Formal registration of companies has many immediate benefits for the companies and for business owners and employees. Legal entities can outlive their founders. Resources are pooled as several shareholders join forces to start a company. Formally registered companies have access to services and institutions from courts to banks as well as to new markets. And their employees can benefit from protections provided by the law. An additional benefit comes with limited liability companies. These limit the financial liability of company owners to their investments, so personal assets of the owners are not put at risk. Where governments make registration easy, more entrepreneurs start businesses in the formal sector, creating more good jobs and generating more revenue for the government.
Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Malaysia. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.
This information was collected from World Bank: Doing Business
|No.||Procedure||Time to Complete||Associated Costs|
|1||Application to the Companies Commission of Malaysia (CCM) on the prescribed form (13A) to ensure the availability of the proposed company's name|
Name search can be conducted online and payment can be made online
|1 day||MYR 30 per name search application|
|2||Company Secretary prepares company incorporation documents|
A company secretary is required to prepare the incorporation documents and provide a statutory declaration of compliance (Companies Act 1965).
|3 days||MYR 1000|
|3||File necessary documents with the Companies Commission of Malaysia (CCM) one-stop shop and obtain company incorporation, tax registration, registration with the Employment Provident Fund (EPF), Social Security Organization and the Inland Revenue Board, a|
Comment: Promoters must pay the registration fee and file the following incorporation documents with the Companies Commission within 3 months of name reservation:
• The memorandum and articles of association and the statutory declaration of compliance (Form 48A) (prepared by a lawyer or the company secretary).
• The particulars of (a) two subscribers holding a minimum of one share of MYR 1 each and (b) At least two directors who have their principal or sole place of residence in Malaysia.
• The original Form 13A and a copy of the letter from the CCM approving the name of the company have to be attached as well.
• The address or location of the registered office.
After the submission of the incorporation papers, the CCM issues Form 9 (certificate of incorporation) upon lodgement of the relevant documents.
The registration fee for the authorized share capital is charged the following scale and is payable to the Companies Commission: Registration fee schedule based on nominal share capital:
• MYR 0 - 100,000: MYR 1,000.00
• MYR 100,001 - MYR500,000: MYR 3,000.00
• MYR 500,001 - MYR 1 million: MYR 5,000.00
• MYR 1 million - MYR 5 million: MYR 8,000.00
• MYR 5 million - MYR 10 million: MYR 10,000.00
• MYR 10 million - MYR 25 million: MYR 20,000.00
• MYR 25 million - MYR 50 million: MYR 40,000.00
• MYR50 million - MYR 100 million: MYR 50,000.00
• Over MYR 100 million: MYR 70,000.00
|1-2 days||MYR 3,000 (registration fee)+ MYR 220 (stamp) + MYR 100 (post-incorporation package)|