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FAQ General Accordion

General

How does MIDA assist investors?

MIDA offers the following assistance to investors:

  1. Direct consultation and co-operation with relevant agencies at both the Federal and State levels in matters such as:
    • Securing infrastructural facilities, including land, factory sites, electricity and water supplies, telecommunication and others,
    • Expediting approvals relating to Building Plans, Certificate of Fitness and Business Licences
  2. To handhold and assist investors in obtaining all necessary approvals for projects until they are operational
  3. To extend support to existing companies in planning expansion, diversification and other reinvestment of their projects
  4. To facilitate visits and site investigations and supply chain infrastructures.

To further enhance MIDA’s role in assisting investors, senior representatives from key government agencies are based at MIDA’s Headquarters in Kuala Lumpur to advise investors on government policies and procedures. These representatives include officials from the Department of Labour, Immigration Department, Royal Malaysian Customs, Department of Environment, Tenaga Nasional Berhad and Telekom Malaysia Berhad

What are the types of applications evaluated by MIDA?

MIDA evaluates the following:

  • Manufacturing Licence under the Industrial Coordination Act, 1975
  • Incentives
  • Exemption from Custom Duties

  • Expatriate Posts
  • Status for regional establishments
  • Status for R&D company
  • Matching Grants

What are the equity requirements for new, expansion or diversification projects?

Effective from 17 June 2003, foreign investors can now hold 100% equity for all investments in new projects, as well as expansion or diversification projects by existing companies in the manufacturing sectors, irrespective of the level of exports.

How does MIDA act as a single window in facilitating and assisting investors?

To further enhance MIDA’s role of assisting investors, senior representatives from key agencies are stationed at MIDA’s headquarters in Kuala Lumpur to advise investors on government policies and procedures. These representatives include officials from the Department of Labour, Immigration Department, Royal Customs Malaysia, Department of Environment, Tenaga Nasional Berhad and Telekom Malaysia Berhad

Manufacturing Licence

What are the criteria to apply for a Manufacturing Licence?

A company with shareholder’s fund of RM2.5 million and above OR full-time manpower of 75 people or more can apply for a Manufacturing Licence.

How long does it take to approve for Manufacturing Licence?

Manufacturing Licence will be approved within four weeks (normal track) from the date of complete information received or two days from the date of complete information received for non-sensitive activities (e-ML).

How can I find out the status of my company’s application?

All applications received will be issued an acknowledgement letter which will state the names of the Officer / Deputy Director / Director of the relevant Industry Division. Applicants are advised to contact the respective officers on the application status.

If my company is exempted from a manufacturing licence, what other documents can I obtain from MIDA?

The applicant may obtain a ‘Confirmation Letter for Exemption from Manufacturing License’ by submitting their application via http://investmalaysia.mida.gov.my/ and should submit a copy of the following documents:-

  • Memorandum and Articles of Association/ Corporate profile from Companies Commission of Malaysia (CCM)
  • Business Licence from the Local Authorities (if applicable)
  • Manufacturing Process Flow Chart

Can I submit my application for the manufacturing licence online?

Applicants may submit their applications via http://investmalaysia.mida.gov.my/

Incentives for Investment

What are the main incentives for the manufacturing and services sectors?

There are two major tax incentives for the manufacturing and services sectors:

  • Pioneer Status (PS) – Income tax exemption of 70% – 100% of statutory income for 5 to 10 years. Unabsorbed capital allowances and accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer status of the company.
  • Investment Tax Allowance (ITA) – An allowance of 60% – 100% on qualifying capital expenditure (factory, plant, machinery or other equipment used for the approved project) incurred within 5 to 10 years from the date the first qualifying capital expenditure is incurred.

What is the difference between Pioneer Status and Investment Tax Allowance?

A company approved with a Pioneer Status certificate can enjoy income tax exemption between 70% – 100% of statutory income for 5 to 10 years, whereas, for Investment Tax Allowance, a company can get allowances between 60% – 100% on qualifying capital expenditure incurred within a period of 5 to 10 years.

For projects with a longer gestation period and high capital expenditure, it would be more beneficial to opt for Investment Tax Allowance. Companies should study the options before applying either for Pioneer Status or Investment Tax Allowance.

