Foreign Companies

Companies incorporated outside Malaysia but which set up places of business within Malaysia, or carry on businesses in Malaysia, are referred to in the Malaysian Companies Act as “foreign companies”.

A “foreign company” is required to apply for registration with the ROC, subject to approval from the Ministry of Domestic Trade and Consumer Affairs.  When the application for registration is approved, the company must submit the following documents to the ROC: —

·        A certified copy of its incorporation, or documents to similar effect;

·        A certified copy of its charter statute or memorandum and articles, or other instrument constituting or defining its constitution;

·        A list of its directors and secretary containing similar particulars to those in the prescribed form submitted by a Malaysian company;

·        Where the list includes local directors, a memorandum stating the powers of those directors;

·        A memorandum of appointment, or power of attorney, authorising one or more persons resident in Malaysia to accept, on behalf of the company, service of process and notices required to be served on the company; and

·        A statutory declaration in the prescribed form made by the agent(s) of the company

Agent of Foreign Companies

The agent of the company responsible for all acts of the company is required to perform under the Malaysian Companies Act, 1965.  The ROC must be notified of any change in the appointment of the agent.

Registered Offices of Foreign Companies

A “foreign company” is required within one month of its establishment of a place of business, or commencement of business in Malaysia, to lodge with the ROC for registration, notice of situation of its registered office in Malaysia in the prescribed form.

Annual Return and Financial Statement of Foreign Companies

A “foreign company” incorporated in Malaysia is required to file within 30 days of its Annual General Meeting (AGM), a copy of the duly completed “Annual Return.”   Within 60 days of its AGM, it must also file a copy of the Balance Sheet of its Head Office; a duly audited statement of assets used in and liabilities arising out of its operations within Malaysia, and a statement of a duly audited profit and loss accounts from its Malaysian operations.

Registration for Private Companies by Foreigners

Foreigners are allowed to register a private limited company in Malaysia, provided that at least two of the company’s directors are ordinary residents in Malaysia i.e. the principal or the only place of residence being within Malaysia.

Registration of Manufacturing Companies

A foreign company wishing to set up a manufacturing or assembly plant in Malaysia must first apply for a manufacturing licence from the Ministry of International Trade and Industry.

The conditions, laid down for any new investments in the manufacturing sector, are as follows: —

·         Foreign investors are permitted to hold up to 100% equity of a company if the company exports 80% or more of its production;

·         Foreign equity ownership is permitted up to 100% if the company exports 51% to 79% of its production and meets the following criteria : —

·         It invests RM50 million, or more in fixed assets; or

·         It implements projects which have at least 50% value added, provided that the company’s products do not compete with products presently being produced locally or the domestic market;

·         Foreign equity participation of between 30% and 51% is also allowed if the company exports between 20% and 50% of its production;

·         Foreign equity ownership is allowed up to a maximum of 30% if the company’s export is less than 20% of its production; and

·         Foreign equity ownership of up to 51% is permitted only if the company’s products are either of high technology, or of high priority to the domestic market.