We specialize in expediting and simplifying the process of setting up our clients’ Malaysian businesses. Here’s what we think about when advising our clients on registering a business in Malaysia, as well as some tips and tricks that make things easier.
Do you need a license?
When incorporating in Malaysia, the following business activities require a license:
- Manufacturing: Any manufacturer with at least 75 full-time employees;
- Banking and Financial Services: Under the Banking and Financial Institutions Act, 1989, the Malaysian Central Bank licenses and regulates businesses such as banking, money broking, deposit taking, discount houses, provision of credit and finance, merchant banking, deposit taking and certain other financial businesses. This includes all foreign banks, which must incorporate in Malaysia in order to receive a license to serve local customers;
- Building and Construction: A license from the Construction Industry Development Board (CIDB) is required prior before undertaking any construction operations or related activities in the country;
- Oil and Gas: Companies wanting to explore and develop upstream oil and gas reserves in Malaysia must sign a production sharing agreement with Petronas, Malaysia’s state oil company;
- Wholesale and Retail: All proposals for foreign involvement in wholesale and retail trade requires the approval of the Committee on Wholesale and Retail Trade (CWRT).
What do you have to take note before hiring?
We make sure that our clients are prepared for all of the Malaysian employment rules affecting their operational plans.
- Foreign IT staff must be at least 21 years old and management staff at least 27 years’ old;
- 5 employment visas are granted for foreign staff if a company has paid up capital of US$2 million;
- Malaysian companies in the manufacturing, service, plantation or construction sectors may hire citizens of Indonesia, Thailand, Cambodia, Nepal, Myanmar, Laos, Vietnam and the Philippines without restriction;
- Companies active in the manufacturing, service and construction sectors can hire citizens of Turkmenistan, Uzbekistan and Kazakhstan;
- To hire foreign staff in non-export orientated industries, Malaysian companies require i) total sales of RM2,000,000 (US$511,000) and above ii) minimum paid-up capital of RM100,000 (US$25,500).
What are some of the visas available in Malaysia?
- Employment pass
- Investors, professionals and senior managers are allowed to apply for employment pass and they must be employed for a minimum period of 2 years;
- If a company’s foreign paid-up capital is more than MYR500,000, their expatriates are allowed to apply for employment pass;
- It is encouraged that expatriates earn at least a monthly wage of MYR5,000 to prevent their employment application from being rejected;
- Otherwise, expatriates earning more than MYR8,000 a month can be given automatic approval for their employment pass.
- Entrepreneur visa
- Entrepreneurs are entitled to reside in Malaysia and operate their business and visa procedures have been simplified in recent years during the 6th D-8 Summit.
- Visitor visa
- Individuals will have to pay USD16 for a standard visitor visa to Malaysia and it is valid for 1 to 3 months.
What is the MM2H?
- MM2H stands for Malaysia My Second Home and it is an immigration policy in Malaysia that allows wealthy individuals to live in the country and operate their business;
- Individuals who are under 50 years old are eligible if they establish a fixed deposit account of MYR300,000 with a Malaysian bank;
- Individuals who are above 50 years old are eligible if they establish a fixed deposit account of MYR150,00 with a Malaysian bank;
- Recipients under the MM2H program will be entitled to invest in Malaysia and buy housing properties that cost more than MYR500,000;
- Immediate family of the recipients are also allowed to enter Malaysia and they can apply for MM2H too.
What are some of the more important regulations found in Malaysia?
- Companies requires accounting records to be kept so that they are able to keep track of the transactions of the company through balance sheets and profit and loss accounts;
- Companies are required to file annual return and annual tax return with the Company Registrar and Revenue Authority respectively;
- If there are any changes in the particulars of the company or its key management team, the Malaysian Companies Registry must be informed.