What Business Owner Should Know About Starting a Small Business in Malaysia
Most prospective small business owners will find Malaysia quite attractive for starting a business. This applies to both newly arrived foreigners and expatriates already residing in Malaysia. The different industries in Malaysia are lucrative, and there is a conducive commercial environment for business. Considering these factors, it is reasonable to conclude that you wouldn’t regret company incorporation in Malaysia. Although starting a business in Malaysia is not particularly difficult, it can still be quite challenging. This is especially true if you lack sufficient knowledge of business and how to register a new company in Malaysia.
This article focuses on the process of registering a company in Malaysia and will guide you on how to start your business in Malaysia
So take note of the following things that you should know about starting your own small business in Malaysia.
Get to Know and Understand Malaysia
The first step in learning how to register new company Malaysia is to get to know Malaysia and its citizens. It is recommended that you travel around and learn about Malaysia; learn about its urban centres and its rural areas. Familiarize yourself with the country and its people, foods, cultures, regulations, policies, and laws. Familiarise yourself with the country and its people, foods, cultures, regulations, policies, and laws. Most importantly, familiarise yourself with the requirements of registering a new company in Malaysia. At the same time, stay in touch with the trends and tastes, so you know what sells and what doesn’t. You may also collect information from the Internet and speak with the locals.
Prepare a Simple Business Plan
You cannot run a successful business without a solid plan. A business plan might be short-term or long-term. A short-term plan typically spans 1 to 2 years, while a long-term plan usually lasts 5 to 6 years. In your business plan, make sure to evaluate and study the market for your skills, product or service. Identify your competitors and check what they are doing. Who are your potential customers? You also need to calculate the amount of capital required when learning how to register a new company in Malaysia.
Though creating a great business plan may be hard, you can easily find free business plan templates on the Internet. This will help you map out the strategies you need to adopt. Initially, the operation cost might be higher, and the marketing plan may not be practical, requiring financial support. Also, make contingency plans so that if one fails, you can apply the second plan or another alternative business plan.
Decide the Business Type in Malaysia
Before starting the company registration process in Malaysia, it’s crucial to choose the most suitable business structure based on your nationality, business goals, and regulatory requirements.
For Local Entrepreneurs:
Malaysian citizens and permanent residents can register their businesses under several structures, including:
-
Sole Proprietorship
Owned and managed by a single individual. Easy to set up, but the owner is personally liable for debts. -
Partnership
Involves 2 to 20 partners sharing profits, responsibilities, and liabilities. -
Limited Liability Partnership (LLP)
Combines features of a partnership and a private limited company, offering limited liability protection while being flexible in operation.
These types are registered through the Companies Commission of Malaysia (SSM).
For Foreign Entrepreneurs:
Foreigners without permanent residency are not eligible to register a sole proprietorship or general partnership. However, they can establish:
-
Private Limited Company (Sdn. Bhd.)
The most common and preferred option for foreign-owned businesses. Requires at least one director residing in Malaysia and one shareholder. It offers limited liability protection and allows 100% foreign ownership in many sectors. -
Labuan Company
Suitable for international business, trading, or holding companies. Labuan entities enjoy preferential tax rates and are regulated by the Labuan Financial Services Authority (Labuan FSA). -
Representative Office or Regional Office
For foreign companies looking to explore the Malaysian market. These offices are non-commercial and cannot generate income locally.
Choose a Business Name
Choosing a business name is crucial when learning how to register a new company in Malaysia. In fact, one of the toughest steps in how to register new company Malaysia is choosing the perfect business name. You can check with Suruhanjaya Syarikat Malaysia (SSM), the commission for registration of businesses in Malaysia, on their website. You can also get a local agency to make enquiries about how to register a new company in Malaysia.
Run a name check after you have handpicked the business name. You can complete the Request for Availability of Name (Form 13A of the CA) and submit it to SSM. You need to pay a fee of RM30.00 for each name applied. After the name check, you can register the name with the Commission for Registration of Business Malaysia, SSM, to get approval. If the Commission approves your name for the registration of a business in Malaysia, SSM, it will be reserved for three months.
Scout for a Business Premise
A good business location is part of your marketing strategy. Therefore, it’s paramount to conduct adequate research in order to pick the best location for your business. Not only is the country where your business is located important, but the actual town, area, street, and office number are important.
In Malaysia, every business must have a legally registered local office address. Some of the important points to consider when scouting for a location are:
- Convenience
- Ease of finding
- Traffic flow
- Logistics
- Transportation
- Parking
- Proximity to various other facilities and available amenities
Prepare the Incorporation Documents for Registration of Business in Malaysia
You need to submit the Incorporation Documents to the commission for the registration of the business in Malaysia, SSM, within 3 months from the approval date of the company’s name. Failure to lodge your incorporation documents will result in you needing to apply for a new name search. Documents required by the agency for registration of a business in Malaysia include:
- Memorandum and Articles of Association/Constitution
- Statutory Declaration by a Director or Promoter before Appointment
- Declaration of Compliance
- Company Name’s approval letter from SSM (one copy)
- Identity Card of every director and company secretary (one copy each)
Once you have fulfilled all requirements and paid the company registration fee of RM1,000 to the SSM, you will get your new business registration certificate within one hour.
Ready to Start a Business in Malaysia?
Frequently Asked Questions
Start with a name search and reservation via the SSM portal (MyCoID or EzBiz). After approval, prepare incorporation documents such as the company constitution, director/shareholder details, and paid-up capital declaration. Submit these along with registration fees to the Companies Commission of Malaysia (SSM). Once approved, you receive a business registration number and certificate within 1–7 days.
The minimum paid-up capital is just RM 1. However, practical requirements—especially for foreign-owned companies in specific sectors—may be higher (typically RM 500,000 to RM 1 million) to comply with industry-specific regulations.
At least one director must be a resident in Malaysia, aged 18 or above. Foreign directors are allowed, but you must meet residency requirements via work passes or local appointments. Companies also must appoint a qualified company secretary within 30 days of incorporation.
Options include:
- Sole Proprietorship or Partnership (simplest form, but unlimited liability)
- Limited Liability Partnership (LLP) (flexible, limited liability)
- Private Limited Company (Sdn. Bhd.) (corporate entity with limited liability and credibility)
Choose based on liability, compliance burden, and intended scale.
Typically 1 to 7 business days, depending on document preparation, the speed of name approval, and SSM processing. Using professional advice can significantly reduce delays.