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Labuan Leasing
Labuan leasing is defined as the business of letting or sub-letting property on hire for the purpose of the use of such property by the hirer, regardless whether the letting is with or without an option to purchase the property, including charters of ships.

Property includes any plant, machinery, equipment or other chattel attached or to be attached to the earth, and charters of ships means bareboat charters only and does not include the transportation of passengers, cargo by sea or the charter of ships on a voyage or time charter basis.

Leasing businesses could be transacted via conventional means or in accordance with Shariah principles.
  • An applicant is required to submit an application of which the submission should include the following:
    1. A business plan detailing the operations of the applicant and the nature of the leasing transactions, including whether they would be conducted with residents or non-residents
    2. Group corporate shareholding structure
    3. Diagram of leasing transaction
    4. The composition of the board of directors for the proposed leasing company; and
    5. Any other information that may be relevant to the application.
  • An approved leasing company is required to:
    1. Maintain bank account(s) under its name preferably in Labuan IBFC and Malaysia to facilitate the leasing operation including lease remittances / lease rentals
    2. Comply with any other requirements of the changes being effected by Labuan FSA from time to time
    3. Ensure that the lease agreement is duly stamped and endorsed by the Collector of Stamp Duties, at the Stamp Duty Office of the Inland Revenue Board of Malaysia
    4. Transact business only in foreign currency and not deal in Malaysian Ringgit except for the purpose of defraying administrative and statutory expenses as permitted under the Financial Services Act 2013
    5. Notify Labuan FSA of any changes to its constituent documents and business plans within 30 days
    6. Obtain approval from Labuan FSA on any new appointments or changes to its directorship and shareholding information
    7. Notify Labuan FSA on the termination and extension of any leasing transactions within 30 days upon the termination / extension
    8. Conduct its business with due diligence and sound principles and comply with the laws and regulations where it conducts its leasing business
    9. Ensure all transactions are done through Labuan, and adequate and proper records and books of accounts are maintained in Labuan
    10. Ensure all its leased assets are adequately insured; and
    11. Ensure all leasing transactions with its related party comply with the transfer pricing rules issued by the related party’s relevant authorities.
  • All licensees are required to pay to Labuan FSA annual licence fees on or before 15 January of each year:
    Type of Fees
    Amount
    Lease to Non-Malaysian Residents
    Annual Fee
    RM 60,000
    USD 20,000
    Nil
    Each Subsequent Leasing Transaction
    RM 20,000
    (One off)
    USD 6,000
    Nil
Governing Legislation
For a complete list of all Labuan laws, please click here.
Related Guidelines and Circulars
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