14/07/2025

BIZ & FINANCE MONDAY | JULY 14, 2025

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Blueshark to expand battery swapping infra

Risks around shadow ownership through nominee arrangements

Revenue Board (IRB) as whatever income that has to be taxed has been

IT IS common in many industries such as the oil and gas industry or industries that require government licensing where there are strict ownership requirements before companies can bid for government contracts to have nominee shareholder director arrangements without the necessary disclosure of the beneficial owners. Usually, the undisclosed beneficial owner will have side agreements with the nominee shareholder on the arrangement which will contain covenants for the beneficial owner with the necessary protection in case there is a fallout in the future, and provisions to acquire the shares back. Maintaining such arrangements without disclosing the beneficial owner is clearly a contravention of the company law which was amended in 2024 to mandatorily disclose the beneficial owners of the shares in the company. This will also in contravention of the various licensing requirements. Taxation of nominee shareholder directors In taxation, income from illegal transactions is still taxable. Taxation is entirely independent of the provi sions of other legislations. Generally, the nominee shareholder directors will be receiving income that will comprise of director fees, meeting attendance allowances, dividends and other benefits and perquisites. Normally such shareholder directors will have to file an income tax return and disclose all these incomes except dividend income which is exempt. However, from 2025, dividends received by individual shareholders exceeding RM100,000 will be subject to a 2% tax and this will be payable upon filing their tax returns. If the undisclosed shareholder directors retain all the income, including the dividend income, and pay the taxes accordingly, there will be no issue with the Inland

taxed accordingly. Where is the risk?

o EV tech mobility company eyes more than 50 stations by middle of 2026 in partnership with Petronas Dagangan

week, investors continued to trade a wide range of Ecoshop warrants, including ECOSHOP-CJ and ECOSHOP-CM. Notably, ECOSHOP CH was sold out on Thursday morning as investors took positions in this warrant. To view the full list of structured warrants on Bursa Malaysia, visit malaysiawarrants.com.my. Provided for Malaysian residents’ information only. This commentary has not been reviewed by the Securities Commission Malaysia. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice. The warrants will not be offered to any US persons. In many cases, there is a possibility that the undis closed nominee sharehold ers receive the dividend income and pass it on to the beneficial owners of the shares. The question arises here is whether such income that is passed on to the beneficial owners is taxable. At the first leg of the money transfer from the company to the nominee shareholder director as dividends will be tax exempt except for dividends in excess of RM100,000. At this stage, the nominee shareholder would have to declare the dividend received and the pay the tax. It is likely here that the nominee arrangement could surface in the event the nominee directors financial affairs are examined by IRB. The problem will arise when the nominee directors may not have the necessary capital to support the funding of the shares. If it surfaces, the nominee arrangement has to be disclosed to IRB and as long as the 2% tax is paid, the nominee shareholder will not be in contravention of the Income Tax Act. In practice, the nominee shareholder directors will usually transfer the dividends to the beneficial owners. The big question here is whether the transfer of the dividends to the beneficial shareholders and directors is a gift or is it income that will be taxable in the hands of the recipient, who is the beneficial owners. Since the dividends will be regularly transferred from the nominees to the beneficial owners, the question of taxation arises. This article is contributed by Thannees Tax Consulting Services Sdn Bhd managing director SM Thanneermalai (www.thannees.com).

Ű BY HAYATUN RAZAK sunbiz@thesundaily.com

week-on-week (w-o-w), on the back of optimism for improved earnings in certain industries, as well as additional policy support by Beijing to spur growth ( South China Morning Pos t, 11 July). Top warrants for the week included calls HSI-CWEY, HSI-CWGB and HSI-CWGS, and puts HSI-PWFZ and HSI-PWHC. All these warrants expire at the end of this month except call HSI-CWGS, which expires end of August. All warrants will undergo time decay, which means a reduction in time value over time such that it becomes zero at expiry. This process speeds up as a warrant approaches expiry. Investors should take note of the expiry date of warrants in their portfolio. Other than that, a new put warrant over Pop Mart International, “Petronas is one of the top five most cash-rich companies in South east Asia and a national brand in Malaysia.” Chong said Petronas’ network of more than 1,000 stations nationwide offers Blueshark wide coverage. “Placing our battery swap stations at Petronas stations makes it much easier and more convenient for customers.” Chong highlighted that many Petronas stations are already instal ling rooftop solar panels, which could eventually power the battery swap infrastructure. “This would allow us to offer a fully clean energy, net-zero emissions solution.” He pointed out that Petronas’ strong business-to-business network would support Blueshark’s growth in the commercial segment. “We are also collaborating with Mesra to create a point system to benefit customers. There’s a lot of synergy in working together,” he added. Future plans include opening Blueshark showrooms at Petronas stations and launching joint pro motions via Petronas and the Setel app. Chong expressed hope that the upcoming national budget would continue to support two-wheeler EV adoption. “The carbon emissions from two motorbikes are equivalent to those of one car. So, if the government supports two-wheelers, the ROI is better and emissions can be reduced more effectively,” he said. The current RM2,400 subsidy for electric cars has minimal impact on middle- and high-income groups, he opined. “For them, the amount is too small to make an impact. But if you

