Setting up a business in Malaysia


If you wish to set up a business in Malaysia, you will find all information regarding procedures and requirements in this article.

Over the last few years, Malaysia has been attracting foreign investors from across the globe. In fact, the country hosts hundreds of foreign and international companies for the numerous opportunities it offers in various fields. Most of these are found in the Klang Valley in Kuala Lumpur and are involved in the following industries: oil, gas, aerospace, automotive manufacturing, luxury products, food, etc. Note that with a 6% growth rate, Malaysia ranks 22nd among the world's major exporters.

Malaysia is also preferred by foreign entrepreneurs for its capital city which is deemed to be a trade facilitator due to the presence of massive transport networks.

Types of companies

There are three legal types of companies in Malaysia: the Limited Liability Company (private Berhad), the Public Liability Company (public Berhad) and the General Partnership.

The LLC and the PLC generally require between 2 and 50 shareholders with a minimum of two ordinary shares of RM 1 each. Partners' liability is limited to the nominal value of shares. Moreover, the limited liability company must have at least two partners and associates.

As regards the Partnership, the number of shareholders required ranges between 2 and maximum of 20. No minimum capital is required. Liability is joint and several.

The representative or regional office

The representative or regional office is considered as a foreign company's extension. Most foreigners opt for this type of structure in Malaysia as it seems to be the easiest. Moreover, the representative or regional office allows the recruitment of Malaysian staff as well as to create a few posts for foreigners. However, expatriates should already be employed by the head office or group of companies.

However, the representative office does not charge for services, products, etc. To set up this type of company, you will have to make a request to the Malaysian Investment Development Authority (MIDA) which is an investment promotion agency.

Approval proceedings should take between 10 and 12 weeks. This approval will have a minimum of two years validity. The MIDA will also approve the regional office's legal status as well as positions created for expatriates. Note that the company should have a physical office in Malaysia within three months as from the approval date. No capital, director or financial audit is required.

Regarding bonds, you will have to make an annual tax declaration based on your staff's annual salary as well as an annual report of your company's activities to the MIDA.


The company's head office should have existed for at least three years and will require a paid capital of 500,000 ringgits and a financed capital of 300,000 ringgits representing the regional office's annual expenditure.

Branch office

A branch office is a subsidiary which is authorized to provide services but not allowed to make private purchases and sales of goods. The branch office has to be registered in the Malaysian Trade Register (SSM). This type of company is required to prepare and submit audited accounts, including the parent company's accounts to the SSM each calendar year, as well as report the staff's annual salaries to the tax department.


First of all, you should verify if the company's proposed name is available. Therefore, you have to make a request at the SSM by producing a duly filled and signed 13A form. This procedure costs some 30 ringgits and can be performed online. Once you are done with this step, you will have to hire a company secretary who will be responsible of preparing all documents regarding the setting up of a company. The latter should also provide a statutory compliance declaration for the company. Fees of some 1,000 ringgits apply.

Thereafter, you will have to produce another file containing the following documents to the SSM:

  • the memorandum, the company's incorporation deed and the solemn conformity declaration (which has been prepared by a lawyer or a company secretary)
  • personal information of two shareholders with a minimum capital of 1 ringgit each (note that at least two directors should reside in Malaysia)
  • the original 13A form and a copy of the letter issued by the SSM certifying that the company name is available
  • the company head office's address or location plan.

Finally, you will receive a certificate stating the company's foundation, its tax number, as well as procedures for the company registration in the Employment Provident Fund (EPF), Social Security and the Inland Revenue Board or the Malaysian Treasury. Note that these procedures should be carried out within three months following the company name's reservation.

Registration fees

Registration fees are based on the amount of authorized nominal share capital and have to be paid to the SSM:

  • 400,000 ringgits maximum: 1,000 ringgits
  • from 400,001 to 500,000 ringgits: 3,000 ringgits
  • between 500,001 and 1 million ringgits: 5,000 ringgits
  • more than 1 million and a maximum of 5 million: 8,000 ringgits
  • more than 5 million and a maximum of 10 million: 10,000 ringgits
  • over 10 million and up to 25 million: 20,000 ringgits
  • over 25 million and a maximum of 50 million: 40,000 ringgits
  • over 50 million and a maximum of 100 million: 50,000 ringgits
  • more than 100 million: 70,000 ringgits.

Registration with the SSM involves fees of about 1,000 ringgits. You will also have to pay 220 ringgits for tax stamps and 100 ringgits following the company's incorporation.

 Useful links:

SSM - Malaysia Trade register
MIDA - Investment Promotion Agency
MICCI – Malaysia International Chamber of Commerce and Industry
MACS - Association Malaysian company secretaries

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