Foreigners Registering Sdn Bhd in Malaysia: 7 Requirements

What Are the 7 Requirements for Foreigners to Register an Sdn Bhd in Malaysia?

Seven requirements apply:

• an approved company name
• one resident director
• at least one shareholder
• a licensed company secretary
• a local registered office
• stipulated paid-up capital
• verified KYC documents

Malaysia recorded net foreign direct investment inflows of RM51.5 billion in 2024, according to the Department of Statistics Malaysia. That was a sharp rise from RM38.6 billion the year before.

Foreign investors can own 100% of a private limited company (Sdn Bhd) in most sectors under the Companies Act 2016. That openness is a big part of the confidence behind those inflows.

To set up company in Malaysia as foreigner, every application passes through the Companies Commission of Malaysia (SSM). Its MyCoID portal handles the process end to end, from name search to incorporation.

In this guide, we explain the seven statutory requirements every non-resident founder must satisfy. They cover name approval, a resident director, paid-up capital and KYC documentation before your Sdn Bhd can legally trade.

Approved Company Name

30 days is how long the Companies Commission of Malaysia (SSM) reserves an approved name for incorporation. Before incorporation, you must secure formal name clearance from SSM through the MyCoID portal. The proposed name cannot be identical or confusingly similar to any existing registered company. That 30-day reservation can be extended once by a further 30 days if you apply through MyCoID before it expires. Separately, the incorporation documents must be submitted within 3 months of the name approval. If that deadline lapses without an extension, a new name search is required, delaying your launch.

At Least One Resident Director

At least 1 director who ordinarily resides in Malaysia is required for every Sdn Bhd. The director must be a natural person aged 18 or above and not an undischarged bankrupt. He or she must also avoid the disqualification grounds under section 198 of the Companies Act 2016. These include certain criminal convictions, such as those involving fraud or dishonesty. Residence is evidenced by the director's principal place of living in Malaysia, which SSM verifies at filing. Foreign founders who incorporate a company in Malaysia as a foreigner can satisfy this rule another way. A common solution is appointing a nominee director in Malaysia when no local candidate is available.

Minimum One Shareholder

An Sdn Bhd needs a minimum of 1 shareholder and a maximum of 50. Shareholders may be individuals or corporate entities, and 100% foreign equity ownership is permitted in most sectors. However, some regulated sectors restrict foreign equity under sector-specific licences. Banking, education, oil and gas, and parts of agriculture are common examples. The required local share varies by licence and subsector within each industry. Check the rules for your sector, because choosing the right business structure matters before you commit.

Licensed Company Secretary

Malaysian law gives you 30 days to appoint a company secretary. The appointee must be licensed by SSM or be a member of a recognised professional body. The secretary maintains statutory registers, files annual returns and keeps your compliance calendar on track. Foreign directors usually engage a Corporate Services Provider in Malaysia to handle secretarial duties and ongoing SSM filings.

Local Registered Office Address

Exactly 1 registered office in Malaysia is required for every Sdn Bhd. It must be a physical premises — SSM does not accept P.O. boxes. Statutory records must be kept there. Official notices from authorities such as SSM and the Inland Revenue Board (LHDN) are received there. A business address may differ from the registered office, and many foreign owners use their provider's address for this purpose.

Stipulated Paid-Up Capital

The statutory minimum paid-up capital for an Sdn Bhd is RM1. In practice, foreign-owned entities face higher thresholds:

• RM1,000,000 for import, export or trading licences
• RM500,000 for advisory businesses
• RM250,000 to RM500,000 for an Employment Pass

These thresholds are set by the Expatriate Services Division (ESD) and licensing authorities, not SSM. Declaring inflated capital is a legal offence.

Verified Identity and KYC Documents

Section 201 of the Companies Act 2016 requires a statutory declaration from every director. Foreign founders must also submit supporting documents:

• certified passport copies for all directors and shareholders
• proof of residential address
• a declaration of compliance with the Companies Act

To incorporate a company in Malaysia as a foreigner, you will need these KYC documents ready. They let SSM verify identity and beneficial ownership. In practice, we help clients prepare error-free submissions to avoid the most common causes of rejection.

Frequently Asked Questions