How to Start a Business in Malaysia in 15 Simple steps

How to Start a Business in Malaysia in 15 Simple steps

How to start a business in Malaysia is the question in town. Malaysia is a land of opportunities for a sensible entrepreneur. The entire Asian business community considers the Malaysian business circle a trade magnet where good ideas thrive quickly.

Whether you are a foreigner or local, becoming an entrepreneur in Malaysia is a dream coming true.

But most individuals will also say that Malaysian business ownership has become a bit of a myth. So here is a detailed overview of starting a business in Malaysia. We have discussed every misconception that we have come across.

You will find out which ones are myths and which ones are real. You will also gain useful links for all licensing, registration, approval and business research requirements that you may have to fulfill.

So here are 15 simple steps that you will need to follow in order to start a business in Malaysia:

Step 1- Business Plan:

Have a business plan ready and try to stay as on point as possible at the time of execution.

It should be an obvious point but still worthy of being stated. Do extensive research in the Malaysian market and understand the basic culture of the land before you decide to invest.

Step 2- Product Research:

Our advice is to hire a good research agency like Euromonitor to conduct the research for you. The data is the key to understanding how you will invest in your product.

Product research is the most significant part of the business plan. Make sure that you conduct extensive research into the product or services that you plan to launch. Do not just take up a sample of 500 random respondents to a survey.

If you start your business without proper and concrete market research, you may lose your money in many ways that could have been avoided.

Step 3- Opening a bank account:

As business is being launched, you will need a bank account to handle your financial transactions. You cannot use your personal account because the company requires a corporate account.

If you are a foreigner then you will need to have a strong investment. Without a strong investment, banks do not allow foreigners to open bank accounts.

If you are a local individual then you simply need to open a corporate bank account that will allow you to open a corporate account. This account will be needed to manage a large number of transactions for the business.

Step 4- How to start a business with High Remittance Fees:

The remittance fees for opening a Limited Liability Company (LLC) or Private Limited Company (PVT) is famously said to be RM 500,000. That is a gross misrepresentation of the facts. The RM 500,000 is simply a myth and nothing more.

The remittance fee, if you are a foreigner, is RM 5000 and much less if you are local. The RM 500,000 is simply a myth and nothing more.

We advise you to research the topic of remittance here at Advisorybiz. This is a well- respected and trusted site that will guide you on the matter very well. Remittance fees in Malaysia are reasonable and can be easily afforded by any serious investor.

Step 5- Appointing a local director

There is a myth that the company needs to hire a local Malaysian national to be the director of the company. That myth is not true; foreigners can be the company directors and file the paperwork as foreigners.

The myth that the business owner needs to be a permanent resident of Malaysia is also not accurate as a complete foreigner can also own business in the country. You simply need to register your business with the government.

Step 6- Minimum Capital Requirement:

The most common question is what the minimum capital requirement set by the government is if you want to launch a business in Malaysia.

The answer is that there is no minimum capital requirement for small businesses. You can show any capital that you have if it is compatible with your business plan and product than you will easily gain an LLC license.

If you are launching a major industry or a serious business like fisheries, manufacturing or factory based production, and then you need to show RM 500,000 to the government.

This is where the number comes in. To know more about the capital requirement of SME’s check out The STar’s discussion on SME’s in Malaysia!

Step 7- Government Regulation:

Like any other businesses, the regulations of the country have to be taken into account for your business as well.

There are unique regulations for every kind of business but any business that requires import or export as a part of your business plan will need licensing. There is an extensive licensing protocol for import and export business.

The importer export licensing is a long process and every product will have to be approved by a specific ministry.

There is no one office that issues licenses for all imports and exports. More information for import/export license can be found at Bizfluent, the known business website of Malaysia.

Step 8- Common Business Options in Malaysia:

If you want to start a business but do not know which business options are the best then here are a few good ones for you.

Restaurant ownership: Restaurant ownership is considered a great business because restaurants are the most successful enterprise in the country.

