Nominee Director Services

• Professional support and compliance
• Bear interest of nominator
• Attend and participate in board of director meetings  
• Maintain confidentiality
• Other duties that have been assigned

Nominee directors are usually appointed by foreign investors, shareholders, or financial organizations termed nominators in pursuit to represent their interests and perform specific duties.

Absolutely! We are a team of skilled professionals who could act as your nominee resident director either on a short-term or annual basis. Rest assured that the duties and responsibilities are met with excellence.

According to the new Section 217 Companies Act 2016, the appointed representative or nominee director should act in the best interest of the nominator. Failure to compromise is subject to imprisonment and a fine of up to three million ringgit.

They can only be removed by the specific person or organization who appointed them. Nominee directors cannot be removed by the directors or members of the company.

Filing for termination requires a formal process and fulfillment of necessary paperwork. Thus, you are unable to legally remove a nominee director just because you want it. You can file for a termination of service anytime, but it’s important to provide the details and documents.

The appointed nominee director should abide by the rules of the private limited company just like any other director. Thus, they don’t act independently and should keep the confidentiality of the management.

Yes. The nominee director will ensure that the company complies with the AGMs and other important requirements such as annual returns. We can assist you to find a reliable person for the convenience and development of your operations.

A nominee director could participate in meetings and execute his or her expertise in the field while prioritizing the interest of the nominee. They take part in the development of the company’s corporate practices by suggesting a critical analysis of the market.

Yes. It is legal in Malaysia to engage with nominee directorial services. Since they provide good services, it is recommended that you sign agreements with the provider.

While nominee directors’ primary role is to sustain fiduciary duties, they are also expected to ensure corporate governance and adopt ethical practices in pursuit of fulfilling social responsibilities.

No. The role of a nominee director does not include financial aspects such as signatory on the invoice and bank matters. They are appointed to fulfill statutory compliance and perform fiduciary duties.

Should you engage with our nominee directorial services, an agreement form detailing the services would be signed by both parties. Contact us for more information.

No. Terms and conditions applied in being a nominee director include not holding shares or credit of the company.

• An agreement following the legal provisions of the state
• Nomination letter
• Resolution documents

The services provided by the nominee directors are leveled but not merely restricted to statutory regulations. Hence, it gives you full assurance that the management is under your control. Decision-making is up to you.

While nominee directors are skilled professionals in the field, most agreements don’t include signatories and involvement in business operations. This is to ensure privacy and full control of the management despite appointing directors.

If you’re not a resident of the country and planning to start a business in Malaysia, it’s a requirement to appoint a nominee director to proceed. You should also hire professionals to safeguard your interest and ensure statutory compliance.

We understand that some companies have circumstances that might hinder their registration. Thus, we could assist you by providing nominee director services prior to venturing into the Malaysian market.

Both hold the same duties and responsibilities. However, the appointment of nominee directors is subjected to the details of the Articles of Association of a company. They are professionals embodying the interest of the nominator. Meanwhile, a director is selected to run the operations. They could act as an independent.

Unlike nominee directors, shadow directors are not officially appointed. But they could set on instructions and be acted upon by the board of directors. A nominee director’s role in the company is limited to the agreement of the services.

Keeping the beneficial owners’ private information from the public is part of a director’s obligations. However, if the beneficial owner is proven to violate taxation laws, then the director shall provide the Power of Attorney to the authorities.

It’s a common notion to place details of a nominee when opening company bank accounts. But in terms of signatories such as cheques and money transfers, the real director would have signed. Though there are instances that directors don’t want to reveal themselves through bank transactions. That’s why they appoint reliable nominees as an alternative.

No. You don’t have to pay for the EPF of the nominee director. Fees are only applicable to nominal annual services.

A nominee oversees the operations of the company. Thus, comes up with rational advice while acting as the liaison between the nominator and the company. His or her presence is acknowledged by exhibiting expertise during board meetings.

Yes. It’s part of the prerequisites indicated in the Companies Act. Additionally, the nomination of nominee directors must be signed by the promoters of the organization. You could contact us for the specific format.

• Must be a resident of Malaysia.
• Must not have direct involvement in the management.
• Signed upon the agreement of the state government.

• If your company needs discreet and secured identity protection.
• Compliance with company registration.
• Need a professional to represent a person or group during board meetings.
• To ensure legal provisions and annual compliance.

No, the nominee director cannot manage or involve in the operation of your company.

The nominee director will neither be a bank signatory to the corporate bank account nor play an active role in our Client’s business. The nominee director will merely be the named director of the company in order to fulfill local statutory requirements (e.g., appointment of a local resident director). Our Client is solely responsible for daily business activities and solely responsible for corporate bank account activity. 3E Accounting’s nominee director will not sign any invoice , contract or legal documents on behalf of our Client’s company.

