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This ultimate guide will give you a clearer understanding of a subsidiary company in Malaysia and the requirements needed.
A subsidiary company is one of the types of business entities in Malaysia that allow foreign ownership, and if you are seeking to expand to Malaysia, you should consider this type of entity.
Let’s see what is needed to set up a subsidiary company in Malaysia.
What is a subsidiary company?
A subsidiary has a separate legal entity from its parent company. Therefore, the subsidiary is liable for its debts and liabilities.
A subsidiary is suitable for both foreign and local companies who want to expand their business in Malaysia. The company name does not need to be the same as the foreign parent company, and it can conduct all business activities.
Can foreigners set up a subsidiary company?
Yes, foreigners can set up a subsidiary company. The company can be 100% owned by a foreigner.
Requirements for setting up a subsidiary company
The subsidiary company name does not need to be the same as the foreign parent company, and must register the company with the Companies Committee of Malaysia.
Subsidiary companies require a minimum of one corporate shareholder or can be a corporate that is either 100% local or 100% foreign-owned.
One resident director is required. The resident director does not have to be a Malaysian citizen, but has to have a principal residential address in Malaysia.
There are no restrictions on hiring local or foreign staff to work for the subsidiary company. Employment visa is required for foreign staff.
- Identification card or passport of all shareholders and directors of the company
- Residential address of all directors and shareholders
- Company particulars from the company’s Registrar
- Board resolution approving the registration
- Certified true copy of:
- The certificate of incorporation of your company
- The memorandum and articles of association or its equivalent
- Memorandum of appointment or power of attorney authorising the person residing in Malaysia to accept notices on behalf of the foreign company
- Statutory declaration by the agent of the foreign company
Steps of setting up a subsidiary company
1. Approval of company name
There are two ways you can apply for a company name:
Information must be completed during the application for the company name and incorporation of a company online and has a fee of RM 1,000. Once the name is approved by the SSM, the application to incorporate the company will directly be sent to the officer to be processed.
Information for the company name must be completed online and has a fee of RM 50.00 for each name applied. Once the name is confirmed, the name will be reserved for 30 days or longer from the date of approval. After applying for the company name, the applicant can apply for incorporation with a fee of RM 1,000.
2. Registering a subsidiary company with the SSM
After the confirmation of the company name, you must register with the SSM within 30 days.
The fees for registration will depend on the authorised capital share of your company.
|Authorised share capital (RM)||Fees (RM)|
|Up to 400,000||1,000|
|400,001 – 500,000||3,000|
|500,001 – 1 million||5,000|
|1,000,001 – 5 million||8,000|
|5,000,001 – 10 million||10,000|
|10,000,001 – 25 million||20,000|
|25,000,001 – 50 million||40,000|
|50,000,001 – 100 million||50,000|
|100,000,001 and above||70,000|
A notice of the branch office registration will be issued one working day by the SSM once all documents are completed and submitted.
Post-registration requirements and compliance
Appointing a company secretary
The company must appoint a company secretary within 30 days after registering the company with the SSM. The company secretary must be registered with the SSM and has a practising certificate that is issued by the SSM.
Opening a bank account
When you have registered your company in Malaysia, you can open a corporate bank account. We recommend researching for a suitable bank as different banks provide different benefits and fees.
There are many local and international banks you can choose from, some are:
- CIMB Bank
- Public Bank Berhad
- RHB Bank
- Hong Leong Bank Berhad
- UOB Bank
- HSBC Bank
Documents required when opening a business bank in Malaysia
The following documents are required to open a corporate bank account:
- Completed application forms from the bank
- Letter of introduction and recommendation from an existing customer of the bank (some banks require this, some do not)
- Photocopy of directors and authorised signatory’s identification cards
- Certified true copy by the company secretary of:
- Company’s constitution
- Section 78 – return of allotment of shares
- Section 58 – list of directors
- Section 46 – registered office address
- Section 17 – certification of incorporation
- Resolution from the board of directors to open an account and the list of authorised signatories
Setting up a subsidiary company is a good choice for foreign entities that want to expand their business to Malaysia.
The registration procedure is rather simple considering that you have all documents prepared for registration. However, if you need guidance when registering your company, feel free to contact Acclime as we are always willing to help you.
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