Calling all foreigners (non-Malaysian) who wish to start a company/business in Malaysia, now you can register a company in Malaysia. In this article, you will discover some important information regarding the registration of a foreign company in Malaysia and the step-by-step procedure to register a legal Sdn Bhd company in Malaysia.
Here are some of the most popular questions asked:
Can foreigners register and own a company in Malaysia?
Yes, foreigners can fully own a Malaysian Sdn Bhd. Since 2016, it is no longer required to have local ownership in the company. However, under the Malaysian Companies Act of 2016, it is required to have at least 1 director residing in Malaysia.
What type of business entity foreigner can register in Malaysia?
Under the Company Commission of Malaysia (CCM), all foreigners are allowed to register a private limited by shares (Sendirian Berhad – “Sdn Bhd”) company in Malaysia. Foreigners are not allowed to register sole proprietor, enterprise, or LLP companies in Malaysia, these entities are meant for Malaysian only.
What are the benefits of incorporating a Malaysia Company?
- Strategically located in South East Asia
- Low start-up costs and rental rates compared to Singapore
- Lower wages as the average wages are RM1,100 per month
- No double taxation as Malaysia has 68 double taxation treaties with other countries
- No withholding taxes on dividends paid outside of Malaysia.
- No restrictions on Malaysian corporations upon repatriation of capital, profits, dividends, and royalties
- Malaysia has given strong incentives to encourage business formation and capital investment
What kind of foreign businesses are encouraged by the Malaysian government?
Here are a few of the industries in which the Malaysian government is trying to encourage foreign investment:
- Education
- Petroleum, Oil and Gas
- Banking and Finance
- Tourism Outbound and Ticketing
- Agriculture
What are the stages and how to ensure a successful application?
Setting up the right business entity is very important. All profiling and documentation on each stage need to be well connected and presentable to the following authorities for the 5 initial stages:
- Registry Commission for your Company Entity (Malaysian Sdn Bhd)
- Multiple Trade Licenses from Local Town Council, Ministry Trade Consumerism, Tourism, Central Bank, Education, Transport authorities, etc.
- Letter of Recommendation for relevant authorities to boost your application.
- Expatriate Work Visa from the Immigration Department of Malaysia.
- Compliance and maintenance keeping company status active (Company Commission, Company Secretary, Auditor, Accountant and Tax Agencies)
Each authority has its own set of requirements on profiling, setting, and documentation. To minimize risk and cost, it is advisable to set the right profile that enables the acceptance of all authorities for all applications. Getting it right from the first step is crucial to enjoy hassle-free, minimize cost, and avoid stressing moments in the whole process.
How long does it take to incorporate a Malaysian Sdn Bhd Company?
2 to 3 days.
