Setting up Sdn. Bhd. for foreigner

A Sdn. Bhd. is a private company limited by shares where its shareholders’ liability is limited to the amount of shares held. It is a separate legal entity with full capacity to undertake business activities and transactions including to sue or be sued and manage properties.

To incorporate a Sdn. Bhd., one must be at least 18 years old, reside in Malaysia, and is not disqualified under Section 198 of the Companies Act 2016.

Section 198 described that, a person shall not hold office as a Director of a Company or whether directly or indirectly be concerned with or takes part in the management of the Company , if the person

a) is an undischarged bankrupt,

b) has been convicted of an offence relating to the promotion, formation or management of corporation

c) has been convicted of an offence involving bribery, fraud or dishonesty

d) has been convicted of an offence under Section 213, 217, 218, 228 and 539 of Companies Act, 2016 or,

e) has been disqualified by the court under Section 199 of Companies Act, 2016

At least 1 director with Malaysia residency status is needed to incorporate a Sdn. Bhd.

Yes, a foreigner can become a sole director so long he/she resides ordinarily in Malaysia. The residency status can be proven with tenancy agreements, utilities bills or bank statements.

Unfortunately no. According to the Companies Act 2016, there must be at least 1 director who ordinarily resides in Malaysia in order to register a Sdn. Bhd. This could be yourself or other Directors of the business.

Yes, a corporation can be shareholder in Sdn. Bhd.

During the initial stage of formation, the capital range may between RM1.00 up to RM10,000.00.

Yes, the Company may do so provided bank account has successfully opened as bank statement is required to be shown as a proof fund injected to the Company bank account.

According to Section 236 of the Companies Act 2016, all Sdn. Bhd. must appoint a company secretary within 30 days from its date of incorporation.

A Company’s registered address is usually where the Company Secretary’s office is located at, which shall be open and accessible to the public during ordinary business hours. This is where all Company documents, as ordered by the Companies Act 2016, shall be kept at.

Meanwhile, business address is refer to the place where Company undertakes business activities.

Switching the type of business structure is not possible as they are different entity. Nevertheless, one can incorporate a new Sdn. Bhd. and run the business as a new company before termination the existing Enterprise, Partnership or Limited Liability Partnership.

Yes, you can. However, there is a holding period of 2 years before the existing Sdn. Bhd. name can be re-used by a new entity again.