INVEST

Invest in Malaysia

Malaysia’s strategic location in Southeast Asia, competitive costs, and business-friendly government policies make it an attractive hub for foreign entrepreneurs. 

Reasons to Invest in Malaysia

Investing in Malaysia offers several advantages for foreign and local investors alike. 

Here are some of the top reasons to consider investing in Malaysia:

1. Strategic location and access to ASEAN market

2. Pro-investment policies and regulatory framework

3. Attractive tax incentives for promoted activities

4. Developed infrastructure and industrial hubs

5. Skilled and multilingual workforce

6. Thriving digital economy and technology sector

7. Access to trade agreements and market integration

8. High quality of life and cultural diversity

9. One-stop support from MIDA

If you consider running or investing your business in Malaysia, understanding the cost of doing business is critical. Learn the details of the general cost and expenses here:

By carefully planning and leveraging government incentives, you can manage costs effectively and maximize your business potential in Malaysia.

MIDA Role

Investing in Malaysia as a foreign national is encouraged by the government, and there are various incentives and opportunities available through the Malaysian Investment Development Authority (MIDA).

MIDA: Overview and Role

The Malaysian Investment Development Authority (MIDA) is the government agency under the Ministry of International Trade and Industry (MITI) responsible for promoting and coordinating investment in Malaysia.

MIDA helps both local and foreign investors by facilitating the entry of foreign capital into various sectors, providing information, and guiding them through the investment process.

Types of Investments

Foreign nationals can invest in a wide range of sectors in Malaysia. However, certain industries may have restrictions or require specific approvals. The following are key areas in which foreign nationals can invest:

1. Manufacturing Sector

The manufacturing sector in Malaysia is one of the most attractive areas for foreign investment. Foreign companies are encouraged to establish manufacturing plants or joint ventures with local companies. 

Key industries include:

• Building technology
• Electronics and electrical products
• Automotive & Aerospace
• Chemical and advanced materials
• Food and beverages
• Life science and pharmaceuticals
• Machinery & Metal

2. Services Sector

The services sector is another area of focus, with significant opportunities in sectors like:

• Business services
• Oil and gas 
• Healthcare and medical services
• Tourism and hospitality
• Education
• Logistics
• Green technologies

Investment Incentives

MIDA offers various incentives to attract foreign investors. Some of the key incentives include:

1. Tax Incentives

• Pioneer Status (PS)

Provides tax exemption up to 70% to qualifying companies

• Investment Tax Allowance (ITA)

Investment tax allowance up to 60% of qualifying capital expenditure for investments in new projects or expansions of existing businesses

• Tax Incentives for High-Tech Industries

Industries involved in high technology, innovation, and R&D may qualify for additional tax relief and exemptions

2. Grants

MIDA provides grants to foreign companies investing in Malaysia, particularly in areas related to technology, R&D, and green initiatives. 

Application to InvestMalaysia

Invest Malaysia is Malaysia’s premier platform for promoting investment opportunities in the country under MIDA. It serves as a gateway for both local and international investors to explore and capitalize on Malaysia’s dynamic economic landscape.

Application to InvestMalaysia involves 3 steps:

Procedures:

1. Business registration

Set up your business by following this guide:

2. Submission to Invest Malaysia portal

Prepare your submission to Invest Malaysia portal

3. Approval for Manufacturing License

4. Approval for Incentive Application 

After the proposal is reviewed, MIDA will grant approval and outline any applicable tax incentives or other financial support available to the investor.

Manufacturing & selected service sector is under MIDA purview.

5. Post-Approval Support

MIDA offers continuous support for investors after project approval, including assistance with funding, land, or facilities, as well as guidance on local regulations.

6. Post-Investment & Infrastructure Support

MIDA provides support to investors after their investments are made to ensure smooth operations and enhance the competitiveness of businesses in Malaysia.

Setting Up Business

Establishing a business in Malaysia as a non-citizen involves adhering to the guidelines set by the Companies Commission of Malaysia (Suruhanjaya Syarikat Malaysia, SSM). 

Foreign entrepreneurs can choose between incorporating a local company,  registering a foreign company (branch office), or limited liability partnership (LLP). 

Below is a guide to assist you through the process:

1. Incorporating a Local Company (Private Limited Company - Sdn. Bhd.)

• Eligibility

A minimum of one director who ordinarily resides in Malaysia is required.

The director must have a principal place of residence in Malaysia.

• Steps to Incorporate

Follow the steps in the link below under registration of company:

2. Registering a Foreign Company (Branch Office)

• Definition

A foreign company refers to a corporation incorporated outside Malaysia that establishes a place of business or carries on business within Malaysia.

• Registration Process

Follow the steps in the link below under registration of company:

3. Registering a limited liability partnership (LLP)

A Limited Liability Partnership (LLP) in Malaysia is a business structure that combines the limited liability features of a company with the operational flexibility of a partnership. 

It is a separate legal entity from its partners, offering perpetual succession and the ability to own property, enter contracts, and sue or be sued in its own name.

• Registration Process

Follow the steps in the link below under registration of company:

Additional Considerations

MTEP Program

If you are a tech entrepreneur looking to set up a start-up tech business in Malaysia, you can check the details here;