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Starting a business in Malaysia as a Foreigner?

October 16, 2013 | Valerie Wong

As a general rule, there are few restrictions on foreigners starting or owning a business in Malaysia. In fact, the process is relatively inexpensive and has few bureaucratic complications. However, anyone who is planning to start a business in the country should carefully examine the requirements, as well as the benefits and disadvantages of doing business in the country. 

Pros of Starting a Business in Malaysia 

-When it comes to the time, cost and complexity of business registration procedures, Malaysia does quite well on a global scale. In fact, the 2012 Doing Business Survey done by the World Bank places Malaysia as the 18th easiest place to do business in the world. 

-There are no restrictions on maximum shareholding by foreigners. Therefore, a private limited company in Malaysia can be owned 100% by foreign shareholders. The only exceptions are stock brokerages and unit trust companies, which currently have a foreign ownership limit of 70%. 

-Opening a corporate bank account is a relatively straightforward procedure. The banking system in Malaysia is very reliable and some of the world's top retail banks, such as HSBC and Citibank are represented in the country. 

-The country's infrastructure, business efficiency, as well as overall economic performance have received good ratings in the last few years. The 2011 World Competitiveness Report has ranked Malaysia as having the 16th most competitive economy in the world.


-Any company that will do business with local government departments must be approved by the Foreign Investment Committee (FIC) beforehand. In this case, at least 30% of the company must be owned by ethnic Malays.

-Companies in Malaysia must pay a 25% corporate profits tax on all income generated. Every year, a tax return will need to be submitted to Malaysian tax authorities and the company's financial statements must be audited by an approved auditors.

-Forming a company in Malaysia requires a minimum of two shareholders, as well as two directors. The directors must have a permanent address in Malaysia, however there is no requirement that they be Malaysian citizens.

If you want to register a company in Malaysia, the process can be done online. In fact, you aren't required to be present in the country while you register the business. However, getting assistance from a reliable firm that can guide you through the process is recommended, as any mistakes made during the application could cause delays in the business registration process. Servcorp has over 30 years of experience registering corporations around the world and can provide the professional advice you need to get your business started in Malaysia.

The general steps are as follows:

You will first need to do a business name search with the SSM, or Companies Commission of Malaysia. This usually involves selecting 3 company names. The SSM will perform a search to see if any of the names are available for registration.

Once the business name is approved, it will be reserved for a period of three months. During this process, you will need to fill out certain documents and submit them to the SSM. Servcorp can help you by forwarding the documents to you and submitting them to the SSM on your behalf. Once your company has been duly registered, you will receive a Certificate of Incorporation from the SSM and can now start doing business in Malaysia.

If you're interested in registering a company in Malaysia or you want to find out more about doing business in the country, you can visit Servcorp's Malaysia business registration page here