Company Formation in Malaysia
Forming a company in Malaysia involves several key steps and adheres to specific regulations under the Malaysian Companies Act. Here’s a general overview of the process:
- Company Name Search and Reservation:
- The first step is to decide on a company name and ensure it is unique and acceptable by the Companies Commission of Malaysia (SSM). You can conduct a name search through the SSM’s e-Service portal. Once a name is approved, it is reserved for 30 days.
- Decide on the Type of Company:
- Determine whether you want to register a private limited company (Sendirian Berhad or Sdn Bhd), a public limited company (Berhad or Bhd), or a limited liability partnership (LLP), among other types. Most small to medium-sized businesses opt for the Sdn Bhd structure.
- Preparation of Company Documents:
- Prepare necessary documents, including the Memorandum and Articles of Association (M&A), which outline the company’s constitution and rules. Nowadays, under the Companies Act 2016, the requirement for M&A has been replaced with a single document called the constitution, though it’s not mandatory for private companies unless expressly required by the shareholders or SSM.
- Appointment of Directors and Company Secretary:
- Appoint at least one director who is a resident in Malaysia (either a Malaysian citizen or a person with a permanent resident status) and a company secretary who is a member of a professional body prescribed by the Ministry of Domestic Trade and Consumer Affairs or licensed by the SSM.
- Registration with the Companies Commission of Malaysia (SSM):
- Submit the incorporation documents, including the application for registration, the declaration by a director or promoter before appointment, and the statutory declaration by a secretary or director, to SSM within 30 days from the date of approval of the company’s name. This can be done online through the MyCoID portal or manually at SSM’s counter.
- Opening a Corporate Bank Account:
- Once your company is registered, you will need to open a corporate bank account. Banks will require your company registration documents and details of directors and shareholders.
- Tax Registration, EPF, SOCSO, and EIS:
- Register with the Inland Revenue Board of Malaysia (LHDN) for tax purposes, the Employees Provident Fund (EPF), the Social Security Organisation (SOCSO), and the Employment Insurance System (EIS) for employee benefits and contributions.
- Compliance and Annual Requirements:
- Ensure ongoing compliance with Malaysian corporate laws, including annual returns, audited financial statements (for companies that meet certain criteria), and other statutory requirements.