<p class="font-normal text-base text-wm_para_t py-2">Activities in the business owners’ LinkedIn, Facebook, and Twitter accounts may be analysed to determine his/her willingness to pay. Among other things, Ethis may look at a person’s connections with family, level of education, professional contacts and places of travel. While Ethis does not put too much emphasis on this scoring, Ethis deems it to be a useful tool for additional risk screening. Any risk highlighted by this social media screening may be investigated in more detail, if necessary.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Fees and Charges</p>
<p class="font-normal text-base text-wm_para_t py-2">For Investors</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis does not charge any fees to Investors except for any fees/charges by third parties such as Bank Charges or Trustee Charges.</p>
<p class="font-normal text-base text-wm_para_t py-2">For Issuers</p>
<p class="font-normal text-base text-wm_para_t py-2">a) Registration Fee (up to RM4,500)</p>
<p class="font-normal text-base text-wm_para_t py-2">A one-time fee charged upon an Issuer’s application to host a Campaign on the ECF Platform. This fee is non-refundable regardless of the success of the Campaign.</p>
<p class="font-normal text-base text-wm_para_t py-2">b) LLP Incorporation Fee (RM1,000)</p>
<p class="font-normal text-base text-wm_para_t py-2">This fee is charged to Issuer to cover the cost of incorporating a LLP, if applicable.</p>
<p class="font-normal text-base text-wm_para_t py-2">c) Campaign Fee (8% – 10% of capital amount raised)</p>
<p class="font-normal text-base text-wm_para_t py-2">The fee charged by the ECF Platform to Issuer upon a successful fundraising. Rate is determined by the extent of services provided and the total amount of funds raised. The fee amount calculated from the rate will be deducted from the investment money disbursed to Issuer.</p>
<p class="font-normal text-base text-wm_para_t py-2">d) Post-Campaign Fee (up to RM3,600 per annum)</p>
<p class="font-normal text-base text-wm_para_t py-2">The fee charged by the ECF Platform to Issuer for services related to post-ECF Campaign period and covers investment updates by the Issuer to Investors.</p>
<p class="font-normal text-base text-wm_para_t py-2">e) Stamp Duty</p>
<p class="font-normal text-base text-wm_para_t py-2">Duty payable under the law. Any tax or stamp duty applicable by law on the financing amount raised will be borne by the Issuer.</p>
<p class="font-normal text-base text-wm_para_t py-2">Bank Charges – Charges that if applicable shall be based on any charges by the banks (such as IBG or FPX) or payment transfer services.</p>
<p class="font-normal text-base text-wm_para_t py-2">Trustee Charges – Charges that if applicable shall be based on any charges by the Trustee.</p>
<p class="font-normal text-base text-wm_para_t py-2">You are deemed to have agreed to the terms related to the fees and charges involved and have authorised the ECF Platform to make such deductions and charges.</p>
<p class="font-normal text-base text-wm_para_t py-2">Fees may vary from one Campaign to another. You are advised to rely on the terms of the Issuer Agreement or Investor Agreement to determine the exact fees applicable.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Investors’ Money Held</p>
<p class="font-normal text-base text-wm_para_t py-2">All investment amounts are held in Ethis’ Trust Account with Amanahraya Trustees Berhad (Company No. 766894-T) until the company has successfully reached its fundraising target. Any interest earned, if any, on these funds shall be handled by Ethis and shall not be paid to Investors</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis will monitor all transactions made to the Trust Account and will regularly update our records to avoid any discrepancies regarding the account.</p>
<p class="font-normal text-base text-wm_para_t py-2">Should the Campaign fail for any reason, including the targeted amount of at least 80% is not achieved during the given Campaign period, then Ethis will refund the money paid by the Investors. As noted above, no interest shall be payable to Investors on any such refund.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Conflict of Interest</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis and its officers/employees are prohibited from providing any financial assistance to Investors to invest in the Campaign. Ethis will not provide any funding to Issuers or invest in any campaign launched on the ECF Platform.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA)</p>
<p class="font-normal text-base text-wm_para_t py-2">Ethis adopts a compliance procedure that is in accordance with this regulated Act. Ethis does not encourage and tolerate any prohibited financial crime committed on the ECF Platform. Ethis will lodge a report to the relevant authorities if there are any suspicious transactions.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Information and Materials on the ECF Platform</p>
<p class="font-normal text-base text-wm_para_t py-2">Once Ethis is satisfied that an Issuer is ready to launch the Campaign on the ECF Platform, Ethis shall ensure that the Issuer submits an information pack or memorandum which may include, but not limited to, the ownership and management structure, assets and liabilities, business plan and other relevant information. This information pack will be published on the ECF Platform for the Investors to access and do their own research before committing to an investment.</p>
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<p class="font-semibold md:text-22px text-base text-headline_cl pt-4 pb-4">Complaints and Dispute Resolution</p>
<p class="font-normal text-base text-wm_para_t py-2">If you have a complaint about the services operated by the ECF Platform, you may communicate such complaints through the ECF Platform’s proper communication channels. If you are not satisfied with the response or outcome, you may escalate your complaint to Ethis’ Compliance Officer (CO) via the email address complaint.co@ethis.co. The CO shall oversee the management of complaints to ensure a response no later than seven (7) business days from the date of the complaint.</p>
<p class="font-normal text-base text-wm_para_t py-2">Alternatively, you may direct your complaints to the Consumer and Investor Office of the SC. Details of the Office is as follows:-</p>
<p class="font-normal text-base text-wm_para_t py-2">Calling: (+603) 6204 8999; <br>Faxing: (+603) 6204 8991;<br>Emailing: aduan@seccom.com.my; <br>Mailing To: <br>Consumer &amp; Investor Office<br>Securities Commission Malaysia<br>No 3 Persiaran Bukit Kiara,<br>Bukit Kiara,<br>50490 Kuala Lumpur</p>
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