INCORPORATION OF LABUAN COMPANY / ENTITY


About Labuan Companies

A Labuan Company

  • May be a company limited by shares or by guarantee
  • 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 lawful in Malaysia in, from or through Labuan
  • Would need to be licensed if it intends to undertake specific businesses including banking, insurance/insurance-related, fund management, leasing, factoring and company management

Residents and non-residents of Malaysia are permitted to establish Labuan companies and with notification to The Authority, Labuan companies can deal with Malaysian companies. These transactions must be 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 Labuan companies 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.

  • A trust company offers the following services, amongst others:
    • Provides the registered office and resident secretary
    • Performs the secretarial duties of the Labuan Company including lodgment 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, and a resident secretary
  • There is no minimum capital and no authorized share capital requirements
  • No par value shares is the new standard
  • 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 required 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