TURNOVER on the local warrants market jumped 18% to RM911.4 million last week, averaging RM182.3 million per day. Hong Kong’s Hang Seng Index (HSI) see-sawed through the week as news on US tariffs rocked markets. It kicked off Monday relatively flat (- 0.1%) as US President Donald Trump confirmed that tariffs will take effect on Aug 1, before surging 1.1% on Tuesday then losing all its gains on Wednesday as investors awaited further clarity on the US trade policy and negotiations surrounding certain trade partners. Nonetheless, the index regained about 1% over Thursday and Friday to end at 24,139.57, 0.9% higher SHAH ALAM: Blueshark Ecosystem Sdn Bhd, in partnership with Petronas Dagangan Bhd, aims to expand its network of battery swap stations from 20 to more than 50 nationwide by the middle of next year, in a push to accelerate electric vehicle (EV) adoption in Malaysia. Each battery swap station costs about RM50,000, with expenses shared between Blueshark and Petroliam Nasional Bhd (Petronas), Blueshark CEO Jeff Chong told SunBiz in an interview. A joint venture agreement was signed on May 9, aimed at accelera ting the adoption of electric two wheelers in Malaysia. Blueshark holds a 51% stake and Petronas Dagangan the remaining 49% in the joint venture. Chong said the planned ex pansion is based on the expected uptake of Blueshark’s e-bikes. “We are very confident that this year we will see at least tenfold growth compared to last year,” he said, adding that this growth sup ports the targeted number of new stations. “We don’t want too many stations that end up underused. We need to ensure a good return on investment (ROI),” he added. The rollout will initially focus on the Klang Valley, Johor and Penang. “We will prioritise these three areas first because our bike popu lation is concentrated in these cities,” Chong said. He noted that the strategic partnership with Petronas enhances brand trust and broadens market reach. WARRANTS WATCH

apply a RM2,400 subsidy to e-bikes, you can help the B40 group and achieve better environmental out comes with a relatively small invest ment.” Chong cited data showing that motorcycles emit about 103 grams of carbon per passenger per kilometre, compared to 192 grams for cars. “If the government wants to address this issue effectively, it should focus on bikes rather than cars. The ROI will be higher, especially considering Malaysia has almost 15 million bikes on the road,” he said. Chong called for more green funding to support industry growth, noting that Malaysia’s adoption of electric two-wheelers remains rela tively low compared to countries like Thailand and Vietnam, where sup portive policies and stronger demand have driven growth. “Right now, there isn’t much funding or support to grow this sector. The government should con sider this,” he said. Chong hopes the coming national budget will continue to support two wheeler EV adoption.

Issues over Eco-Shop Marketing actively traded, ECOSHOP-CH sold out

Top HSI warrants by volume traded Warrant Volume Issuer Exercise

Expiry date

name

(mil) 968.1 886.5 820.3 618.6 520.9

level/price

HSI-CWEY HSI-PWFZ HSI-CWGB HSI-PWHC HSI-CWGS

Kenanga Kenanga Macquarie Macquarie Macquarie

26,000 22,000 26,000 22,000 28,000

30 Jul 2025 30 Jul 2025 30 Jul 2025 30 Jul 2025 28 Aug 2025

In the local market, top warrant underlyings for the week included YTL Corporation (YTL Corp), YTL Power, NexG and Eco-Shop Marketing (Ecoshop). NEXG shares surged 12.5% for the week, causing investors to trade NEXG-C69 and NEXG-C68, among others. Further, although Ecoshop shares closed unchanged for the

POPMART-H1, was listed last week. Pop Mart has seen strong uptrend momentum in its share price, hitting its all-time closing high of HK$275 on June 16. Currently, both call and put warrants over Pop Mart are available, allowing bullish or bearish investors to gain leveraged exposure to Pop Mart without leaving Bursa Malaysia.