MalaysiaTypes of Business License in Malaysia and How to Obtain?

• Securing a business license in Malaysia is a vital step for starting a new company or business. These licenses are administered by various government agencies, statutory bodies, and local authorities. Once your company is set up in Malaysia, you must obtain the necessary licenses, which fall into three main categories: general licenses, sector-specific licenses, and activity-specific licenses. The specific licenses you need depend on your industry.  
• Licensing ensures you can legally operate your business and access the benefits offered by the Malaysian market. Both foreign and local investors need to obtain authorized licenses to conduct business in Malaysia. Thoroughly understanding the different types of business licenses and the application process is essential for a smooth journey when you register company in Malaysia. This compliance supports the sustainable growth and success of your business in the country. 

Documents to prepare before applying for business license in Malaysia 

• A copy of your identity card/passport. 
• A passport sized photograph. 
• A copy of your rental/tenancy agreement or sale and purchase agreement. 
• Photographs of your business premise. 
• Photographs of the intended location for your company’s signboard (applicable to the Signboard License). You will also need to provide samples indicating the colour and the design of your intended signboard. 
• Copy of your Certificate of Fitness for the business premise. 
• Copy of Fire Department’s support letter. 

Governing bodies for business license in Malaysia 

• In Malaysia, various councils and government bodies, such as the Malaysia Company Commission, local town councils (e.g., DBKL, MPAJ), and Fire Brigade Departments, are responsible for issuing licenses to business firms, industries, food factories, retail stores, restaurants, and more across the country. Inspectors from relevant ministries may visit companies to evaluate their operations, services, and business nature before issuing a license.  
• Foreign investors should carefully research the specific licenses needed for their intended business activities in Malaysia to avoid costly mistakes or legal issues. Understanding the type of license and business requirements can lead to a smooth licensing process. 
• Tetra Consultants can assist clients in acquiring business licenses in Malaysia, ensuring compliance and guiding them through the application process for various types of licenses.  
• Additionally, paid-up capital requirements vary depending on the business license, ranging from RM 50,000 to RM 1 million. Companies under Labuan Company, which do not require industry licensing, can start with a paid-up capital of just 1 USD. 

Types of business license in Malaysia 

General license 

• General licenses are essential permits necessary to start a business in Malaysia. They are mandatory for launching any business in the country. The key general licenses required include: 
• Company registration: Officially register the business with the relevant authorities. 
• Company and employees income tax registration: Register the business and its employees for tax purposes. 
• Employees Provident Fund (EPF): Register employees for the EPF, Malaysia’s retirement savings plan. 
• Social security organization (PERKESO): Register employees with PERKESO for social security and insurance benefits. 
• Human Resource Development Fund (HRDF): Depending on the industry, registration with HRDF may be necessary to support employee training and development. 
• Business premise licenses and signboard licenses: Obtain these from local state authorities for permission to operate in a specific location and display business signs. 
• The requirements for business premise and signboard licenses can vary across different states, so it is essential to check the specific regulations for the location where the business will operate. 

Sector industry specific license 

• These licenses are necessary for specific sectors or industries in Malaysia and are determined by the government based on business activities. The licenses in this category include: 
• Manufacturing sector licenses 
• Distributive trade licenses 
• Telecommunication sector licenses 
• Broadcasting sector licenses 
• Oil exploration sector licenses 
• Construction sector licenses 
• Banking sector licenses 
• Licenses under department BLESS, Ministry of Entrepreneur Development (MED) 
• License under the Department of Occupational Safety and Health Malaysia (DOSH) 
• License under the National Water Services Commission (SPAN) 
• These industry-specific licenses are essential for companies to legally operate in their respective sectors in Malaysia. Each business sector has its own set of regulations and requirements, so it is important to be aware of the necessary permits for the specific industry in which you are engaged. 

Activity specific license 

• In Malaysia, specific business activities require particular licenses that must be obtained before commencing operations. These licenses are related to the nature of your business and are governed by strict guidelines designed to protect the interests of Malaysian citizens, workers’ safety, the environment, and public welfare. Some examples of these activity-specific licenses include: 
• Certificate of fitness and certified machinery 
• Approval of expatriate posts 
• Approval to install air pollution control equipment 
• Building plan approval 
• Sales tax license 
• Acquiring these licenses ensures compliance with regulations and promotes responsible business practices in various industries across Malaysia. 

