Incorporate Business in Malaysia

Why Incorporate your Business in Malaysia

Malaysia has been a strategic location for trading for many years. In the 16th century, the Malacca port became a major stopping place for traders from all over the world to replenish supplies. At one point, it was even considered the most important trading port in Southeast Asia.

Today, as the world is experiencing globalisation every second, Malaysia is still considered a prime location to start and operate a business. The Global Startup Ecosystem Report 2020 (GSER2020) published by Startup Genome has found that the capital of the country, Kuala Lumpur, has provided several good reasons for starting a business there. Among these are a US$23 million Technology Start-up Funding Relief Facility set up by the Malaysian Government to aid start-ups affected by the Covid-19 pandemic. The same report found that Kuala Lumpur ranks in the Top 20 for talent and Top 10 for Emerging Ecosystem Performance out of 40 ecosystems. The Kuala Lumpur business ecosystem is also valued at US$15 billion. 

So, you are in the right place if you are a non-Malaysian and are looking for any of the following: 

  • A conducive environment that fosters and supports entrepreneurs
  • A wealth of young talent with enthusiasm to match the scale of your own excitement 
  • A convenient, well-connected location to establish a homeground for your company.

Living in Malaysia

With a population of some 32 million people, Malaysia comprises 13 states and three federal territories across Peninsular and East Malaysia. As the country has shifted from an agrarian to an industrial economy, the majority of the population has come to reside in the main urbanised centres and state capitals. However, a large percentage of national GDP still derives from the main commodity sectors of palm oil and rubber. Other key industries include oil and gas, electronics, pharmaceuticals, medical equipment and fintech/Islamic finance.

The cost of living is relatively low and affordable, good quality healthcare is easily accessible. Malaysians are friendly and welcoming, and English is widely spoken, particularly as a business language. Malaysia is well-served by good infrastructure in transport and telecommunications,, and there are plenty of beautiful places to explore around the country, ranging from tropical rainforests, mountain landscapes and coastal beaches. 

Doing Business in Malaysia

Malaysia is geographically situated at a strategic location – a regional crossroads as it were – and is very accessible to other ASEAN countries. Malaysia is actively focused on becoming a regional digital hub and as such is promoting a number of initiatives to attract applicable businesses. The Malaysia Government offers several programmes that are to the benefit of entrepreneurs and growing businesses.

For example, the Malaysia Digital Economy Corporation (MDEC) under the Ministry of Communications & Multimedia of Malaysia has a Tech Entrepreneur Programme that offers a 1-year visa to new entrepreneurs and 5-year visa to established entrepreneurs. An entrepreneur can also apply for MSC Malaysia Status under MDEC to access a wide range of incentives, rights and benefits to promote continued growth for local and foreign ICT-related businesses. Another organisation that provides an supportive ecosystem for entrepreneurs is MAGIC

Operating a business in Malaysia is relatively cost-effective in terms of the quality of services and skills received, as compared with its neighbouring countries. As an entrepreneur in Malaysia, there are also many funding opportunities with venture capital firms or other private investment firms. The tax regime is also favourable for small businesses. 

Setting Up A Company in Malaysia

Malaysia’s recently updated Companies Act 2016 has simplified many processes and it has attracted a sizeable contingent of non-Malaysians to launch a business locally . You can even incorporate a private limited company (known as Sendirian Berhad or Sdn Bhd in Malaysia) online from the comfort of your home, starting from here

A Sdn Bhd brings several benefits, being considered as a separate legal entity from its owners. It is also a limited liability entity, which means it will not put the owner’s personal assets and finances at risk, and also allows transferability of ownership. 

A few simple requirements need to be met in order to incorporate a Sdn Bhd, including:

  • A minimum paid up capital of RM1. 
  • At least one director of a minimum age of 18 years old and residing in Malaysia.
  • All directors should not be bankrupt nor have been convicted in Malaysia within the last 5 years.
  • An appointment of at least one company secretary, who is a member of a professional member recognised by the Companies Commission of Malaysia (SSM).
  • An office with a registered address.

With Malaysia being positioned as an increasingly attractive location to start your business, it’s definitely worth considering for all the reasons outlined above. In compliance with the Companies Commission of Malaysia, it is mandatory to appoint a company secretary within 30 days of incorporating a Sdn Bhd. Fret not as you can leave that to us, while you comfortably settle into your new life in Malaysia. Contact us today for more information.

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