3 Important Considerations Before Incorporating Your Company in Malaysia

Applying for a visa in a foreign country can be a cumbersome process, especially if you are a foreign entrepreneur seeking to expand your business in a different jurisdiction such as Malaysia. The most common way of applying for a work visa in Malaysia for foreign entrepreneurs is through the Professional Work Permit Visa (DP10). However, this method requires you to first register company in Malaysia before you can go about applying for a work visa. Alternatively, if your company is in the tech industry, you may wish to consider applying for the Malaysia Tech Entrepreneur Program (MTEP).

1. Apply for Malaysian work permit through the DP10

If you are interested in setting up business in Malaysia, you can choose to apply for the Professional Work Permit Visa (DP10). The DP10 is meant for foreign expatriates who are skilled workers and is also known as Expatriate Visa or Director Visa. This work visa has an initial validity of 1-2 years but can be extended if you wish to stay in Malaysia for a longer period of time. To apply for this visa, you will have to be aged between 27 and 50. If you are below 27 years old, you will be asked to submit extra documentation. This visa also allows you to apply for a dependent pass for your immediate family.

An important point to take note of is that you will need to have a Malaysian employer to apply for this visa. This means that you must first complete Malaysia company formation before you can apply for your work visa. For your company to be eligible to apply for work permits, your company will need to have a paid-up capital of RM 500,000 – RM 1,000,000, depending on whether your company is wholly foreign owned and the type of industry your business is in. Additionally, the shares owned solely by foreigners in the company must be a minimum of RM 500,000.

2. Apply for Malaysia Tech Entrepreneur Program (MTEP)

Alternatively, if you are an entrepreneur whose business is in the tech industry, you may wish to consider applying for the MTEP. The MTEP is a programme initiated by the Government of Malaysia and the Malaysia Digital Economy Corporation (MDEC), with the main goal of attracting prospective tech entrepreneurs to set up their business in Malaysia.  There are two types of visas which you can apply for under this program – the Professional Visit Pass (PVP-MTE) and the Residence Pass (RP-MTE). The PVP-MTE is meant for new entrepreneurs and is valid for only 1 year while the RP-MTE is meant for established entrepreneurs whose companies have been incorporated for at least 3 years and is valid for up to 5 years. Like the DP10, you do not need to be in Malaysia to apply for either visa.  However, if you are applying for the PVP-MTE, your company office will need to be located at one of the Malaysia Digital Hubs or their recognized partner organizations. There is no restriction in the location of the company office for established entrepreneurs applying for the RP-MTE. In addition, you are only eligible to apply for a dependent pass for your immediate family if you are applying for the RP-MTE.

Both visas require the applicant to have a minimum amount of RM 50,000 in their bank accounts, while the RP-MTE requires additional proof of business performance. You will also need to submit a certificate of good conduct from your residing country and prepare a business pitch deck to describe your business plan in Malaysia. In addition, you will need to get a sponsor to vouch for your credibility. For PVP-MTE applicants, this can be the Malaysia Digital Hubs or MTEP recognised partners, whereas for RP-MTE applicants, you will have to obtain a declaration form from a Malaysian sponsor or individual.

The application process will take up to 4 weeks and the fee charges are as follows:  RM 2,650 for PVP-MTE and RM 5,300 for RP-MTE. The application can be done via the official MTEP website.

Conclusion

Unless your business is in the tech industry, the main way to apply for a work visa for foreign entrepreneurs will still be through the DP10. While the cost of setting up a company in Malaysia is not high, the process to register your company and apply for the correct work visa can be a long and tedious one.

Tetra Consultants will provide you with a fast and simple way to register your company in Malaysia through our service package, which includes registering your company with the Commission of Malaysia (SSM), securing a work visa for you and your partners, opening a corporate bank account, assisting in accounting and tax obligations, and providing a nominee resident director and a local company secretary, in accordance with the requirements to set up a company in Malaysia. If you wish to know more about how to register your company in Malaysia, feel free to contact us. Our team of experts will revert within the next 24 hours.