Import/Export Business: The import/export industry in Malaysia is very strong so if you can import or export a product in the country then that is a lucrative option.

These businesses are the most commonly opted for a person is allowed to launch a product or offer any services that you feel are better ventures.

Step 9- Licensing Process:

Licensing Process in Malaysia is complex and will require a great understanding of the system. There are three licenses that are available for businesses;

Company License: This will be a license issued by the industry that your company belongs with and will be issued by the relevant Ministry in Malaysia.

Business License: This is the basic license that we have explained earlier.

Activity License: The activity licenses include service/goods tax, building plan approval license, fire brigade approval license, expatriate work permit license and similar licenses that you need in order to run your business.

It should be noted that there are eight other forms of licenses that will be needed. More on licensing at Malaysia Biz Advisory’s website.

Step 10- Launching your business and Product:

Now that you have gained all of these necessary permits and have done your research; it is time to launch your business. By this time, you should have understood the market in a great and detailed manner.

Your product research that was the second step of the plan will help you launch the business in the correct direction. Remember, that focusing your business on the right target market is the difference between a successful and doomed venture.

Step 11- Company registration:

Company registration is a long process as was shown by the licensing process. We made a separate point so that we could elaborate more.

You will require all of the licenses and will need to show all of the paperwork that has been completed.

The process will only continue successfully if you have conducted all of your approvals and company registration is the last step.

Otherwise, it is common in Malaysia for the company registration process to go awry. Company registration applications are commonly rejected unless you have done all of your paperwork and your company is ready to be registered. Here are the steps for company registration in Malaysia y S & F Consulting Firm, renown consulting on legal issues.

Step 12- Doing Business in Malaysia:

There is a common belief that doing business in Malaysia is a tough and arduous task because of the fees.

Truth is, many local, as well as foreigners, have achieved the aim of successful business ownership in Malaysia. There are regulations so that only serious investors will consider doing business in the area.

But if the regulations are seriously followed, then all of the approvals and licenses can be easily gained and the return on investment will certainly make up for the investment itself.

Step 13- How to start a business in the Local Competition:

There is a belief in the local population that the competition in Malaysia is too high for new investment. The truth is that this is a gross misconception.

The competition is high in Johor Bahru, Kuala Lumpur, Penang and Selangor that are considered in Peninsula states of Malaysia.

Eastern Malaysia has much less attention from investors and is open to new products and services. If a person launched their business in these regions then they are going to find themselves as one of the few suppliers of their product.

This is the attitude we were discussing in product research. Make sure that you conduct a good research on where your product or services are in high demand and low supply so that you can take your product there.

Once your product is launched in a less competitive market, it will gain profit quickly and you will be successful without much competition.

Step 14- Promoting Your Business:

Conventional promotion methods are not the best idea for a new business. Commercial advertisement is expensive and most of the commercial advertising is not giving the right results.

We would suggest that you include marketing research in your product research.

Gain a good digital marketing team and launch a digital marketing campaign for your product so that it gains the right attention from the audience as that is a serious issue.

Make sure that you focus your marketing budget where it will gain the highest attention from consumers. In the modern world, the Malaysian population is not watching TV commercials and newspapers are a dying breed.

A better solution is to use the money to reach out to consumers on social media and other digital forums so that the consumers will gain the right attention.

Step 15- Making your business successful

Now comes the part that no one can guide you through. You have to work day in and day out and make sure that your investment comes through.

Our advice: make sure that you truly understand your business before you launch one. A good way to do that is to get a job in the field or get an internship as that will put you in the center of the market.

No school can teach you what a regular experience in the real market will be able to teach you.

This will save you the risk of losing your business because you did not truly understand the market. This is not case-specific advice but universal wisdom that is followed all around the world.

After investing a considerable amount of money into a business, it is only wise to understand the local market before launching the business.

This is our fifteen step guide on how to start your business in Malaysia.

How to Start a Business in Qatar Full guidelines here.