How does a company apply for Pioneer Status/Investment Tax Allowance?

Applicants may submit their applications via http://investmalaysia.mida.gov.my/.

If my company does not have a Manufacturing Licence, can I apply for Pioneer Status/Investment Tax Allowance?

A company exempted from Manufacturing Licence is eligible to apply for Pioneer Status/Investment Tax Allowance if the products/activities are promoted and the project has fulfilled other related criteria.

How can I confirm that my products/activities are eligible to apply for the incentives?

You may check from the list of promoted activities & products available OR https://www.mida.gov.my/forms-and-guidelines/ in our websites or through our publication ‘Malaysia: Investment in the Manufacturing Sector – Policies, Incentives and Facilities’.

How long does it take to consider the application for the incentives?

The incentives will be processed, and the decision will be made within six weeks from the date of complete information received.

How can I find out the status of my company’s application for the incentive?

All applications received will be issued acknowledgement letters which will state the names of the Officer/Deputy Director/Director of the relevant Industry Division. Applicants are advised to contact the respective officers on the application status.

Expatriate Posts

What is the difference between key post and the term post?

A key post is a post that can be held indefinitely by a foreigner based on the foreign ownership of the company. It is also dependent on the amount of paid-up capital of the company and type of product/industries involved. The approval is subjected to a minimum amount of paid-up capital of the company.


A term post is a post approved for up to 3-5 years for executive posts that require professional qualifications and practical experience, and 2 years for non-executive posts that require technical skills and experience. This is subject to the unavailability of Malaysians to fill up the post.


For companies to be eligible to apply for these posts, Malaysians must be trained to eventually take over the posts.

Effective 1st January 2021, company who intend to employ expatriates are required to advertise job vacancies for a minimum of 30 days in MYFutureJobs portal for a minimum of 30 days prior to submitting an application for expatriate posts to MIDA. Company will be required to conduct interview process to source for local talents. Company must comply with the Social Security Organization (SOCSO) guidelines.


Exemption from advertising job vacancies are given to the following categories:

  1. Important positions (C-Suite & Key Posts) 
  2. Expatriate/s with monthly income of RM15,000 and above 
  3. Representative Office/ Regional Office (RE/RO)  
    • The Representative Office/Regional Office of overseas organisations/ companies in the manufacturing and services sectors that are established in Malaysia to carry out activities for the company/organisation headquarters. The representative/regional offices do not involve in any commercial activities. For the operational representative/regional office, employers are not required to register under the Companies Act 1965. The approval/confirmation letter from MIDA is required for the company to employ expatriates under this category
  4. Investors/Shareholders/Owners 
    • Investors are individuals who invest funds in Malaysia to achieve return on investments and directly involved in the company’s operations.
    • Shareholders, meanwhile, must hold at least 30% equity in the company and appointed as the company’s Director and/or hold position of interest in the company.
  5. Corporate Transfers/ Placements / Trade Agreements 
    • Expatriates are assigned by the parent company to work in a branch company in Malaysia or group of companies for the purpose of training or knowledge/experience sharing between companies, and to meet the company’s manpower requirement.


For specialised skilled positions are not automatically excluded from advertising the vacancies in MYFutureJobs portal. Specialised skilled positions include specific and/or unique skills as well as strategic competencies to carry out tasks stipulated by the company.


Company may apply for exemption from advertising in MYFutureJobs portal from SOCSO by completing PDKK Form (Specialised Skilled Expatriates) via ( http://bit.ly/PDKKPERKESO). Detailed justification on why that position requires special exemption need to be indicated in the form.


Company will be exempted from advertising in MYFutureJobs portal if the position is granted exemption by SOCSO via email: [email protected] and the company may proceed to apply for expatriate post to the Approving Agencies.


If the position is found not to fall under specialised skilled, the company will be requested to advertise the vacancy for the position in MYFutureJobs portal for a minimum period of 30 days and conduct interview process to source for local talents. Company need to submit the Expatriate Employment Committee (JPPD) Certificate from SOCSO when applying for the expatriate position to the Approving Agency.


