Document background
The Silent Partner Agreement is a crucial legal document used in Malaysia when businesses seek to bring in investors who will provide capital without involvement in business operations. This agreement type is particularly relevant for entrepreneurs and business owners who need funding but want to maintain operational control, while investors seek passive investment opportunities. The document, compliant with Malaysian Partnership Act 1961 and other relevant legislation, typically includes detailed provisions for capital contribution, profit sharing, liability limitations, and financial reporting requirements. It's commonly used in various business sectors, from retail to technology, and provides essential protection for both active partners who manage the business and silent partners who contribute capital. The agreement must carefully balance the silent partner's right to information and returns with their non-participation in management to maintain their limited liability status.