How to Start a Business in Qatar? Full guidelines here.

Starting a business in Qatar will be a profitable venture provided that you understand the Qatari business environment, have a solid business plan to succeed in the country while leveraging the benefits offered by the government for foreign investors.

Qatar’s economy in 2019 is experiencing steady growth despite the continuing economic blockade, as the country is moving towards the path of self-sufficiency and economic development under the leadership of His Highness Sheikh Tamim bin Hamad Al Thani. The state is consistent in improving its infrastructure making life easier for industries, companies and encourages foreign direct investment into the country through a set of laws that allows non-Qatari citizens to invest, own or register a business in Qatar.

To encourage foreign direct investment in the country, the government has revised the rules & regulations set by Law No 12 of 2000, by issuing Law Number 1 of 2010 on the 1st of Feb 2010 authorising the non-Qatari investment into the country and allowing 100 percent foreign ownership for businesses operating in Qatar. The foreign investment in Qatar and complete business ownership by non-Qataris was permitted to new industries including Information Technology (IT), consultancy services, services associated with entertainment, sports, culture, and distribution.

In addition to this, the Commercial Companies law that came into effect since 2015 has eased out restrictions and permitted hundred percent foreign ownership in Qatar for the first time in major business sectors including agriculture, manufacturing, health, education and tourism. More importantly, the business opportunities in Qatar for foreign companies are expanding further as the state is diversifying the economy and the rules are made business-friendly along with lower taxes rates. The law supports the business operations in the country by providing them with various incentives and gives investors the freedom to repatriate all the capital profits gained from their Qatar business to their country of origin without any taxes.

If you want to know more information about starting a business in Qatar contact us our Qatar team would be happy to help you with any information. Our BSW team is expert with the Qatari laws, procedures, and legislation for incorporating your business in Qatar and assist you in running a successful company.

Advantages of Starting your business in Qatar

  • Open trade policy which facilitates international trade
  • Zero percent tax on exports
  • No income tax or social security deductions payable on wages and salaries
  • State-of-the-art modern telecommunications infrastructure
  • Excellent and well-connected transport system
  • High quality, modern offices, and luxurious residential accommodations
  • Inexpensive workforce, a relatively straightforward procedure for recruitment
  • Qatar has Luxury hotels, hospitals, schools, shopping malls, and many more facilities
  • Lowest corporate tax on foreign companies 10 percent (as of 1 Jan 2010)
  • Foreign investors are permitted full repatriation of capital and profits overseas in foreign currency
  • Access to double taxation treaties with Algeria, Bangladesh, Belgium, Cyprus, France, India, Italy, Luxembourg, Macedonia, Malta, Morocco, Pakistan, Poland, Romania, Russia, Senegal, Seychelles, Singapore, South Korea, Sri Lanka, Tunisia Turkey, and Venezuela

Things to Consider the Business Environment in Qatar

Know the Country

Qatar was formed from a loose association of tribal groupsprimarily engaged in pearl harvesting and fishing. This came to an end in the 1930s when thepearl market collapsed. In 1935, the establishment of Qatar General Petroleum Corporation took place, signalling the end to one phase of Qatar’s history and thebeginning of the next.

Currently, the State of Qatar is headed by the Emir His Highness Sheikh Tamim bin Hamad Al Thani with Abdullah bin Nasser bin Khalifa Al Thani as the Prime Minister, Arabic is the official language besides English is widely used and preferred within business circles.The state has excellent infrastructure, robust financial sector and effective government policies to protect and guide the citizens, residents and businesses of Qatar to success even in hard times.

Business Culture

Dealing with Qatari people in business one can expect a strong focus on the Arabic business etiquette even though most of the people working in Qatar are expatriates they are accustomed to the region’s culture and customs.

