Starting a business can be both exciting and scary at the same time. However, there is no need to be nervous about this after learning all about it in this article.
Malaysia's stable political environment and high economic growth rates is attractive for those looking to start a new business. This article will provide you with a complete step-by-step guide on how to incorporate a company in Malaysia. Get ready to become an entrepreneur!
Before you can start the process of incorporating your company, you must first understand the basic requirements for doing so. According to Section 4 of the Companies Act 2016, there are three types of companies that can be incorporated in Malaysia. They are private companies limited by shares, private companies limited by guarantee and subsidiaries of foreign companies.
A private company limited by shares, also known as a limited liability company the most common type of company registered in Malaysia. This article will focus on how to incorporate this type of company.
Requirements to incorporate a Private Limited Company in Malaysia ("Sdn. Bhd.")
Here are the minimum requirements to incorporate a Private Limited Company in Malaysia, officially known as "Sendirian Berhad" (Sdn. Bhd.):
1. Company name
The proposed company’s name must contain standard English or Bahasa Malaysia words. Otherwise, you will need to prepare an explanation of the meaning of the non-standard words. The proposed company name must also comply with the guidelines for naming a company set by the Companies Commission of Malaysia ("CCM" or "SSM" in Bahasa Malaysia).
The following criteria for directorship apply to all companies wishing to register under the Companies Act 2016:
- At least one (1) natural person must be appointed as a director of the company;
- At least one (1) of the company's directors must ordinarily reside in Malaysia and have a principal place of residence in Malaysia
- Must be 18 years of age or more;
- Must not be disqualified under any written law from being a director of a company;
- A person is not disqualified from being a director by any written laws in effect:
The following criteria for shareholders apply to all companies wishing to register under the Companies Act 2016:
- At least one (1) shareholder is required to form the company
- A shareholder can be a person or a company (corporate shareholder). In the case of a corporate shareholder, an authorised representative must be appointed.
4. Paid-up Capital
The minimum paid-up capital to form a company is RM 1.00.
5. Registered Address
The registered address must be located within Malaysia.
6. Documents Required
Stakeholders (i.e. directors, individual shareholders, and the authorised representative of a corporate shareholder):
- NRIC (for Malaysians) or valid passport (for foreigners);
- Proof of address or residency (for foreigners & Malaysians who ordinarily reside overseas);
- Letter or resolution of appointment of authorised representative (if applicable).
- Official company profile from the Companies Registrar (for corporate shareholders).
- Letter of authorisation if your company's proposed name contains words or names from another company (eg: parent company or related companies).
- Letter of authorisation from the relevant authorities if your company's proposed name contains controlled words (eg. "bank", "hospital", "accounting", "tax", etc).
How much does the incorporation cost?
Below is the breakdown of the Sdn Bhd registration cost that you should be expecting to pay to incorporate your Private Limited company in Malaysia:
- Company name reservation: RM 50 per reservation
- SSM Malaysia company incorporation fee: RM 1,010
- Professional fees charged by Company Secretary firm to register Sdn Bhd company: Varies
Procedures for incorporating a Private Limited Company in Malaysia ("Sdn. Bhd.")
Once you have prepared all the required documents and information, you can now proceed to incorporate your company.
This process of incorporation is relatively straightforward. The following steps cover the process of incorporating a Private Limited Company ("Sdn. Bhd.") company with the help of a Company Secretary:
1. Provide all required information & documents to your Company Secretary
Your Company Secretary should be able to advise you of the list of required information & documents. It normally includes the proposed company name, nature of business, particulars of directors & shareholders, each stakeholder's ID document, shareholding structure, etc.
2. Company name search and reservation
Your Company Secretary will perform a name search exercise on the proposed company name by searching it through SSM's database. This is to ensure that the intended company name is available and has not been taken up by another existing company.
From there, the proposed company name is submitted to SSM for final approval. The approval process normally takes 1-2 business days. Once approved, the company name can be reserved for 30 days (extendable to 180 days subject to approval by the Registrar).
3. KYC and background checks
While waiting for the proposed company name to be approved, your Company Secretary will perform various mandatory checks. These checks include KYC, bankruptcy, and background checks on each of the stakeholders of the proposed company.
4. Signing declarations & documents
At the same time, your Company Secretary will prepare the necessary declarations and documents for all the stakeholders' signing.
5. Application and document submission to SSM
Once everything is in order, your Company Secretary will submit the application with the supporting documents to SSM for its approval. The approval process normally takes 2-3 business days.
6. Approval and next steps
Once the application is approved, the Certificate of Incorporation for your company will be issued by SSM. Congratulations, your company is now successfully incorporated!
From this point onwards, you have 30 days to officially appoint your Company Secretary. Your Company Secretary will prepare the paperworks for you to officially appoint them as your Company Secretary on record.
Incorporate your company with Centry
Incorporating your company with Centry has never been easier.
Our online incorporation platform is 100% automated. It is designed for you to incorporate your dream company at comfort of your own house, at your own pace.
Here's how to incorporate your company with Centry in 4 easy steps:
Step 1: Fill in company incorporation form
Head over to the company incorporation dashboard to get started. Click on "Start Incorporating" and fill in the company incorporation form
Step 2: Complete payment
Complete the payment of RM 1,949 comprising of:
- RM 1,499 (inclusive of the RM 50 company name reservation fee and RM 1,010 SSM company incorporation fee)
- RM 450 for our Company Secretarial retainer fee (RM150/month billed quarterly)
Step 3: e-KYC
All stakeholders will receive a unique link to proceed with the e-KYC process as mandated by Bank Negara Malaysia. The e-KYC process comprises 2 parts:
- Part 1: Filling in personal information and background information
- Part 2: Completing an automated 3-step identity verification process
Step 4: Sign declarations
Once the e-KYC is completed, you will receive an email notification asking you to e-sign the Letter of Incorporation and S201 Declaration.
Step 5: Sit back and relax
That's it! Now sit back and relax while we take over from there to incorporate your company.