Youth and Sports Minister Datuk Seri Azalina Othman Said said the grace period was necessary as some organisations were scheduled to undergo a change in their leadership next year or in 2009.
However, she said certain organisations were expected to change their names while others might register theirs under the act.
"Whatever said and done, our position is very clear. Funding will be focused on associations registered under us," she told reporters after introducing the act here today.
Gazetted on July 26, the act stipulates that leaders of youth organisations should not exceed 40 years of age. It is also aimed at encouraging, facilitating and enhancing the delivery system in youth development.
Azalina said more than 4,000 youth organisations currently registered with the Registrar of Societies (ROS) would have to register themselves under the new act.
She said the ministry's Youth Organisation Registration Office would play an important role in registering the associations as well as administering and enforcing the act.
"We are in the process of compromising some of the associations that may want to be under the act, some may not.
"But the agreement is that if you have the word `youth' in your NGO (non-governmental organisation), it must be according to our interpretation," she said.