How to Open a Company in Malaysia in 2025

2025-08-19

6 minute read

open a company in Malaysia

Starting a business in Malaysia is an attractive option for many foreign entrepreneurs, especially if you have a well-developed business idea.

Malaysia offers a straightforward registration process, 100% foreign ownership in most sectors, and a supportive business environment. With its strategic location in Southeast Asia, Malaysia serves as a gateway for those looking to tap into both local and regional markets.

Whether you’re aiming to establish a small business locally or looking to use Malaysia as a launchpad for regional expansion, this guide will provide the clarity and steps you need to set up your business in Malaysia, from reserving your company name to receiving your official Certificate of Registration.

What to Do Before You Register Your Business

Before getting started on the registration process, there are a couple of things you need to be do, so as to expedite the registration.

1. Decide on Your Business Structure

When starting a business in Malaysia, foreign entrepreneurs have several business structure options to choose from, depending on their ownership goals, business needs, and legal requirements.

The four primary options are Sdn Bhd (Private Limited Company), Foreign Branch Office, Sole Proprietorship, and Partnership.

Note that Sole Proprietorship and Partnership are only available to Malaysian citizens and foreigners with Permanent Residency (PR).

Below is a comparison of the available business structures:

Business Structure Description Key Considerations
Private Limited Company (Sdn Bhd) A separate legal entity where ownership is divided into shares, providing limited liability to its shareholders 100% foreign ownership (unless in restricted sectors)
Separate legal entity with limited liability.
Requires at least one director who resides in Malaysia
Qualifies for local tax incentives and benefits (subject to industry)
Foreign Branch Office A direct extension of the parent company, operating under Malaysian law but controlled from abroad 100% foreign ownership (unless in restricted sectors)
Parent company holds full liability
Requires a local representative
Can only conduct the same business activities as the parent company
Typically does not qualify for local tax incentives or benefits
Sole Proprietorship A business owned by a single individual Requires Malaysian PR
No legal distinction between the owner and the business
Unlimited liability; owner is personally liable for business debts
Partnership A business structure involving two or more individuals Requires all partners to be either Malaysian citizens or PR
Profits and liabilities are shared between partners
Unlimited liability; partners are personally liable for business debts

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2. Choose a Business Name

Choosing the right business name is an essential part of setting up your company in Malaysia, but it must adhere to the guidelines set by the SSM:

  • Uniqueness: Your company name must be distinct and not identical to an existing name in the SSM database or a name currently being reserved.
  • Avoiding Offensive Terms: The name should not contain offensive or inappropriate language that could be deemed as disrespectful to any community or religion.
  • Relevance to Business: Your name should reflect the type of business you are conducting. Names that are too general, such as “Beautiful Sdn. Bhd.” or “International Trading Sdn. Bhd.”, are discouraged.
  • Proper Grammar and Spelling: The name must adhere to proper grammar and spelling, especially when using a mix of Malay and English in the business name.
  • Restricted Words: Some words, such as "Malaysia", "Bank", and "University", are prohibited unless you obtain approval from the relevant authorities or government bodies. Similarly, names associated with political parties or government agencies are not allowed.
  • Symbols and Special Characters: Certain symbols like "&", hyphens, and brackets are allowed, but must be used correctly in context.
  • No Acronyms for Educational Institutions or Government Entities: You cannot use acronyms that resemble names of higher education institutions, government agencies, or international organisations (e.g., UNESCO, NATO).
  • Use of Personal Names: If you want to use the name of a director or their family members, consent must be obtained.
  • Foreign Company Names: If you are registering a foreign company, the name must match the one used in your country of origin.

You can easily check the availability of your chosen business name and reserve it through the MyCoID 2016 portal.

3. Prepare Incorporation Documents Beforehand

As part of the company registration process, you will be required to submit various documents to SSM. To ensure a smooth and efficient process, it's wise to prepare them beforehand.

Some of the documents you might be asked for include:

  • Identification documents of all shareholders and directors (MyKad for Malaysians, passport for foreigners)
  • Application for registration of the foreign company under section 562(1) CA 2016
  • Certified copy of the foreign company’s certificate of incorporation or registration
  • Certified copy of the foreign company’s charter, statute, or constitution (e.g., Memorandum and Articles of Association)
  • A memorandum stating that directors residing in Malaysia can exercise their powers on behalf of the foreign company
  • A memorandum of appointment or power of attorney authorising the local agent in Malaysia to accept notices on behalf of the foreign company
  • Application for name reservation and a copy of the approval email from SSM

Additionally, any documents not in Bahasa Malaysia or English must be accompanied by a certified translation.

Process for Starting a Business in Malaysia

Starting a business in Malaysia is simple, but understanding the steps is key. This guide will walk you through the essential stages, from reserving your company name to receiving your Certificate of Registration.

Let’s get started with the first step.

Step 1: Sign Up for a MyCoID 2016 Account

Before starting the process, you must sign up for a MyCoID account on the official MyCoID 2016 portal.

​​MyCoID 2016 is the official online platform provided by the Companies Commission of Malaysia (SSM), the government agency responsible for business registration. All company registration processes, including name reservation and document submission, will be handled through this platform.

