Registering a Foreign Company Branch in Malaysia

The registration fee is the part everyone budgets for. It is not the part that hurts.

A foreign company registering a Malaysian branch pays between RM5,000 and RM70,000 once. Then it lodges an annual return at RM500, financial statements at RM200, the whole foreign parent’s accounts, and a separately audited statement of the assets used in and liabilities arising out of its Malaysian operations — every year, forever, with a named local individual personally on the hook for the penalties if any of it is late.

Compare that against a locally incorporated Sdn Bhd at RM1,000 to set up, RM150 a year for the annual return and RM50 for audited financial statements, and the branch decision looks different.

When you must register — and when you need not

Section 561(1): a foreign company shall not carry on a business in Malaysia unless it is registered as a foreign company under the Act. Section 561(4) makes the foreign company and every officer who contravenes it an offender.

Section 561(3) stretches “carrying on business” to include establishing or using a share transfer or share registration office, and administering, managing or otherwise dealing with property situated in Malaysia as an agent, legal personal representative or trustee.

The Thirteenth Schedule then pulls ten activities back out. A foreign company is not carrying on business in Malaysia merely because it:

• is party to an action, suit, administrative or arbitration proceeding, or settles one;
• holds meetings of its directors or shareholders or deals with its internal affairs;
• maintains a bank account;
• effects a sale through an independent contractor;
• solicits or procures an order that becomes binding only if accepted outside Malaysia;
• creates evidence of a debt or a charge over movable or immovable property;
• secures or collects debts, or enforces security for them;
• conducts an isolated transaction completed within thirty-one days, not being one of a series repeated from time to time;
• invests funds or holds property; or
• temporarily imports goods under the Customs Act 1967 for display, exhibition, demonstration or as trade samples, for re-export within three months.

Read that list before you conclude you need a branch. A great deal of cross-border selling into Malaysia sits inside paragraph (e).

What registration costs

Item 32 of the fee schedule in the Companies Regulations 2017, keyed to share capital converted into ringgit at the prevailing rate:

Share capital	Registration fee
Not more than RM1 million	RM5,000
Over RM1m up to RM10m	RM20,000
Over RM10m up to RM50m	RM40,000
Over RM50m up to RM100m	RM60,000
Over RM100 million	RM70,000
No share capital	RM70,000

A name reservation is RM50 for every thirty days or part, capped at 180 days. Under s.564(1) the branch must be registered under the same name as in its place of origin, subject to that name being available under s.26 — so a parent whose name collides with an existing Malaysian entity has a real problem, not a rebranding exercise.

What you file to register

Section 562(1) requires: the name, identification, nationality and ordinary place of residence of every shareholder in Malaysia (with corporate details where a shareholder is a body corporate); the same for every person appointed a director of the foreign company in Malaysia; the list of shareholders or members at the place of origin; class and number of shares at the place of origin; for a company limited without share capital, the amount each member undertakes to contribute on winding up; and the name and address of a Malaysia-resident agent appointed under a memorandum of appointment or power of attorney.

SSM’s guideline adds the documents: a certified copy of the certificate of incorporation or registration, a certified copy of the memorandum and articles or equivalent constitution if available, the name reservation application and the approval email, plus the agent’s statement of consent. Anything not in Bahasa Malaysia or English needs a certified translation.

SSM’s published expectation is a notice of registration within one working day of a complete submission. A certificate of registration is issued only on request, with a fee.

The agent is not an administrative formality

Section 563(1) requires a foreign company to appoint an agent in Malaysia at all times, who:

• continues to be the agent;
• is answerable for all acts, matters and things required to be done by the foreign company under the Act; and
• is personally liable to all penalties imposed on the foreign company for any contravention of the Act, unless the agent satisfies the court hearing the matter that the agent should not be liable.

Note the scope. Not the foreign-company chapter — the Act. And the burden runs against the agent.