Directors of the company are legally responsible and accountable for complying with the requirements of the Malaysia Companies Act. Failure to comply with the statutory compliance requirements is an offense and may result in fines or prosecution.

Yes, we do provide our Nominee Director Service in Malaysia. However, please note that our nominee director will not have any financial, management or operational interest in the company. The nominee director’s main role is limited to satisfying the statutory requirement of a local resident director for your Malaysia company.

The security deposit should not be confused with our service fee or any other fee. It’s your money that is temporarily in our custody for the duration of our Nominee Director Service. We will refund the security deposit back to you immediately upon termination of our Nominee Director Service.

A5: We understand that we have competitors who are not collecting security deposit, you should always be aware that they usually outsource their Nominee Director services. In the long run, there will be potential risk (e.g. Nominee Director stopped providing service and nowhere to be found). In 3E Accounting, we provide our own Nominee Directors to guarantee our customers’ safety. Besides, there are normally charging higher for their nominee director fee and other fee as well which collectively can be higher than the security deposit which we are collecting.

We will need the security deposit as responsibilities are quite onerous for all directors, including the nominee director. The nominee director is required to pay for company liquidation charges in case the foreign client is no longer reachable. Our Nominee Director Service is provided by our reputable and trustworthy professionals. To safeguard the interests of the nominee director, we require that a security deposit be kept with us for as long as our Nominee Director Service is active.

Choosing between having a local Malaysia nominees or not largely depends on the requirement of the nature of your business. If one not careful on the appointment, the following 4 complications may arise:

– All directors are required to sign company documents for the smallest changes, nominees do not turn up to sign

– Nominees credit score over time is not good, this will affect the health of the company

– Untraceable nominees will lead to unable to do compliance duty with the relevant Governmental Departments, that will cause penalties which is costly range from RM 2,000 onwards

– Dispute to claim of the Company’s authority and shares

A6: We will need the extra security deposit as there are more responsibilities for the nominee director when the Company is GST registered or Hiring of Local and Foreigner Employees.

GST-registered businesses are required to pay the GST one month after the end of the taxation period (either month or quarterly filling) covered by the GST return. If the tax is not paid or is paid late, the penalties will be imposed.

Employers who do not pay, underpay or are late in contributing to their workers’ Employees Provident Fund – EPF accounts could face stiffer penalties, including being jailed.

Besides, Employers need to fulfil the responsibilities/obligations under Income Tax Act such as monthly tax deduction for employee(s), Employer’s tax related filling e.g. Form E, tax clearance for foreign employee and etc. could face stiffer penalties, including being jailed.

# For company with annual turnover expected to exceed RM500,000 and/or intend to register for GST Voluntary or Compulsory, additional security deposit of RM10,000 is required. The Company need to register with GST if the revenue is expected more than RM 500,000.

Yes, you can terminate our Nominee Director Service anytime by providing us with the details regarding an alternate local resident director. We will do the necessary paperwork, file the change with authorities and promptly refund the security deposit back to you.

A8: A power of attorney is a legal document which gives the appointed person the right to represent the company and to act on its behalf. The document lists the terms of the appointment and may allow the attorney to act for the company without requiring the directors.

In most cases, the executive director (foreigner) can represent the company and issue the power of attorney. In the event the nominee director is asked for issuance of power of attorney, We will require to understand the reason for doing so. The nominee director should not involve in your company operation in general.

When a power of attorney is issued, the directors still retain responsibility. Therefore, the nominee director will need to perform some checks before issuance of the power of attorney. Kindly provide the following information about the attorney for our checking purposes.

– Attorney’s passport copy, proof of foreign residential address and national identity card copy, if any

– Attorney’s contact telephone and email

– Attorney’s personal bank reference letter / recent personal bank statement which is less than 2 months

– Attorney’s reference letter from his/her existing employer

– The purpose of issuance of the power of attorney

– Why do you need the power of attorney from the nominee director and not from executive director of the company

We reserve the right to refuse if the proposed attorney does not meet our requirements.

Kindly remind that the nominee director will only give a special power of attorney (also called a limited power of attorney) if required by law. We will need to charge extra fee from RM 3,000 for reviewing the power of attorney by our lawyer and perform checking on the attorney.

It is our Company’s policy that our nominee director will not be involved in your business operation therefore if your business is required to apply for a license, our nominee director will have to step down when you are ready to proceed with the license application. Most license application will need to be signed and submitted by a local key executive personal/director therefore you will need to have such person (either Malaysia Citizen, Malaysia PR, or employment pass holder) to act for your company and apply for the license.Most businesses do not require licenses or permits to operate, there are handfuls that do, as they are regulated by the approving authorities. Some of these are private schools, travel agencies, liquor distributors, moneylenders, banks, childcare centres.

