Malaysia as a new highlight in the economics of the ASEAN is a prospective place to set up a company. A lot of business owners around the world compete to set their camp on it as a company. The interesting question popping up is “how to incorporate business in Malaysia?” This question should be answered in advance so no unnecessary, time-wasting questions appear in the future where mistakes mean loss of money.
Requirements to Incorporate Business in Malaysia
Prior to discussion about how to incorporate business in Malaysia, we should know the definition of company itself in Malaysia. There are two types of company eligible for company incorporation: (1) a company limited by shares, and (2) an unlimited company. The business owners can determine whether their company will be incorporated as a private company (Sdn. Bhd. / Sendirian Berhad) or public company (Bhd. / Berhad). The requirements of both companies are the same, including:
- Two shareholders (Section 14CA)
- Two directors (Section 122)
- A company secretary, a member of a professional secretarial firm under the Minister of Domestic Trade Cooperative and Consumerism, or an individual licensed by SSM.
Note: Both the directors and company secretary must have their only residence in Malaysia.
Once the business owners fulfilled the requirements, they will likely hand over the rest of the secretarial matters to the company secretary. There would be two important steps in company incorporation: (1) application of name search, and (2) lodgement of incorporation documents.
Application of Name Search
This step is conducted to determine the availability of the proposed name. The business name must initiate the step by the completion and submission of Form 13A CA to SSM and a fee of RM 30.00 per each name. After approved by SSM, the name will be reserved for three months from the date of approval. This period will be used for completing and submitting documents necessary to incorporate business in Malaysia.
Lodgement of Incorporation Documents
This step is so crucial because the failure will cause an obligation to repeat the whole process from the application of name search. So, all documents must be completed and submitted within 3 months. The documents include:
- The Memorandum and Article of Association stamped at RM 100.00.
- Form 48A
- Form 6
- An original of Form 13A
- A copy of the approval letter from SSM
- A copy of the identity card (usually passports) of directors and company secretary
The whole process of company incorporation is completed with the release of a Certificate of Incorporation by SSM. This procedure can be used to incorporate business as an unlimited company or company limited by shares. However, for an unlimited company, the Memorandum and Article of Association must contain the liability of each member.
- Form 13A CA (Request for Availability of Name)
- Form 48A (Statuary Declaration By A Director Or Promoter Before Appointment)
- Form 6 (Declaration of Compliance)