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MyCoID automatically links your company to key government agencies, such as the Employees Provident Fund (EPF), Inland Revenue Board (IRB), and Social Security Organisation (SOCSO), with registrations completed simultaneously during company incorporation.

Step 2: Reserve Your Company Name

To begin your company registration in Malaysia, you must first reserve your company name.

If you're registering a foreign branch office, the name used in Malaysia must match the name registered in your country of origin. For locally incorporated companies, the name must still be unique and comply with local guidelines.

As a reminder, these are some key examples of the naming rules:

  • Use correct spelling and grammar, and clearly indicate the type of business
  • Avoid names that are offensive, misleading, or suggest a connection to government or royalty
  • Include the meaning if using foreign or created words
  • Only limited symbols such as & - ’ ( ) are allowed in company names

Once your name is approved, it will be reserved for 30 days, with an option to extend it for an additional fee. This step is essential for proceeding with the next stages of registration.

Step 3: Submit Incorporation Documents

After your company name has been approved, you must submit the required documents within 30 days via the MyCoID portal.

This includes essential documents such as your company’s certificate of incorporation, Articles of Association, and a memorandum stating that directors residing in Malaysia can exercise their powers on behalf of the company.

Once submitted, the SSM will review your documents and begin processing your company registration.

Step 4: Pay the Registration Fees

Once your incorporation documents have been submitted, the next step is to pay the registration fee of RM 1,000.

Once the payment is made and the registration process is complete, SSM will issue a Notice of Registration within one working day. The Certificate of Registration can be obtained upon request, along with the prescribed fee.

What to Do After Registering Your Business

After successfully registering your company, there are a few additional steps to complete before you can fully start operating. These post-registration considerations ensure your business complies with local regulations and is set up for smooth operations.

1. Open a Corporate Bank Account

A corporate bank account is crucial for all business transactions, including paying taxes, managing operations, and maintaining financial transparency.

To open a bank account in Malaysia, you will need identification documents for all directors and authorised signatories, such as MyKad, MyPR, or a passport, along with proof of address. Non-residents may be asked to provide additional documentation, such as work permits, active visas, and a reference from a local contact.

Banks will also require your company’s Articles of Association, Certificate of Incorporation, Business Registration, and a Board of Directors’ Resolution. Depending on the bank, you may need to submit further business-related documents to complete the account opening process.

Some banks may require in-person verification, so it’s advisable to check in advance and ensure you have all necessary documents prepared.

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Tip: Consider using neobanks as an alternative to traditional banks. They offer fast, cost-effective solutions for managing business finances and can be a great option for businesses that operate internationally.

2. Apply for A Business License

Depending on your business type, you may need specific licenses or permits to operate legally in Malaysia. Industries such as food and beverage, retail, manufacturing, construction, and healthcare often require additional approvals from local authorities.

To apply for a business license, visit the local council responsible for your business’s location (e.g., MBJB, MBIP). You will need to submit your business registration details, proof of premises, and identification documents, along with any industry-specific requirements. Some businesses may also be subject to a site inspection.

In addition to the business license, certain sectors may require additional permits, such as health or safety approvals. Be sure to check the specific requirements for your industry to ensure full compliance.

Start Your Business in Hong Kong Instead

While Malaysia offers benefits for entrepreneurs, Hong Kong goes further with its low tax rates and status as a global financial hub. It offers strategic access to Asia and provides businesses with the flexibility to expand internationally with fewer regulatory hurdles.

Here are some key advantages of choosing Hong Kong:

  • Low tax: Hong Kong applies a two-tier profits tax system (8.25% on the first HKD 2 million of profits and 16.5% for profits above that threshold) compared to Malaysia’s 24% corporate tax rate.
  • No consumption tax: Hong Kong does not impose VAT or GST, whereas Malaysia imposes a Sales and Services Tax that ranges from 11% to 18%, depending on the type of goods or services.
  • No minimum capital: Hong Kong has no paid-up capital requirement, making it easier to start your business with minimal investment.
  • Support for foreign enterprises: Hong Kong offers several government initiatives, such as the StartmeupHK initiative, as well as funding options and networking opportunities for foreign investors and SMEs.
  • Highly developed infrastructure: Hong Kong's world-class infrastructure, including efficient transport links and banking services, ensures smooth business operations.
  • Global access: Hong Kong provides easy access to Asia, with strong business links to key markets like China and Singapore, making it ideal for business owners looking to expand regionally and internationally.

At Statrys, we offer an all-in-one Hong Kong company incorporation package with transparent pricing that covers every stage of the process, from document preparation to company secretary to setting up your Statrys multi-currency business account. The entire process can be completed 100% online in 5 days or less, subject to approval.

FAQs

Can foreigners start a business in Malaysia?

Yes, foreigners can start a business in Malaysia. They can either incorporate as a private limited company (Sdn Bhd) or register a foreign branch office, with 100% foreign ownership in most sectors. If they have Malaysian PR, they have the additional option of Sole Proprietorship and Partnership.

How do I register a company with SSM in Malaysia?

How long does it take to register a company in Malaysia?

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