How to register a company in Malaysia: Step-by-step guide.

Registering a company in Malaysia is an important first step for businesses aiming to establish a presence in one of Asia’s most dynamic markets. The country offers a favourable environment for both local and foreign investors, supported by consistent economic growth, a stable legal system and ongoing efforts to encourage investment across various sectors. Whether expanding a regional footprint or launching a new venture, understanding the registration process is essential to ensure smooth market entry and ongoing compliance.

This guide provides a comprehensive overview of how to register a company in Malaysia, outlining the legal requirements, application procedures and post-registration responsibilities for businesses planning to operate in the country.

Understanding company types in Malaysia

Before proceeding with registration, it is essential to understand the different types of companies that can be registered in Malaysia. The most common types include:

• A private limited company (Sendirian Berhad or Sdn Bhd) is the most popular form of business entity in Malaysia. It is a separate legal entity from its owners, with limited liability for shareholders. It is suitable for both small and large businesses.
• The public limited company (Berhad or Bhd) can offer shares to the public and are typically larger organisations. They are subject to more stringent regulations and reporting requirements.
• A limited liability partnership (LLP) combines elements of a partnership and a company, offering flexibility and limited liability for partners.
• A sole proprietorship and partnership are simpler structures but do not offer limited liability protection. They are registered with the Companies Commission of Malaysia (SSM) but under different regulations.
• A branch office is an extension of a foreign company operating in Malaysia. It is not a separate legal entity but a part of the parent company. Branch offices can conduct business activities and generate revenue in Malaysia, but they are subject to certain restrictions and higher tax rates compared to locally incorporated companies.
• A representative office is a temporary setup that allows foreign companies to assess the Malaysian market before making a full entry. It can conduct market research, coordinate activities between the parent company and Malaysian businesses, and gather information on investment opportunities. However, it cannot engage in any profit-making activities or commercial transactions.
• A subsidiary is a locally incorporated company that is controlled by a foreign parent company. It is a separate legal entity from its parent company and is treated as a local company for most regulatory purposes. Subsidiaries offer more flexibility in terms of business activities compared to branch offices and are often preferred by foreign companies looking to establish a long-term presence in Malaysia.

This guide primarily focuses on registering a private limited company (Sdn Bhd), as it is the most common choice for both local and foreign entrepreneurs. For foreign company registration, there may be a different set of requirements.

Pre-registration steps

Before beginning the formal registration process, several important steps should be taken:

Name search

A unique name for the company should be chosen and its availability checked through the MyCoID portal on the SSM website. The name should not be identical or too similar to existing companies, offensive, or violate any trademarks.

Characteristics of Malaysian company names according to the guidelines on company names are:

• The name shall use correct spelling and language.
• If the name has words that are not in Malay or English, the meaning of the words must be given.
• The mixture of Bahasa Malaysia and English is allowed if the use is to describe the type of business and must follow proper grammar.
• Names should not be blasphemous or likely to be offensive to members of the public.
• Names should not resemble elements of religion.
• Names which are too general, such as Technology Sdn. Bhd or International Sdn. Bhd should be avoided.
• Only the names of directors who are specified at the application form for incorporation can be used as company names.
• The meaning of created or coined words must be given.
• Symbols that are allowed to be used in the name of the company are limited to five symbols:
  • & (including dan and N)
  • . (dot symbol)
  • – (hyphen symbol)
  • ( ) (bracket symbol)
  • ‘ (apostrophe symbol)
• The name should not be an acronym that can be confused with names associated with:
  • Names of institutions for higher learning
  • Names that stand for federal government agencies or state and government-owned companies

Document preparation

All required documents should be gathered, including:

• Copies of identification documents (MyKad for Malaysians, passport for foreigners)
• Proof of residential address
• Details of proposed directors and shareholders

Company structure determination

The number of directors (minimum of one resident director required), shareholders and the amount of share capital should be decided.

Directors:

• Minimum of one director with no maximum limit
• Must be a natural person
• Aged 18 years and above

Shareholders:

• Minimum of one shareholder with a maximum of 50 for for private limited companies
• Can be an individual or body corporate
• Individual must be aged 18 years and above

Company secretary:

• Minimum of one company secretary who is a member of any professional body or licensed by the SSM.

Registered address:

• A registered office address is required to receive formal communication and documents from the government. P.O boxes are not allowed.

Share capital:

• Minimum of RM 1

Company constitution drafting

Constitution is optional. If required, it may be prepared or adopted according to the standard constitution provided by SSM.

