Expat's Guide to Company Registration in Malaysia

Malaysia, with its strategic location in Southeast Asia, robust economy, and business-friendly policies, is an attractive destination for expatriates seeking to establish a business. If you're considering setting up a business in Malaysia, this guide provides detailed information on options, legal requirements, and steps to get started.

Start a Business in Malaysia: Structure Options

‍Expats have several options when choosing the structure of their business in Malaysia:

1. Private Limited Company‍

A private limited company, also known as an Sdn Bhd in Malaysia, is the preferred option for foreign investors. It is a separate legal entity, allowing for up to 100% foreign ownership, except in the banking, agriculture, and oil & gas industries, which require a Malaysian citizen to own at least 30% of the capital.

Beyond ownership flexibility, incorporating a Sdn Bhd offers several strategic advantages:

1. Strong economic rebound opportunity – With Malaysia’s economy projected to grow between 4.0% and 4.8% in 2025, establishing a Sdn Bhd position enables entrepreneurs to capitalise on a resilient domestic market.
2. Attractive tax incentives – Newly registered Sdn Bhd companies enjoy tax rebates and deductions, a rebate for new incorporations and special deductions for renovation or refurbishment expenses.
3. Access to grants and financing – Many government-backed grants and loans are available only to incorporated Sdn Bhd companies, opening doors to greater financial support and growth capital.
4. Limited liability and professional credibility – As a separate legal entity, a Sdn Bhd protects personal assets from business risks while also enhancing credibility with clients, investors, and partners.

2. Labuan Offshore Company

‍A Labuan company is an offshore entity that can be set up as a company limited by shares, by guarantee, or as an unlimited company. It may conduct any business permitted in or through Labuan. Both Malaysian residents and expatriates are allowed to establish a Labuan company, which requires a minimum of one director and a resident secretary, as well as a registered office in Labuan. Labuan companies enjoy flexible capital structures with no minimum share capital, shares with no par value, and multiple classes of shares. They can also own controlling stakes in Malaysian domestic companies. While transactions are generally conducted in foreign currencies, certain regulated activities such as banking, fund management, insurance, and leasing require licensing under the Labuan Financial Services Authority (Labuan FSA).

Setting up a Labuan company can serve as a pathway for expatriates to obtain a Labuan Director’s Visa

3. Branch Office‍

This is a legal entity that is an extension of a parent company with foreign ownership. In such cases, the parent company will be held responsible for all the debts incurred by the subsidiary.  All activities carried out by the subsidiary should be identical to those of the foreign parent company. This option is best suited for companies seeking to expand their business into Malaysia. However, it still does require at least one Malaysian resident to be involved in the setup.

4. Representative Office ‍

A representative office is almost similar to a branch office set up, where they do not have an independent legal standing in Malaysia, and they are responsible for all the debts and liabilities incurred by the representative office. The activities of this company are limited to liaison, promotional activities, and market research on behalf of the parent company.

5. Subsidiary Company‍

Foreigners are permitted to establish a subsidiary company in Malaysia. This type of business entity is viewed as a separate legal entity from its parent company, which also means that the business is permitted to run all activities and will also be responsible for all debts and liabilities incurred. This is also a good option for businesses looking to expand into Malaysia. The company name may differ from that of the parent company in the foreign country.

Malaysian Business Registration Requirements

To start up a company in Malaysia, several documents will be required:

1. The certificate of incorporation.
2. The company's articles of association and memorandum.
3. A listing of all local and foreign directors and their specific powers within the company.
4. The memorandum of understanding of the foreign company.
5. Proof of reservation and application of the company name.
6. Proof of email indicating approval of the reservation of the company name.
7. A statutory declaration of the agent of the company.
8. Registration Fees.

Malaysian Company Registration Process‍

The first step in setting up a company in Malaysia is to identify and submit the company name to the Companies Commission of Malaysia or Suruhanjaya Syarikat Malaysia (SSM), along with a fee of MYR 50. Once approved, it will be reserved for a period of 30 days from the date of approval.

During these 30 days, you will be required to submit the following to SSM:

1. Completed incorporation application, which includes

• Proposed company name
• Structure of business
• Nature/type of business to be carried out
• Registered office address in Malaysia
  
• Business Address (if different)
  
• Full particulars of director(s) and promoter(s)
  
• Declaration from each director/promoter: not an undischarged bankrupt, has not been convicted of an offence inside/outside Malaysia.

2. Declaration of Compliance:
A statement by the individual responsible for incorporation certifying compliance with the Companies Act 2016
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3. Additional documents (where applicable):

• Consent letter from any corporate body member of the company
• Certificate of directors' qualification (if required)
• Consent letter from relevant agency (if business activity needs approval)

4. Payment of incorporation fee: for a company limited by shares (Sdn. Bhd) or a company limited by guarantee.

Support Services and Incentives

The Malaysian government offers various incentives and support services for foreign investors:

‍Malaysian Investment Development Authority (MIDA): Provides information, advisory services, and assistance in obtaining permits and licenses.

‍MSC Malaysia Status: Offers incentives for tech companies, including tax exemptions and grant access.

‍Incentives for Manufacturers: Tax incentives and grants are available to companies in the manufacturing and related services sectors.


Setting up a business in Malaysia offers expats numerous opportunities, thanks to its strategic location, favourable business environment, and government incentives. By understanding the various business structures, incorporation processes, and regulatory requirements, expats can successfully navigate the process of establishing their ventures in this dynamic country. Whether opting for a Private Limited Company, a Labuan Company, exploring the market through a Representative Office, or setting up a Branch, Malaysia provides a conducive environment for business growth and success.

If you need to be put in touch with a specialist to assist you, please email info@expatsclubkl.com

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