For any inquiries on MYFutureJobs portal, please contact SOCSO’s Customer Services Centre at 1-300-22-8000 / 03- 8091 5300 or email [email protected]

How to apply for an extension or additional expatriate post?

All applications for expatriate posts from new and existing companies (including those not involving expansion or diversification) in the manufacturing and selected services* sectors should be made via online through MIDA e-TRANS portal at URL (https://investmalaysia.mida.gov.my).

How long does it take for a decision on the application for expatriate posts?

The application for expatriate posts will be processed and a decision made within thirty (30) days from the date of complete information received.

Duty Exemption

How does a company apply for import duty and/or sales tax exemption?

Applications for import duty and/or sales tax exemption need to be submitted online via MIDA’s Online Application Portal (https://investmalaysia.mida.gov.my).

What type of applications that can be submitted for import duty and/or sales tax exemption?

Applications for import duty and/or sales tax exemption which involve the following need to be submitted online via https://investmalaysia.mida.gov.my:

  • Import duty and/or sales tax exemption on machinery/equipment for selected activities in the Agriculture Sector
  • Import duty and/or sales tax exemption on raw materials/component for Manufacturing Sectors
  • Import duty and/or sales tax exemption on machinery, equipment and material for companies in selected services sectors as follows;
    1. Research & development (R&D) 
    2. Private higher education institution 
    3. Private higher training institution (science, technical or vocational) 
    4. Tourism project (without accommodation)

Application for MIDA Confirmation Letter or Surat Pengesahan MIDA (SPM) to claim import duty and/or sales tax exemption from the Royal Malaysian Customs Department on machinery/equipment/spare parts/prime movers/container trailers/specialised tools/components/materials/specialised consumables goods for the following::

  • Manufacturers in Principal Customs Area (PCA)
  • Companies Engaged in Hotel Business
  • Haulage Operators
  • Aerospace Maintenance, Repair & Overhaul (MRO) companies

How long does it take to receive a decision on the application of import duty and/or sales tax exemption?

The decision shall be conveyed within 4 weeks from the date of complete information received.

What are the supporting documents required to be attached in the online application form?

A company applying for the exemption should submit a copy of the following documents:

  • Manufacturing Licence issued under the Industrial Coordination Act 1975 or Confirmation Letter for a company exempted from Manufacturing Licence under the Industrial Coordination Act 1975
  • Tax incentive approval under the Promotion of Investment Act, 1986 (PIA) or Income Tax Act, 1967 (if applicable)
  • Registration certificate or the letter of acknowledgement if the application for the registration certificate is pending for approval from the Department of Occupational Safety and Health (DOSH) (if applicable)
  • Company profile (latest printout) generated from Companies Commission of Malaysia (SSM) e-Info Services)
  • Flow chart of manufacturing process
  • The layout plan for the machinery and equipment in the approved manufacturer’s premise and to indicate where the machinery and equipment will be located

What is the procedure to apply for the import duty and/or sales tax exemption?

Please refer to the guidelines and procedures for import duty and/or sales tax exemption application in our website on the following link:

https://www.mida.gov.my/forms-and-guidelines/#tab5

Could a manufacturing company in the Free Industrial Zone (FIZ)/Licenced Manufacturing Warehouse (LMW) apply for duty exemption?

Effective from 1 January 2011, all applications for duty exemption by manufacturing companies in the Free Industrial Zones (FIZ)/Licenced Manufacturing Warehouse (LMW) for sale of their finished goods to Principal Customs Area (PCA) should be submitted directly to the Royal Malaysian Customs Department/nearest Customs station.

Services

What are services sub-sectors that are eligible to apply for status and/or incentives and/or expatriate applications through MIDA?

Companies undertaking the following selected services or activities may apply for status and/or incentives and/or expatriate:

  • Research and Development Activities;
  • Principal Hub;
  • Integrated Logistics Services (ILS);
  • International Integrated Logistics Services (IILS);
  • Representative Office/ Regional Office (RE/RO);
  • Technical/Vocational/Science Training Institutes;
  • Hotels/Tourism Projects;
  • Mines Wellness City (MWC);
  • Green Technology;
  • Private Healthcare Facility;
  • Cold Chain Facilities; and
  • Other Services Activities Promoted under the Promotion of Investments Act, 1986 and Income Tax Act, 1967

Companies undertaking the following selected services or activities may apply for additional products and/or expatriate:

  • Operational Headquarters (OHQ)/ International Procurement Centres (IPC) / Regional Distribution Centres (RDC);

What is the procedure to apply for status and/or incentives and/or expatriate application for the above services sub-sectors?

