GUIDE TO DOING BUSINESS IN MALAYSIA September 2017 Private & Confidential Ministries, Regulatory Bodies and Agencies Acronym Name Website BNM Bank Negara Malaysia/Central Bank of http://www.bnm.gov.my/ Malaysia Bursa Malaysia Bursa Malaysia Berhad http://www.bursamalaysia.com/market/ CCM/SSM Companies Commission of http://www.ssm.com.my/ Malaysia/Suruhanjaya Syarikat Malaysia Customs Royal Malaysian Customs http://www.customs.gov.my/ DOE Department of Environment http://www.doe.gov.my/portalv1/en ECERDC East Coast Economic Region http://www.ecerdc.com.my/ Development Council EPU Economic Planning Unit http://www.moha.gov.my/index.php/en/ FELCRA Federal Land Consolidation and http://www.felcra.com.my/ Rehabilitation Authority FELDA Federal Land Development Authority http://www.felda.net.my/ Immigration Immigration Department http://www.imi.gov.my/index.php/ms/ IRB Inland Revenue Board http://www.hasil.gov.my/ IRDA Iskandar Regional Development Authority http://www.irda.com.my KKMM Ministry of Communication and Multimedia http://www.kkmm.gov.my/ Malaysia/Kementerian Komunikasi dan Multimedia Malaysia KLRCA Kuala Lumpur Regional Centre for http://klrca.org/ Arbitration KPKK Ministry of Information, Communication http://www.penerangan.gov.my/ and Culture/ Kementerian Penerangan, Komunikasi dan Kebudayaan Labuan FSA Labuan Financial Services Authority http://www.lfsa.gov.my/ MAMPU Malaysian Administrative Modernisation http://www.mampu.gov.my/web/en/ma and Management Planning Unit mpu © Christopher & Lee Ong 2 Acronym Name Website MCMC Malaysian Communications and http://www.skmm.gov.my/ Multimedia Commission MDeC Multimedia Development Corporation http://www.mdec.my/ MDTCC Ministry of Domestic Trade, Co-operative http://www.kpdnkk.gov.my/ and Consumerism MHA/LLM Ministry of Highway Authority/Lembaga http://www.llm.gov.my/background_EN Lebuhraya Malaysia .aspx MIDA Malaysian Investment Development http://www.mida.gov.my/ Authority MITI Ministry of International Trade and Industry http://www.miti.gov.my/cms/index.jsp MOF Ministry of Finance http://www.treasury.gov.my/index.php? lang=ms MOHA Ministry of Home Affairs http://www.moha.gov.my/index.php/en/ MOHE Ministry of Higher Education http://jpt.mohe.gov.my/eng/ MONRE Ministry of Natural Resources and http://www.nre.gov.my/ Environment MOSTI Ministry of Science, Technology and http://www.mosti.gov.my/ Innovation MOW Ministry of Works/Kementerian Kerja Raya http://www.kkr.gov.my/ MyIPO Intellectual Property Corporation of http://www.myipo.gov.my/ Malaysia NCIA Northern Corridor Implementation http://www.koridorutara.com.my Authority PSD Public Service Department http://www.jpa.gov.my/?lang=en PWD/JKR Public Works Department/Jabatan Kerja http://www.jkr.gov.my/ Raya RECODA Regional Corridor Development Authority http://www.recoda.com.my RMP Royal Malaysia Police http://www.rmp.gov.my/ SC Securities Commission http://www.sc.com.my/ SEDA Sustainable Energy Development http://www.seda.gov.my Authority SEDIA Sabah Economic Development and http://www.sedia.com.my Investment Authority SPAD Land Public Transport http://www.spad.gov.my/ Commission/Suruhanjaya Pengangkutan Awam Darat UKAS Public Private Partnership Unit/Unit http://www.ukas.gov.my/ Kerjasama Awam Swasta © Christopher & Lee Ong 3 Contents 1. Introduction ........................................................................................................................................ 5 2. Legal Background and Judicial System ............................................................................................ 8 3. Establishing a Presence .................................................................................................................. 14 4. Foreign Investment and Local Equity Participation Requirements ................................................. 23 5. Investment Incentives ...................................................................................................................... 29 6. Taxation ........................................................................................................................................... 36 7. Banking & Finance .......................................................................................................................... 44 8. Foreign Exchange Administration ................................................................................................... 57 9. Capital Markets ................................................................................................................................ 64 10. Employment Law ........................................................................................................................... 72 11. Foreign Investment in Real Property ............................................................................................. 78 12. Franchise Law ............................................................................................................................... 83 13. Environmental Laws ...................................................................................................................... 88 14. Intellectual Property ....................................................................................................................... 93 15. Infrastructure ................................................................................................................................. 98 16. Telecommunications, Media and Technology ............................................................................. 138 17. Multimedia Super Corridor........................................................................................................... 143 18. Labuan – International Business and Financial Centre............................................................... 150 19. Economic Corridors ..................................................................................................................... 155 20. Competition Law .......................................................................................................................... 163 21. Private Healthcare ....................................................................................................................... 169 22. Private Higher Education Institutions .......................................................................................... 175 23. Insurance ..................................................................................................................................... 180 24. Personal Data Protection............................................................................................................. 186 25. Acknowledgements ..................................................................................................................... 190 Regional Contacts ............................................................................................................................. 191 This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice or legal opinion. The information contained in this publication should not form the basis of any decision as to a particular course of action. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Christopher & Lee Ong, its partners, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. The law is correctly stated as at 15 September 2017, and some of the publicly available information are obtained from various resources including the official websites of the relevant government departments and agencies. You are therefore advised to engage the services of a competent professional adviser (including but not limited to legal, tax and business consultants) so that the applicability of the relevant legislation or other legal development to the particular facts can be verified. © Christopher & Lee Ong 4 Introduction Geography 1. Introduction With its land area totalling 329,847 sq. km, Malaysia consists of Peninsular Malaysia and East Malaysia (the states of Sabah and Sarawak) which are separated by the South China Sea. Peninsular Malaysia shares its border with Thailand and sits north of Singapore while East Malaysia is located on Malaysia is strategically located in the heart the island of Borneo and shares its border with of South East Asia and offers investors a Brunei and the Indonesian territory of Kalimantan. dynamic and vibrant business environment The country enjoys a tropical climate with hot and with ideal prerequisites for growth and humid weather all year round. Annual southwest and profits. Malaysia is a federal constitutional northeast monsoons also occur from April to September and November to February respectively. monarchy comprising of thirteen states and three federal territories in both Peninsular Demographics Malaysia and East Malaysia. Kuala Lumpur Malaysia has a population of approximately 29.5 is the Federal Capital of Malaysia whereas million consisting of different ethnic groups with the Putrajaya is the administrative capital dominant racial group