We will provide the local Nominee Director Service for your company, provided the followings conditions are met:

• The service is offered for statutory compliance only. The nominee director will not be involved in any financial or operational matters or management of the company.
• You must appoint one or more individuals (normally, company shareholders) to be the directors that are responsible for running the company operations. Our nominee director will not be involved in your business operation.
• You must satisfy our initial and ongoing KYC requirements.
• Execute our Nominee Director Indemnity Agreement.
• You must subscribe to our annual secretarial service.
• You must subscribe to our annual accounting service (i.e. compilation of financial statement, XBRL services).
• You must subscribe to our annual tax filing service.
• You must subscribe to our GST / SST review & filling service.
• You must subscribe to our registered address service.
• You must subscribe to our payroll service if hiring any staff in Malaysia.
• You must redirect the Company’s bank statement to our nominee director’s office for monthly review.
• You are allowed to maintain one Malaysia Bank Account only in the Company. For the second bank account opening, it is subject to our nominee director approval provided valid reason is given
• Opening of foreign bank account in overseas is subjected to 3E Accounting approval if you are engaging our nominee director services
• The annual audited financial statements of the Company must be finalised and issued within six months of the financial year-end of the Company
• The company to which we are acting as Nominee Director must be solvent before our appointment and the Company shall remain solvent at all times during our term of appointment

Please note that the above conditions are non-exhaustive as other factors may be taken into consideration.

We will also require a refundable security deposit to provide you with the Nominee Director Service. The service can be terminated any time at your request. You, however, must appoint new Malaysia resident director to meet the statutory requirement.

For foreigner who engaged our nominee director services, 3E may request the extra information (if necessary) of the foreign directors and shareholders as follows for Malaysia company formation:

• Director(s), Shareholder(s) and Beneficial Owner(s) personal bank reference letter (see Sample bank reference letter) / recent personal bank statement which is less than 2 months
• For self employed, kindly provide the information about Director(s), Shareholder(s) and Beneficial Owner(s) current businesses / companies (i.e. Company web site, company brochure, certificate of incorporation, business profile, company bank statement, and latest financial statement)
• If Director(s), Shareholder(s) and Beneficial Owner(s) are working, kindly provide the information about their current occupation (i.e. confirmation letter or testimonial from your current employer or your employment contract; and latest notice of personal income tax assessment)
• Kindly provide us the estimated annual turnover of the Malaysia Company. Kindly provide us the estimated breakdown for the revenue generated from Malaysia and Overseas.
• Will the business operation based in Malaysia. If not, do you need a Malaysia bank account. If yes, please provide the reason.
• What is the purpose of setting up the Company in Malaysia (e.g. running of business / investment holding / any other purposes)
• Will you hire any local staff in Malaysia after the Company is setup?

Additional Information required for clients Who Engaged an Agent to act on their behalf

• Agent’s contact information (name, telephone, email, etc.)
• Agent’s Copy of passport, proof of foreign residential address and national identity card, if any
• Agent’s copy of the registration documents containing the Certificate of Incorporation, and Certificate of Incumbency or equivalent document (Click Certificate of Incumbency to download the sample), if any
• Copy of the Authorization letter that the customer has appointed the agent to act on his behalf

We would require the documents and information as listed above as part of our due diligence verification before accepting our engagement as Nominee Directors for your company in Malaysia. This due diligence is very important as it also serves as initial screening to lower the risk of the bank account application being rejected later. Please note our due diligence assessment is very similar to the bank and we have been working closely with our affiliated banker to understand the difficulties in opening bank account for companies wholly-owned by foreigners. With the due diligence assessment, we can proudly say that our clients are of good profile. Hence, you will be protected from risk of our nominee directors (who also act for other clients in 3E Accounting) being dragged into complication/trouble arises within our clientele. In short, it will be easier to open the bank account after your company is registered and be rest assured that we have been assisting a lot of foreigners opening the bank account for private company in Malaysia.

For a merchant bank account which let your business accept credit and debit card payments into your checking account, and receive funds directly through your website, our nominee director will not be able to assist with any account opening application. This is because it will normally require the nominee director to sign, declare and provide certain guarantee before the account can be opened. As our nominee director will not be in an appropriate position to sign, declare and provide guarantee on behalf of the company, the nominee director will not assist with such account opening.

However, your business can consider applying for other payment gateway account (such as paypal, etc) which can be done without any involvement by our nominee director (subjected to paypal approval). Our nominee director will not be able to assist with any such account opening including providing of any personal particulars, due diligence documents or signature on any related documents.