Changes to the agent’s registered particulars are notified within 14 days (s.563(2)). Cessation runs on a 21-day clock from lodgement of the notice, or immediately on lodgement of a successor’s appointment, whichever is earlier (s.563(4)). If the branch keeps trading, a replacement must be appointed within 21 days (s.563(5)). Leaving the office empty while you look for a volunteer is not an option the Act contemplates.

The ongoing burden

Registered office. At all times within Malaysia, open and accessible to the public during ordinary business hours (s.566(1)). Lodged within 30 days of establishing a place of business (s.566(2)).

Name display. Section 565 requires the name and the place of incorporation exhibited in romanised letters outside the registered office and every place of business, and stated on business letters, notices, official publications including electronic media, websites, bills of exchange, cheques, orders, invoices, receipts, letters of credit and all other business correspondence. Where the name appears in non-romanised characters, the romanised version must be at least of equal size (s.565(2)).

Changes. Fourteen days for changes to the constitution, directors, agent, registered office or its opening hours, the home-country registered office address, the name, or the powers of Malaysia-resident local board directors (s.567(1)). Thirty days for share capital increases and for court orders corresponding to s.366.

Annual return. Once every calendar year, not later than 30 days from the anniversary of the registration date (s.576(3)) — note that is the registration anniversary, not a financial year end. The return must carry the registered office and every business place, where the register of members and financial records are kept, the shareholding structure, the total amount of its indebtedness in Malaysia, particulars of directors, officers, auditors and agents in Malaysia, and the list of shareholders. Fee RM500.

Financial statements. Within two months of the AGM of the foreign company, a copy of its own financial statements in the form its home law requires, with a statutory declaration verifying the copies (s.575(1)). If the home jurisdiction requires neither an AGM nor financial statements, s.575(4) makes the branch prepare accounts as if the foreign company were a Malaysian public company.

Then the provision that prices the whole exercise: s.575(5)(b) — a duly audited statement showing the assets used in, and liabilities arising out of, its operations in Malaysia. “Duly audited” means a report by an approved company auditor under s.266, plus a statutory declaration by the agent or the person responsible for financial management (s.575(8)). Fee RM200.

Section 575(7) gives the Registrar a waiver power over s.575(5) where compliance is impractical given the nature of the operations, of no real value given the amounts, disproportionately expensive, or misleading or harmful to the business. It is a discretion, not an entitlement — apply, do not assume.

Late lodgement. Practice Directive 1/2017 (revised 1 October 2024) bands foreign companies at RM150 / RM250 / RM300 / RM500, three times the private-company scale, with the bands beginning after seven days.

Closing the branch

Section 578(1): if the foreign company ceases to have a place of business or to carry on business in Malaysia, it lodges notice within seven days. From lodgement, the obligation to lodge further documents ceases — but anything already due stays due. The Registrar removes the name from the register twelve months after the notice.

Seven days is the tightest clock in the whole chapter, and it is the one most often missed because the commercial decision to withdraw usually predates the filing by months.

Common mistakes

• Registering a branch when the Thirteenth Schedule covers you. Orders accepted outside Malaysia, a bank account, or holding property do not by themselves trigger s.561.
• Pricing only the registration fee. The recurring RM500 plus RM200, the audited Malaysian assets-and-liabilities statement, and the agent’s exposure are the real cost.
• Treating the agent role as clerical. Section 563(1)(c) is personal liability with a reverse onus, across the whole Act.
• Diarising the annual return from the financial year end. It runs from the registration anniversary.
• Forgetting the website. Section 565(1)(b)(ii) names it expressly.
• Assuming a branch limits liability. It does not. The branch is the foreign company; a subsidiary is a separate legal person.
• Missing the seven-day cessation notice and continuing to accrue lodgement duties.

What’s next

Test your activity against the Thirteenth Schedule first — if you fall inside it, the whole exercise disappears. If you genuinely have to be registered, model the branch against a locally incorporated subsidiary on three axes: the s.575(5) audited Malaysian statement, whether you can accept exposing the foreign company rather than a ring-fenced entity, and who will accept the agent appointment knowing what s.563(1)(c) says.