Unless otherwise indicated, the Malaysia company stated in this article refers to a private company limited by share(s) (identified through the words ‘Sendirian Berhad’ or ‘Sdn. Bhd.’)  formed and incorporated in Malaysia in accordance with the Malaysia Companies Act 2016.

After incorporation, a company is advised to obtain the necessary license/permit/approval from the relevant authorities before commencing business. The type of business licenses that a company needed is depending on the industry that the company is involved in. Business licenses can be broadly divided into 3 different logical groups, namely general licenses, industrial or sector specific licenses and activity specific licenses. The requirements for Malaysia business licenses application may vary according to each local authority.

1. General Licenses
   
   General licenses include the necessary business licenses and will apply when the investor decides to start a business in Malaysia.
   
   

   (1)	Company Registration A business owner can register a company with the Companies Commission of Malaysia with or without a company secretary at the time of incorporation by gathering all the information regarding the proposed company name, registered office, business address, share capital, shareholder(s), director(s), business nature and description. Nevertheless, the board of directors of the company must ensure that a company secretary is appointed within 30 days from the date of incorporation of the company.
   (2)	Business Premise License and Signboard License Company with business premises and signboard are required to apply for premises and signboard licenses which are valid for a period of 6-12 months from the respective local town councils (depending on the location of the business premises of the company) prior to starting their businesses.
   (3)	Company and Employee Income Tax Registration Registration of company's tax file is the responsibility of the individual who managing and operating the company. When a company commenced operations, they need to apply for registration of a tax file. The registration can be done online through e-Daftar or you can apply in writing to the nearest branch to your correspondence address or at any Inland Revenue Board of Malaysia branch.
   (4)	Employees Provident Fund (EPF) EPF is a retirement benefit scheme in Malaysia which is available to all salaried employees who work in the private sector. An employer shall register with the EPF within 7 days from the date the employer becomes liable to contribute, that is as soon as an employee is employed. Applicant would know the status of registration application automatically during registration through the notification status whether successful or rejected.
   (5)	Social Security Organisation (SOCSO) The employers who employ one or more employees are responsible to register and contribute to SOCSO based on the rates specified under the Employees’ Social Security Act, 1969, administered by SOCSO. New employer and employee must be registered with SOCSO within 30 days upon hiring a new employee. For registration purpose, an employer is required to complete the relevant forms alongside other documents online.
   (6)	Human Resources Development Fund (HRDF) This is a training fund that has been established for skills development in Malaysia. It is operated through a levy grant system in which companies pay a training levy into the fund. The levy payers (employers) train their citizen employees and are reimbursed for costs they incurred for training. For employers with 10 or more Malaysian employees, it is compulsory to registered with Human Resource Development Corporation (HRD Corp). The monthly levy is charged at the rate of 1% of the monthly wages of employees. Employers with 5 to 9 Malaysian employees are given option to register with HRD Corp and if they choose to register, the monthly levy is charged at the rate of 0.5% of the monthly wages of employees. The application can be done online and it will be reviewed by the officers within 30 days and a confirmation email will be sent to the company.

   
   
2. Industrial or Sector Specific Licenses
   
   These licenses are applicable for a particular industry or sector determined by the government. This includes the policies governing the development of a specific industry or sector in line with the development of government policy.
   
   You may refer to the MalaysiaBiz in order to ensure which Government Department Authority should you liaise with in regard to the Industrial or Sector Specific Licences.
   
   Here are some of the Industrial or Sector Specific Licences:
   
   

   (1)	Manufacturing License This license is required for a company with shareholders’ funds of RM2.5 million and above or employing 75 or more full-time paid employees to conduct manufacturing activities in Malaysia. Additional eligibility criteria: The minimum Capital Investment Per Employee (CPE) for the project needs to be RM140,000.00. Total full-time workforce of the company comprises of at least 80% Malaysians. At least 25% of the company’s full-time workforce are managerial, technical, and supervisory staff with degree and/or diploma/certificate or product’s value added is at least 40%. The application for a manufacturing license will be done online by providing information relating to the company, project cost, project financing, manpower, specific industry etc. The Malaysian Investment Development Authority (MIDA) usually takes about 3 to 6 months to grant the approval. This license can only be applied once the company has obtained the business premise license and signboard license.
   (2)	Wholesale Retail Trade (WRT) License This business license applicable to a foreign-owned company intending to engage in distributive trade services in Malaysia, namely (1) retail, import & export, distributive trade; (2) restaurant; (3) franchise; (4) services & consultancy. Foreign-owned companies refer to companies in which more than 50% of its total shares are owned by non-Malaysians. The WRT license is required by all the said business sectors before they can apply for a professional work permit. The minimum paid-up capital required for the application is RM1 million. The company must have a business premise license and a valid rental agreement and telephone line before it can apply for the WRT license. For newly incorporated company, you may be able to submit with a business plan and investment plan in Malaysia prior setting the office. The application will take approximately 1 to 2 months to complete. A WRT license has a validity period of 2 years. Renewal applications must be lodged 3 months with Ministry of Domestic Trade and Consumer Affairs (MDTCA) before the expiration date.
   (3)	Licenses related to the Telecommunication and Broadcasting Sectors An applicant who wishes to provide network facilities and/or network services/and or content applications services which requires a license will have to submit the application with Malaysian Communications and Multimedia Commission.
   (4)	Licenses related to the Oil Exploration Sector For companies which want to set up oil and gas reserves in Malaysia, they are required to sign a production sharing agreement with the Malaysian state oil company Petronas.
   (5)	Licenses related to the Construction Sector A local or foreign entrepreneur who wants to start his/her construction business in Malaysia needs to apply for license from Construction Industry Development Board (CIDB). The following categories need to be considered when applying for a CIDB license in Malaysia, i.e. building construction, civil engineering construction and electrical and mechanical construction.
   (6)	Licenses related to the Banking Sector According to the Law on banking and financial institutions of 1989, the Central Bank of Malaysia authorizes and regulates companies such as banking services, money brokerage, discount houses, provision of loans and finances, banking activities for traders, deposit and certain other financial affairs.
   (7)	License under Department BLESS, Ministry of Entrepreneur Development and Cooperatives (MEDAC) Business Licensing Electronic Support System (BLESS) system is One Stop Online Service or Online Service Center for information (BLESS Portal) and to apply for license / permit / permission (BLESS Application) related to business in Malaysia. BLESS system also provides Ministries/Agencies services to process and approve online applications of licenses/permits/approvals.
   (8)	License under the Department of Occupational Safety and Health Malaysia (DOSH) DOSH is the government agency that enforces legislation related to the safety and health of workers. To ensure smooth enforcement, the following is a list of registration requirements with the Department: (a) Factory registration (b) Machinery registration (c) Construction site registration (d) Registration of workplaces of other sectors
   (9)	License under the National Water Services Commission (SPAN) The SPAN license is a water and sewerage licence issued by the Malaysian state of Selangor. It allows for the construction and operation of water and sewerage works within the state.

   
   
3. Activity Specific Licenses
   
   Activity-Specific licenses are licenses that regulate particular activities and could be applicable to one or more Industries or Sectors.
   
   This category of license requires investor to comply with sets of specific guidelines designed to protect the interest of the citizen, employment, safety of workers, environment and general public.
   
   Examples of Activity-Specific Licenses are:
   
   

   (1)	Certificate of Fitness for Certified Machinery
   (2)	Approval for Expatriate Posts
   (3)	Approval to install/resite/alter Air Pollution Control Equipment (bag filter and chimney)
   (4)	Building Plan Approval
   (5)	Sales Tax License

Disclaimer All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.

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