ASEAN Connected: Malaysia Business Guide

ASEAN Connected: Malaysia Business Guide

Malaysia is the fifth largest recipient of foreign direct investment (FDI) inflows in the world, in accordance with the United Nations Conference on Trade and Development (UNCTAD) 2015 World Investment Report. In 2015, FDI inflows into Malaysia reached MYR39.5 billion, 11.8 per cent higher than that recorded for 2014.

Malaysia ranked 18th in the World Bank's 2016 Doing Business rankings, falling one place from 17th in the year prior. This puts Malaysia as the second easiest country to do business among the ASEAN nations, behind only Singapore. The rankings recognised a number of reforms enacted in 2015 which made doing business easier. This included making paying taxes easier and less costly for companies by making electronic filing mandatory and reducing the property tax rate. Nevertheless, at the same time, Malaysia also increased the capital gains tax.

Key facts about starting a business in Malaysia:

  • It takes, on average, three procedures and four days to start a new business in Malaysia; this process is detailed in the Doing Business in chapter
  • The processing fee for an employment pass application is MYR125, and the fees for the pass itself are up to MYR300 per annum; employment regulations are discussed in detail in the Labour chapter
  • Submitting and obtaining development approval through the One Stop Centre (OSC) for a construction permit takes approximately 30 days and costs MYR3,180
  • Foreign companies operating in Malaysia must file statutory financial statements annually to the Registrar of Companies within two months of their AGM; further details can be found in the Audit chapter
  • Companies that wish to list securities on the Bursa Malaysia can choose between the Main Market; for companies with a profit track record of three to five financial years or the ACE Market, for companies from all business sectors with promising growth potential; this is discussed further in the Finance chapter
The HSBC guide has been developed to provide businesses with an overview of Malaysia, its Legal regime, start-up and market entry considerations, tax and customs requirements and a general summary of the factors that may affect the decision to do business in Malaysia. However, the information contained in this document is generic in nature and you should not act or rely on it without obtaining specific professional advice.


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