A Guide to Registering a Company in Malaysia

In Malaysia, foreign investors can choose from various company structures tailored to their business models and needs. Each structure comes with specific legal requirements, operational scopes, and tax treatments. Below are the primary types of companies available:

Private Limited Company (Sendirian Berhad, Sdn. Bhd.)

The private limited company is the most common and preferred choice among foreign investors in Malaysia. This company type allows 100% foreign ownership without the need for local shareholders, making it ideal for investors who want complete control over their business. Sdn. Bhd. companies operate as separate legal entities, providing robust legal protection by separating personal and company liabilities. Due to its flexibility and operational ease, this structure is the top choice for most foreign investors entering the Malaysian market.

Succursale

A branch office is ideal for companies already established abroad that wish to expand their operations into Malaysia. It connects foreign enterprises directly to the Malaysian market but is not a separate legal entity from the parent company. All income earned by the branch is taxed under the parent company’s jurisdiction. Setting up a branch requires submitting the parent company’s registration documents and is suitable for businesses looking to establish operations quickly.

Bureau de représentation

A representative office serves as a non-commercial establishment for foreign companies in Malaysia, focusing on market research, business promotion, and networking. This type of office is prohibited from engaging in profit-generating activities or signing contracts. It is best suited for businesses aiming to understand the local market before entering it directly. While the setup process is straightforward, its operational limitations make it more suitable for short-term goals.

Sole Proprietorship

Sole proprietorships are suitable for individuals looking to operate small-scale businesses without establishing a corporate entity. Foreigners can register a sole proprietorship in Malaysia under certain conditions, such as being at least 21 years old and meeting specific residency requirements. Although the registration process is relatively simple, sole proprietors bear unlimited personal liability for company debts, making it a riskier choice. This structure is recommended for small-scale or personal ventures.

Partenariat

A partnership allows foreign investors to collaborate with local partners to establish a business. This structure is straightforward and offers flexible profit-sharing arrangements. However, all partners share unlimited liability for the business’s debts and obligations, making it crucial to choose partners carefully. Partnerships work well for small businesses aiming to leverage local resources.

Limited Liability Partnership (LLP)

The LLP structure combines the advantages of a company and a partnership. LLP partners enjoy limited liability, meaning their responsibility for the company’s debts is limited to their capital contributions. LLPs offer greater flexibility and control, making them suitable for businesses involving multiple partners. Compared to traditional partnerships, LLPs have a clearer tax structure and simpler operations, making them ideal for businesses seeking flexible management.

By understanding these structures, foreign investors can select the one that best aligns with their business needs and growth plans. For further inquiries or detailed assistance with registration processes, Fionza’s professional team is ready to provide support.

Basic Requirements for Company Registration in Malaysia

Foreign investors must meet certain legal requirements when registering a company in Malaysia. Below are the key criteria:

Director Requirements

Under the Companies Act 2016, at least one director must be a resident of Malaysia. The individual must be at least 18 years old and have a permanent residential address in Malaysia, making Malaysian citizens or foreign residents with valid residence permits eligible. This requirement ensures compliance with local regulations and provides a point of accountability in legal matters.

Shareholder Requirements

A minimum of one shareholder is required to register a company. Shareholders can be individuals or corporate entities, and there are no residency restrictions, allowing foreigners to hold 100% ownership or share ownership with local partners. This flexibility enables foreign investors to participate in and control Malaysian businesses easily.

Company Secretary

A qualified company secretary must be appointed to ensure compliance with Malaysian laws. The secretary is responsible for filing statutory documents, maintaining records, and facilitating daily administrative operations. As per the Companies Act 2016, the company secretary must meet specific professional qualifications and is not allowed to serve multiple companies simultaneously.

Minimum Paid-Up Capital

The minimum paid-up capital to register a company in Malaysia is 1 MYR. This low threshold allows startups and small businesses to enter the market with minimal initial investment.

Virtual Address

A Malaysian business address is required for registration. Most foreign investors opt for virtual office services, which provide a legal address for receiving official notices, correspondence, and tax documents. While a physical office is not mandatory, having a virtual address ensures proper communication with local authorities and stakeholders.

By adhering to these requirements, foreign investors can smoothly navigate the registration process and embark on their business journey in Malaysia.

Steps to Register a Company Registration in Malaysia

The process of registering a company in Malaysia is straightforward. Below is a step-by-step guide:

Step 1: Name Search and Reservation

Choose a unique company name that complies with Malaysian laws. Fionza can assist with name searches and reservations, ensuring compliance with the Companies Act and avoiding duplication or infringement issues.

Step 2: Submit Company Registration Application

Provide essential details such as the directors, shareholders, and proposed business activities. Fionza will assist in preparing and submitting all necessary documents to ensure accuracy and compliance.

Step 3: Declaration Submission

Submit a statutory declaration affirming the accuracy of all provided information. Fionza will guide you through this step to prevent delays.

Step 4: Wait for Registration Notification

The Malaysian Companies Commission (SSM) reviews the application and issues a registration notice upon approval. Fionza will monitor the process to ensure timely updates.

Step 5: Obtain the Certificate of Incorporation

After successful registration, you will receive a Certificate of Incorporation, officially establishing your company.

By following these steps and leveraging Fionza’s expertise, you can efficiently complete the registration process and start operating in Malaysia.

For a seamless and hassle-free company registration process in Malaysia, look no further than Fionza. Our expert team can guide you every step of the way, ensuring all your legal requirements are met and your business is set up for success. Get in touch with Fionza today to start your business journey in Malaysia!