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About Labuan Companies
A Labuan company:
Residents and non-residents of Malaysia are permitted to establish Labuan companies. Section 7(5) of the Labuan Companies Act 1990 (LCA) allows a Labuan company to deal with a resident subject to the filing of notification to Labuan FSA within 10 working days of the transaction.
Business transactions of Labuan companies must be made in currencies other than the Malaysian Ringgit, except for the purpose of defraying administrative and statutory expenses as well as receiving fees and commissions.
Labuan companies can own controlling stakes in a Malaysian domestic company and are also allowed to undertake shipping operations with non-residents.
- may be a company limited by shares or by guarantee or an unlimited company.
- may participate in business activities and enjoy attractive tax benefits provided under the Labuan Business Activity Tax Act 1990 (LBATA).
- may carry out any business that is permitted in Malaysia in, from or through Labuan.
- would need to be licensed if it intends to undertake specific businesses as defined under the Labuan Financial Services and Securities Act 2010 or the Labuan Islamic Financial Services and Securities Act 2010, which may include the banking, insurance/insurance-related, fund management, leasing, factoring and company management businesses.
Business transactions of Labuan companies must be made in currencies other than the Malaysian Ringgit, except for the purpose of defraying administrative and statutory expenses as well as receiving fees and commissions.
Labuan companies can own controlling stakes in a Malaysian domestic company and are also allowed to undertake shipping operations with non-residents.
Registration Requirements
The LCA requires a Labuan company to employ the services of a trust company to act as its incorporation agent. The services offered by a trust company include, but are not limited to, the following:
- Provides the registered office and resident secretary.
- Performs the secretarial duties of the Labuan company including lodgement of any documents required under the LCA.
- Makes available any of its trust officers for appointment as resident director and resident secretary.
Characteristics of a Labuan Company
- It must have at least one director.
- It must have a resident secretary.
- There is no minimum capital and no authorised share capital requirements.
- The shares issued shall have no par or nominal value.
- Treasury shares are allowed.
- It may issue shares of different classes and of different rights, but no bearer shares are allowed.
- Amalgamation by merging two or more companies into one is allowed.
- It is a requirement to have a registered office in Labuan which is the office of the resident secretary.
- No person may divulge to others any information concerning the shareholding, management and any business, financial or other transactions of a Labuan company.
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