The registration process

After completing the pre-registration steps, the formal registration process can begin:

Step 1: Company name reservation

• Log in to the MyCoID portal on the SSM website
• Submit the proposed company name
• Pay the name reservation fee (typically RM 50)
• Wait for approval (usually within one business day)

Step 2: Registration application submission

Once the company name is approved, there is a 30-day window to submit the registration application. All necessary documents should be prepared and uploaded through the MyCoID portal. These documents typically include:

• Company constitution
• Statement of compliance
• Statutory declaration by directors and promoters
• Identity documents of directors and shareholders
• Details of registered office address

Step 3: Registration fee payment

The registration fee is RM 1,000.

In addition to core business expenses, entrepreneurs often incur fees for permits, licences and financial services.

Step 4: Approval wait

SSM typically processes applications within one to three business days. Once approved, a Certificate of Incorporation will be issued.

Post-registration requirements

After successful company registration, several important post-registration steps should be completed:

Company seal and share certificates obtaining

It is recommended to order a company seal, although it is no longer mandatory under Malaysian law, as it is still commonly used for official documents and adds an extra layer of authenticity.

Share certificates must be issued to shareholders promptly after incorporation, as they serve as legal proof of ownership and should include the shareholder’s name, the number of shares held and the company’s name and registration number.

Corporate bank account opening

A bank should be selected, and the required documents must be submitted, which typically include:

• Certificate of incorporation
• Company constitution
• Board resolution to open the account
• Identification documents of directors and authorised signatories

Additionally, banks may require:

• Business plan or company profile
• Latest audited financial statements (for established companies)
• Initial deposit (amount varies by bank)
• Completed bank forms and agreements

The process typically takes one to two weeks, and some banks may require in-person visits from directors.

Tax registration

Corporate tax registration with the Inland Revenue Board of Malaysia (LHDN) is mandatory for all companies and involves obtaining a tax file number by submitting Form CP600A along with supporting documents such as the Certificate of Incorporation and company constitution.

If applicable, companies must also register for Sales and Service Tax (SST) with the Royal Malaysian Customs Department when their annual taxable turnover exceeds RM 500,000 for taxable services or when they manufacture taxable goods; this registration is completed online via the MySST portal.

Employment Provident Fund and Social Security Organisation Registration

Employees Provident Fund (EPF) registration is mandatory for all employers and employees in Malaysia; it requires setting up an employer account with the EPF and registering all eligible employees, with monthly contributions made by the employer based on each employee’s salary.

Social Security Organisation (SOCSO) registration provides social security protection for employees and must be completed online through the SOCSO portal, with employers required to make monthly contributions based on each employee’s salary.

Both EPF and SOCSO registrations require documents like the company’s incorporation certificate, director’s identification documents and employee details.

Necessary licences and permits obtaining

Depending on the business activities, specific licences or permits from relevant authorities may be needed. Some common ones include:

• A business premises licence is required by most local authorities to operate a business from a physical location in Malaysia.
• Specific industry licences must be obtained depending on the nature of the business; for instance, food establishments need a licence from the Ministry of Health, while financial services companies require authorisation from the Securities Commission or Bank Negara Malaysia.
• Environmental permits are necessary for businesses whose operations may have an environmental impact.
• Companies engaged in international trade must obtain import or export licences to comply with Malaysian customs and trade regulations.

Conclusion

Registering a company in Malaysia is a structured process that is designed to ensure the establishment of legitimate and compliant businesses. By following these steps, entrepreneurs can confidently navigate the registration process, from choosing a company name to fulfilling post-registration requirements. Understanding and adhering to these procedures not only ensures legal compliance but also provides a solid foundation for business operations. A well-registered company is better positioned to access financial services, engage with other businesses, and participate fully in Malaysia’s vibrant economy.

How Acclime can help with registering a company in Malaysia

With extensive local expertise and a deep understanding of the legal and regulatory landscape, Acclime offers comprehensive support throughout the entire registration process. From selecting the most suitable company type and ensuring compliance with local regulations to preparing and submitting all necessary documentation, Acclime’s services are designed to streamline the process, minimise delays and ensure that your business is set up correctly from the start.

Our tailored approach also includes assistance with post-registration requirements, such as obtaining necessary licenses and opening corporate bank accounts, ensuring your company is fully compliant and ready to operate in Malaysia’s dynamic market. By partnering with Acclime, entrepreneurs and investors can focus on growing their business, while leaving the intricacies of registration and compliance to experienced professionals.