All applications (excluding Application for Replacement of Expatriate Posts for RE/RO and Annual Compliance Assessment Form for PH) should be made online through MIDA e-TRANS portal at URL ( https://investmalaysia.mida.gov.my)
Applications for Replacement of Expatriate Posts for RE/RO and Annual Compliance Assessment Form for PH should be submitted manually in three (3) sets using the relevant form and submit to:


Chief Executive Officer

Malaysian Investment Development Authority (MIDA)

MIDA Sentral

No. 5, Jalan Stesen Sentral 5

Kuala Lumpur Sentral

50470 Kuala Lumpur

How long does it take to receive a decision for the applications?

The applications will be processed, and a decision will be conveyed to the applicants within six weeks from the date of complete information received.

Post Incentive Application

i. Application for Pioneer Certificate

When to apply for Pioneer Status Certificate?

The application for Pioneer Certificate should be submitted to MIDA within 24 months from the date of incentive approval letter. Upon submission of the application, the applicant company should fulfill one of the following requirements:

  • To achieve a minimum 30% of its installed production capacity within a three (3) consecutive months (applicable for mass production-based company) or
  • To have the first sales invoice of the approved product (applicable for customized order-based company)

How to apply for Pioneer Status Certificate?

The application should be made online via https://investmalaysia.mida.gov.my

How does MIDA determine the Production Day for Pioneer Certificate?

The Production Date of Pioneer Certificate will be determined based on the followings:

  • For mass production-based company
    Based on the first date of the month that the company has reached the minimum 30% of its installed production capacity within a three (3) consecutive months.
  • For customised order-based company
    Based on a date of company’s first sales invoice.

How long does it take to process the Pioneer Status Certificate application?

The Pioneer Certificate application will be processed within 30 days upon the acceptance of complete application from the company.

Do companies allow to extend the application for Pioneer Certificate should they unable to meet the requirement?

Companies may apply for extension to obtain the Pioneer Certificate to MIDA within 24 months from the date of incentive approval letter, by providing strong justifications and valid reasons. The extension application will be evaluated based on merits of case.

What if the company failed to submit the application for Pioneer Certificate within the time period stipulated in the incentive approval letter?

MIDA will initiate a process of incentive withdrawal.

ii. Application for Determination of Effective Date for Investment Tax Allowance (ITA)

When to apply for Determination of Effective Date for Investment Tax Allowance?

 

The application should be submitted to MIDA within 24 months from the date of incentive approval letter via https://investmalaysia.mida.gov.my.

How long does it take to process the application for Determination of Effective Date for the Investment Tax Allowance?

The application will be processed within 30 days upon the acceptance of complete application from the company.

iii. Application for Verification of Compliance to Investment Tax Allowance

When to apply for Verification of Compliance to Investment Tax Allowance?

The application should be submitted to MIDA within the effective incentive period. The company should obtain the approval for the Verification of Compliance to Investment Tax Allowance before made a tax claim with the Inland Revenue Board (IRB). The application should be made online via https://investmalaysia.mida.gov.my.

How long does it take to process the application for Verification of Compliance to Investment Tax Allowance?

The application will be processed within 30 days upon the acceptance of complete application from the company.

Post Licensing Application

i. Applications Related to Amendments/Changes of Manufacturing License

Companies which require to make any amendments / changes on Manufacturing License (such as change of company’s name, amendment of factory address, change of factory location, duplication and consolidation of Manufacturing License etc) may submit their post licensing applications via https://investmalaysia.mida.gov.my.

ii. Applications Related to Updating/Waive of Manufacturing License Conditions

Companies that require to update Manufacturing License conditions / to waive some of the conditions (such as equity and export conditions), may submit their applications via https://investmalaysia.mida.gov.my.

How long does it take to process the Post Licensing applications?

The application will be processed within 30 days upon the acceptance of complete application from a company.

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