Setting up Regional Operations
Malaysia holds many attractions for multinational companies (MNCs) looking for a strategic location to headquarter their global operations. In line with the trend of company hierarchies and decision-making processes shifting towards a more decentralised model, many MNCs are moving their traditional corporate centres to offshore locations.
Due to its prime geographical location in the centre of ASEAN, Malaysia offers companies close proximity to customers. Apart from this, competitive costs of operation, as well as strong supply chain linkages in the regional market, underscore the importance of Malaysia as a regional hub location.
The Government offers various facilities and assistance to investors to set up the following business support service operations in Malaysia:-
- Principal Hub – A locally incorporated company that uses Malaysia as a base for conducting its regional or global businesses and operations to manage, control, and support its key functions including management of risks, decision making, strategic business activities, trading, finance, management and human resource.
i. A Representative Office is an office of a foreign company / organisation approved to collect relevant information on investment opportunities in the country especially in the manufacturing and services sectors, enhance bilateral trade relations, promote the export of Malaysian goods and services and carry out research and development (R&D).
ii. A RegionalOffice is an office of a foreign company / organisation thatserves asthe coordination centre for the company’s / rganisation’s affiliates, subsidiaries and agents in South-East Asia and the Asia Pacific. The Regional Office established isresponsible for the designated activities of the company / organisation within the region it operates.
- Foreign Branch Offices
A Foreign Company may carry out business in Malaysia either by:
i. Incorporating as a local company; or
ii. Registering a branch in Malaysia
A Foreign Company is defined under the Companies Act, 2016 as:
i. A company, corporation, society, association or other body incorporated outside Malaysia; or
ii. An unincorporated society, association, or other body which under the law of its place of origin may sue or be sued, or hold property in the name of the secretary or other officer of the body or association duly appointed for that purpose and which does not have its head office or principal place of business in Malaysia.
