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Advisory Agreement
I need an advisory agreement for a consultant who will provide strategic business advice on a project basis, with a focus on market expansion strategies. The agreement should include a clear scope of work, payment terms based on deliverables, confidentiality clauses, and a termination clause with a 30-day notice period.
What is an Advisory Agreement?
An Advisory Agreement sets out the terms when someone hires a professional advisor to provide guidance, typically in areas like business strategy, investments, or corporate matters. In Malaysia, these agreements commonly fall under the Capital Markets and Services Act 2007, especially when involving licensed financial advisors or investment consultants.
The agreement spells out key details like the advisor's duties, fees, confidentiality requirements, and how long the relationship will last. It protects both parties by clearly defining what services will be provided, while ensuring advisors meet Malaysian regulatory standards, particularly when dealing with securities or corporate advisory work regulated by the Securities Commission Malaysia.
When should you use an Advisory Agreement?
Consider putting an Advisory Agreement in place when seeking professional guidance for business decisions, investment strategies, or corporate restructuring. This becomes especially important when engaging financial advisors regulated under Malaysia's Capital Markets and Services Act, or when planning significant business moves that require expert consultation.
The agreement proves essential during fundraising rounds, mergers and acquisitions, or when navigating complex regulatory requirements. Malaysian businesses often need these agreements when working with licensed corporate advisors, investment banks, or consulting firms. It helps establish clear expectations, protects confidential information, and creates a framework for the advisory relationship.
What are the different types of Advisory Agreement?
- Investment Consulting Agreement: Used for professional investment advice and portfolio management services, typically regulated by Securities Commission Malaysia
- Business Advisor Agreement: Covers general business strategy and operational consulting services
- Sub Advisor Agreement: Enables primary advisors to delegate specific tasks to specialized sub-advisors
- Agreement Between Consultant And Company: Broader consulting arrangement covering multiple business aspects
- Advisory Services Contract: Comprehensive agreement for ongoing advisory relationships across various industries
Who should typically use an Advisory Agreement?
- Licensed Financial Advisors: Registered professionals under Securities Commission Malaysia who provide investment advice and create Advisory Agreements
- Corporate Clients: Companies seeking strategic guidance, including listed companies, SMEs, and startups
- Business Consultants: Independent experts offering specialized business advice across industries
- Investment Banks: Financial institutions providing corporate advisory services for mergers, acquisitions, and fundraising
- Legal Counsel: Lawyers who draft and review agreements to ensure compliance with Malaysian regulations
- Company Directors: Decision-makers who sign and oversee advisory relationships on behalf of their organizations
How do you write an Advisory Agreement?
- Advisor Details: Gather licensing information, qualifications, and registration details with relevant Malaysian authorities
- Scope Definition: Clearly outline advisory services, deliverables, and any specific industry requirements
- Fee Structure: Document payment terms, including base fees, success fees, and reimbursable expenses
- Timeline Planning: Set clear start dates, milestones, and agreement duration
- Compliance Check: Review Securities Commission Malaysia guidelines and Capital Markets Services License requirements
- Document Generation: Use our platform to create a customized, legally-sound agreement that meets Malaysian regulatory standards
- Final Review: Verify all terms align with both parties' expectations before signing
What should be included in an Advisory Agreement?
- Parties' Information: Full legal names, business registration numbers, and Malaysian addresses of advisor and client
- Services Scope: Detailed description of advisory services, deliverables, and performance metrics
- Fee Structure: Clear payment terms, including amounts, schedules, and any success-based compensation
- Confidentiality: Provisions protecting sensitive information under Malaysian data protection laws
- Duration & Termination: Agreement period, renewal terms, and conditions for ending the relationship
- Regulatory Compliance: References to relevant Malaysian financial services regulations and licensing requirements
- Dispute Resolution: Malaysian jurisdiction clause and preferred method of conflict resolution
- Liability & Indemnity: Risk allocation and protection mechanisms for both parties
What's the difference between an Advisory Agreement and an Agency Agreement?
An Advisory Agreement differs significantly from an Agency Agreement in several key aspects, though both involve professional services. Understanding these differences is crucial for Malaysian businesses to choose the right agreement for their needs.
- Scope of Authority: Advisory Agreements focus on providing recommendations and expertise, while Agency Agreements grant authority to act on behalf of the principal and bind them legally
- Legal Relationship: Advisors maintain independence and offer guidance, whereas agents have fiduciary duties and must act in their principal's best interests
- Regulatory Framework: Advisory Agreements often fall under Securities Commission Malaysia's oversight, particularly for financial advice. Agency Agreements are governed by Malaysian contract law and specific industry regulations
- Liability Structure: Advisors typically have limited liability for recommendations, while agents can be held directly responsible for actions taken on behalf of principals
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