  • Business meetings in Qatar are conducted elaborately in a slower pace involving several frequent visits and meetings which are patiently carried out to understand the client, build trust and reciprocity
  • Most business negotiations are carried out in English, while the paperwork and documentation is primarily done in Arabic with English translations provided wherever needed
  • The Qatari people place great importance on getting to know their business contacts personally and make an effort to develop a relationship with them. As the business and personal lives are closely intertwined in the Arabic culture.
  • Networking and facetime outside business hours (i.e., an invitation to lunch or dinner) are given significant importance as hospitality is very important in Qatar
  • Importantly, it is essential to remain courteous and patient at all times during business meetings to maintain a respectful relationship with the opposite party. Itshall prove to be useful in future handlings and improves your reputation, which is essential in a small country like Qatar
  • Avoid aggressive behaviour, make sure you are mindful while promising what you can deliver as your verbal commitment in the conversation are regarded in equal importance toa written contract

Foreign Relations

The state of Qatar follows an independent international policy and enjoys diplomatic relations with all the major countries in the world. Qatar is a strategic trade partner to the People’s Republic of China, and the relationship between the two countries growing stronger despite several issues.

The Qatari people have shown their resilience even in the times of illegal blockade, where the close neighbours weren’t on good terms with them. They firmly believe in the fruits of hard work, independent decision-making and effective management of the country’s resources, with strength in solidarity under the Emir of Qatar. These real-life examples show the true spirit of the Qatari people who are enterprising, generous and honest by virtue.

Qatar has invested in heavily in developing world-class infrastructure, legal framework with international standards and efficient administration. The country offers benefits of an exceedingly advanced economy, with state-of-the-art facilities enhancing productivity, quality and best-in-class services.

Major Cities in Qatar for Starting your Business

1. Doha City, Ad Dawah

Doha is the capital city and seat of Government; it is a significant economic hub as well as the commercial, cultural and educational centre of the country. It has the country’s main seaport and modern international airport. It has an advanced road system linking it with the theinternational road network, and it is Qatar’s cultural, commercial and financial centre. Ad Dawah is a place filled with desert escapades, water sports, shopping indulgence, modern sporting equipment, historical museums, fine-dining, luxurious attractions and other natural attractions.

2. Al Rayyan City, Al Rayyan

Al Rayyan is located 10 kilometers north of Doha. It is the largest residential area outside of Doha.

3. Al Khor City, Al Khawr

Al Khor is a coastal city 57 kilometers north-east coast of Doha with a port for Municipality includes the emergent Industrial City of Ras Laffan. Al Khor is renowned for its harbour comprising fishing boats and small crafts. It is also famous for its beaches, historic towers and mosques.

4. Al Wakra City, Al Wakrah

Al Wakra is situated between Doha and Mesaieed, 15 kilometres from Doha, and has a small harbour for fishing boats. Al Wakra evolved itself into a small town with an industrial population who usually work in Mesaieed and Doha city.

5. Dukhan, Al Shahaniya

Dukhan had one of the first onshore oil production centres, oil in the Dukhan oil field was first drilled in 1939. It is situated halfway along the western coastline of the Qatari Peninsula. It has developed since the exploitation of the country’soil reserves commenced in 1949. Dukhan has one of the oldest mosques in the region Al Khotba Mosque, erected in 1942. There is a watersports club in the area called Dukhan Water Sports offers services such as powerboat sports, jet skiing and windsurfing.

6. Umm Said, Al Wakrah

Umm Said is the core of Qatar’s industry, situated 45kms south of Doha, on the east coast peninsula. It is both an oil-export and commercial port with refineries, as well as other industrial establishments producing natural gas liquids, steel, petrochemicals and fertilisers. Umm Said has excellent beaches too.

Industrial Cities in Qatar

1. Ras Laffan Industrial City (RLIC), Ras Laffan

The Ras Laffan Industrial City is a 40 sq. Km estate, strategically located on the north shore of the Qatari Peninsula and at the centre of the Arabian Gulf, and because of its proximity to the North Field (the largest natural gas field in the world) the RLIC facility is used to operate the Ras Laffan offshore site. The Ras Laffan Industrial City is the home to the Pearl GTL Plant world’s most massive Gas-To-Liquid complex and host of many hydrocarbon-based industries including Qatargas, Rasgas.