How to obtain business license in Malaysia? 

Step 1: Determine the nature of the licenses required 

• Tetra Consultants will begin by conducting comprehensive business research following your business registration in Malaysia. This involves analyzing the necessary requirements and identifying the specific licenses needed to operate in Malaysia. Key considerations during this process include: 
• The timing of business registration; 
• The business activities for which the entity has been registered in Malaysia; 
• The ownership status of the business; 
• The geographical scope of the business registered in Malaysia; 
• The branches of the business (if any), etc. 
• Our expert team will assess these factors to ensure smooth business operations and compliance with local regulations. 

Step 2: Gather relevant documents 

• As the next step, Tetra Consultants will gather all necessary information and documents to facilitate obtaining the required business license in Malaysia. The specific documents will vary depending on the type and requirements of the business license.  
• Our team will guide you through this process to ensure all relevant documentation is prepared efficiently and accurately through legal drafting services, setting you up for a smooth licensing journey. Some of the common documents include: 
• The facsimile of the business registration certificate; 
• The facsimile of the financial statement of the business; 
• The facsimile containing the site plans; 
• A copy of the partnership agreement (if any); 
• A facsimile of certain grants, titles, rent or lease agreements; 
• The photo ID of the applicant; 
• The facsimile of construction certificate of occupation; 
• The complete facsimile of the SSM documents; 
• Photographs of the applicant; 
• Photographs of the business premise, the company’s signboard, etc.; 
• The facsimile of the Fire Department Support Letter; 
• A copy of the office layout plan; 
• A facsimile of the certificate of fitness for the business premises; 
• The list of products with relevant prices, etc. 

Step 3: Prepare and complete the application 

• Further, Tetra Consultants will assist you in downloading and completing the application form based on the research conducted to obtain the necessary business license in Malaysia. We will guide you through recording relevant information about your business’s nature and operations on the form and help you compile supportive documents for a seamless application process. 

Step 4: Make necessary payments 

• Making the necessary payments to secure a business license in Malaysia is a vital step for every business filing an application. Before submitting the application, Tetra Consultants will assist you to pay the required government fees for the business license. These fees need to be settled in advance, and payment is accepted only under specific circumstances including: 
• If the payment is made in cash, 
• If the payment of fees is made through money order, 
• If the mode of payment is through remittances, 
• A bank draft is used to make payments of the prescribed fees; 
• If the payment is accompanied by a credit card, 
• If the payment is a government fee, it is directly made payable to the bank’s counter. 

Step 5: File and submit the application 

• After paying the fees, our experts will guide you through the submission process of your license application to the relevant local authorities in Malaysia, such as the town or local council. This includes providing a copy of an Assessment Receipt of the business.  
• Further, the application will be submitted to Dewan Bandaraya Kuala Lumpur (DBKL). Once submitted, you will need to wait for the Malaysian government to process your application, which may vary depending on the type of business license requested. 

Step 6: Obtain a certificate of approval or license 

• Tetra Consultants will further assist you in obtaining the approved business license in Malaysia, where the Malaysian government issues a certificate or professional license valid for at least one year. This license allows you to operate your business while adhering to the stipulated conditions.  
• However, our support doesn’t stop here. We will continue to help you navigate the process of renewing your business license as required, ensuring your legal entity remains compliant with all regulations over time. 

Conclusion 

• At Tetra Consultants, we understand that obtaining business licenses in Malaysia is crucial for seamless operations and legal compliance. Our team offers comprehensive support in navigating the diverse licensing requirements for various industries.  
• Beyond business licenses, we provide a range of services including offshore financial licenses, offshore company incorporation, corporate bank account opening, accounting and tax obligations, legal drafting of necessary documents, and much more. Trust our experts to guide you through every step of your business journey, ensuring a smooth and efficient process from start to finish. 
• Contact us to know more about business license in Malaysia and our team will revert back in 24 hours.