Setting Up Foreign Owned
both Malaysian and Foreigner setup:-
Company in Malaysia
As one of the most vibrant countries in
Southeast Asia, Malaysia offers many
advantages as an investment destination.
This has been affirmed by robust growth
in private investment in the country,
which has expanded at a compounded
annual growth rate of 13.9% from the
start of the ETP in 2010 to RM146.1
billion (US$39.89 billion) in 2014.
From manufacturing to distribution or
technical expertise in the services sector,
the country offers opportunities and
capabilities across the value chain.
Whether investors want to utilise
Malaysia as their target market or as a
regional gateway, organisations and their
employees alike will find a myriad of
opportunities upon their arrival here.
Basic Requirements to Set Up a Company
in Malaysia under Companies Act
Private Limited Company (identified
through the words Sendirian Berhad or
Sdn. Bhd.) is the most common business
vehicle in Malaysia. (Find out more on
Foreign Company Setup Options in
Malaysia)
The basic requirements to set-up a
Locally Incorporated Company under
Companies Act, 1965 are the same for
(i) A minimum of one subscribers to the
shares of the company (Section 14 CA);
Equity Policy
(ii) A minimum of one resident director
(Section 122); and The Companies Act, 1965 does not
stipulate any equity conditions on
(iii) A company secretary who can be
Malaysian incorporated companies.
either :
However, to increase local participation in
An individual who is a member of a business, the government encourages
professional body prescribes by the joint-ventures between Malaysian and
Minister of Domestic Trade Cooperative foreign investors. Specific equity
and Consumerism; or conditions may be imposed for specific
approvals, operating licences, permits or
An individual licensed by the Companies
registrations by the regulating
Commission of Malaysia (SSM)
Ministries/Agencies, depending on the
(iv) A minimum paid up capital of RM1
activities undertaken.
Both the director and company secretary
With the liberalisation in equity policy,
shall have their principal or only place or
foreign investors generally could hold
100% equity in majority industries except
for strategic sectors of national interest
NOMINAL SHARE CAPITAL (RM FEES
EQUIVALENT) (RM) such as water, telecommunications,
ports, energy and etc. Nevertheless,
Up to 400,000 1,000
foreigners are advisable to confirm
400,001 500,000 3,000
500,001 -1 million 5,000
whether the proposed business activities
1,000,001 5 million 8,000
are permitted and the requirements for
5,000,001 10 million 10,000
foreign set-up in Malaysia.
10,000,001 25 million 20,000
25,000,001 50 million 40,000
50,000,001 100 million 50,000 Business Licenses
100,000,001 and above 70,000 For every industry, there are specific
sector regulations issued by the relevant
residence within Malaysia. governmental departments. These
include regulations that could impose
Company Registration fees
restrictions on the foreign ownership of
equity of a company, require higher paid
up capital requirements and also prior
regulatory approval before the
commencement of business operations
Business licences can be categorized into
3 different logical groups, namely:
General licences
Sector Industry Specific licences
Activity Specific licences
Wholesale, Retail Trade (WRT)
License
The most common license required for a
foreign owned company is WRT license.
This WRT license is applicable to any
Foreign Participation (i.e. foreign equity at
51% and above) in the Malaysia
Distributive Trade Services include
wholesalers, retailers, franchise
practitioners, direct sellers, suppliers,
who channel their goods in the domestic
market, and commission agents or other
representatives including those of
international trading companies.
The WRT license is required by all the
said business sectors before they can
apply for a professional work permit. For
WRT, the minimum paid up capital
requirement is RM 1 million, with
company full set-up i.e. with business
premises supported with valid tenancy
agreement, phone line and etc.
Visa / Pass to Stay in Malaysia
Having a company in Malaysia doesnt
mean that the foreign investors/directors
can already stay in Malaysia for long
term. The foreign investors/directors
would still be required to go through a
work permit process in order to stay here
for long term.
Malaysia My Second Home program
The Malaysia My Second Home program
(commonly abbreviated "MM2H") is an
international residency scheme enacted
by the Government of Malaysia to allow
foreigners to live in the country on a long-
stay visa of up to 10 years. To qualify for
the program, applicants must meet
certain financial and medical criteria.
Successful applicants are then entitled to
enter and leave the country on a largely
unrestricted basis, and also benefit from
other incentives aimed at making their
stay in Malaysia more convenient. Certain
restrictions may apply.
Why Setup Company in
Malaysia
You should choose Malaysia and set up
business in Malaysia today because:
Malaysian businesses benefit from
massive consumer demand in local
and foreign Asian markets like
India, China, Myanmar, Singapore
and Vietnam;
A resident Malaysian business
faces low startup costs compared
to Singapore; Malaysias monthly
office rental per m2 (US $17) and
wage rate (US $2,310) are less than
Singapores (US $68 and US $3,245);
A resident firm benefits from
countrys 68 double taxation
treaties which minimize
withholding tax on fund transfers
abroad;
There is no withholding tax levied
on dividends made abroad by
Malaysia businesses;
Malaysia businesses face no
restrictions on repatriation of
capital, profits, dividends and
royalties;
A resident business profits from the
free trade agreements signed
between Malaysia and 6 other
ASEAN countries;
Malaysian businesses enjoys duty
free trade through free ports in
Pasir Gudang, Port Klang, Kulim Hi-
Tech Park, Port of Tanjung Pelepas
and Bayan Lepas;
A Malaysia business can sponsor a
visa for its director if the share
capital exceeds RM 500,000;
World Bank has ranked Malaysia as
the 6th easiest place in the world
to do business in their 2014 report;
 The country is positively ranked as Growth potential in the industrial Youthful & skilful workforce yet are
the 25th most competitive and services sector, especially relatively more cost-effective; and
economy in the world. shared services activities; many more.