2. Mesaieed Industrial City, Al Wakrah

Located 45kms south of Doha, Mesaieed is the major industrial city in Qatar. It has a large seaport as well as the main terminal for the export of oil and other hydrocarbon products. The city has industrial area housing primary industries, a large seaport, and the main terminal for export of oil. The beaches atMesaieed with their beautiful sand dunes are considered to be among the most important tourist areas in Qatar. The Mesaieed Industrial City host significant industries such as Qatar Petroleum Refinery, Qatar Fertilizer Co. and various other industries.

Types of Business Entities in Qatar

While planning to start a business in the state of Qatar, it is essential to select the perfect type of business vehicle for your company in Qatar. The government has created company structures for businesses interested in starting operations in the country according to the activity.

  • One Person Company
  • Limited Liability Company
  • Public Shareholding Company or Joint Stock Company
  • Branch of a Foreign Company
  • Representative Trade Office

Facts about Qatar

The Limited Liability Company structure is the most common form used by international businesspeople to start their ventures in Qatar. Click here to know more about starting an LLC in Qatar as a foreigner

Relaxed immigration for migrant workers and very fewer restrictions on recruiting staff from overseas which can significantly reduce business costs

Qatar’s population is about 88 percent foreign at any given time the country is home to 180 different nationalities. Major communities in Qatar come from India, Nepal, Bangladesh, Philippines, Egypt, Sri Lanka, and Pakistan

Qatar has one of the highest GDP per capita income in the world

It is the world’s largest liquid natural gas exporter with 910.5 trillion cubic feet of natural gas in the Northern Fields

Free Zones in the State of Qatar

Free zones in the State of Qatar have distinctive regulations allowing foreign investment in Qatar and offers specialised purpose-built infrastructure, facilities, cutting-edge technological foundation, state-of-the-art zones with unique equipment for industries, companies and businesses operating out of the zone. Furthermore, the free zone provides 24/7 security, exclusive support services, a relaxed set of rules, excellent connectivity with other manufacturing zones and free zones.

  1. Qatar Financial Centre
  2. Qatar Science and Technology Park

Click the links above to know detailed information about the respective Qatar free zone.

Process for Setting up your company in Qatar

1. Commercial Registration

Commercial registration is the first step in registering your business in Qatar.

2. Trade Name Registration

Trade name reservation with the Ministry of Economy and Commerce in Doha.

3. Opening a Temporary Bank account

Open a temporary bank account for handling your company’s finances.

4. Drafting the Articles of Incorporation

Articles of Incorporation and Memorandum of Association must be prepared on behalf of the company and submitted to the authorities when required.

5. Issuance of CR

After the issuance of the Commercial Registration, you will have the following with you at the end.

  1. Registration with the Ministry of Economy and Commerce you can open a permanent bank account, dispatch invoice, accept payments and carry out transactions
  2. Trade License issued by the Ministry of Economy and Commerce with which you can carry out the licensed business activity in the country
  3. Computer Card with which you are authorised by the Qatar Immigration to hire someone or sponsor residence visa for an expatriate employee to work in your business

Click on the link to get detailed information on how to register your company in Qatar

The State of Qatar through its visionary plans and cutting-edge infrastructure projects planned in 2019 according to the comprehensive strategy for growth “Qatar Vision 2030” is accelerating the country on the path to success. The massive diversification of Qatar’s economy over the dependence on hydrocarbons has been reflected in the policies of the government, as the state is actively enhancing its capabilities to develop a diversified commercial and industrial base. 

Besides, the state’s open trade policies and the extraordinary economic strategies combined with the help of the foreign direct investment which encourages international business to operate in Qatar while they largely contribute to the economy by diversifying its growth in finance, construction, technology and educational services. If you are interested in known more about starting your business in Qatar feel free to contact us for any queries.