1) Registering a new local company
Foreigners are only allowed to register Sendirian Berhad (Private Limited) companies in Malaysia. Industries such as education, oil & gas, banking, tourism, and agriculture require at least 50 percent Malaysian ownership, while most others permit 100 percent foreign ownership. For advisory and consultancy businesses, a minimum paid-up capital of RM500,000 is required. For import, export, restaurant, or trading businesses, minimum paid-up capital of RM1,000,000 is required. The business should also show promise of benefiting the Malaysian economy, by, for example, creating more job opportunities for the local workforce.
Register Company in Malaysia
A foreign company may carry on business in Malaysia by incorporating a local company. The basic requirements to set up a Locally Incorporated Company under the Companies Act are the same for both Malaysians and Foreigners:
- A minimum of one Company Shareholder
- A minimum of one Resident Director (Nominee Director services are available locally)
- A Resident Company Secretary who is either is a member of a prescribed professional body or is licensed by the SSM
- A minimum Paid-up Capital of RM1
Visit Incorporation of a Company Limited by Shares for more detailed information.
2) Registering a foreign branch of parent company
Foreign companies interested in doing business in Malaysia can also register a subsidiary company, branch office or representative office in Malaysia. A proposed company name has to be first approved before the application can proceed. For branch office, the proposed company name must be the same as the company name of the country in which it was originally registered.
Upon name approval, applicants are to submit the following documents to the SSM within 30 days to register company in Malaysia:
- the name, identification, nationality and the ordinary place of residence of every shareholder in Malaysia and, if any of these person is a body corporate; the corporate name, place of incorporation or place of origin, registration number and the registered office of the body corporate;
- the name, identification, nationality and the ordinary place of residence of every person who is appointed as a director of the foreign company in Malaysia;
- the list of its shareholders or members at its place of origin;
- in the case of a foreign company with share capital, the details of class and number of shares at its place of origin;
- in the case of a foreign company limited without share capital, the amount up to which the member undertakes to contribute to the assets of the foreign company at its place of origin in the event of its being wound up;
- the name and address of a person who is a resident in Malaysia, who is appointed by the foreign company as its agent under a memorandum of appointment or power of attorney; and
- other information that the Registrar may require, such as certified copy of the certificate of incorporation or registration of foreign company; certified copy of its constitution, if available.
If any of the described registration documents are in languages other than Bahasa Malaysia or English, a certified translation of such documents in Bahasa Malaysia or English shall be required attached.
When all relevant registration documents have been submitted to the incorporation authority to open company in Malaysia, the company registration certificate will be issued. The designated agent is responsible for all matters that the company must perform according to law. If the agent changes, the incorporation authority must be notified within one month of the replacement.
Employment Visas for Foreigners
A Private Limited (Sdn Bhd) company can apply Employment Visas in Malaysia for its management or professional staff. To qualify, a 100% foreign-own company must have a Paid-up Capital of at least RM500,000 (advisory and consultancy business) or RM1,000,000 (import, export, restaurant and trading business). If the company is a joint venture with local Malaysian partners, the minimum Paid-up Capital required is RM 350,000.
Valid for 2 years and extendable up to 10, the DP10 work permit, also known as Professional Work Permit Visa, is the preferred visa for foreigners who are business owners or who fall under the highly skilled category of employees.
- Section 30(1) CA 2016 requires the display of both registered name and company registration number at its registered office and every place where the company’s business is conducted, and also every place where its books are kept. In addition, s30(2) also requires the company to disclose its registered name and company registration number in its business correspondence and documentation including its website.
- Company Secretary must be appointed within 30 days after incorporation.
Annual Obligations of a Branch Office
- Annual Return
File with the Registrar each calendar year not later than thirty (30) days from the anniversary of its registration date.
- Audited financial statements
Within two (2) months of its AGM, lodge with the Registrar a copy of the financial statements to that company at the place of its incorporation or origin and a duly audited statement showing the foreign company assets used in and liabilities arising out of its operations in Malaysia.
- Accounting records
All accounting and other records which will sufficiently explain the transactions and financial position of the foreign company arising out of its operations in Malaysia should be kept in Malaysia
- Annual Tax Return
It is compulsory for the foreign company to file tax return with the Malaysian Inland Revenue Board.