Services
Structures built to hold, protect and grow.
Each engagement is led by a named adviser and supported by a compliance team that keeps every filing on schedule.
01
Labuan Company
A company incorporated under the Labuan Companies Act 1990 — 100% foreign ownership allowed.
- Incorporation within 48 hours upon completion of documents
- No minimum capital and no authorised share capital requirement
- Can own controlling stakes in a Malaysian domestic company
A Labuan Company (“LC”) is a company incorporated or registered under the Labuan Companies Act 1990. It may be limited by shares or by guarantee, or be an unlimited company, and is able to participate in a wide range of business activities. Residents and non-residents of Malaysia are permitted to establish an LC, with 100% foreign ownership allowed.
What is a Labuan Company?
- Incorporated or registered under the Labuan Companies Act 1990.
- May be a company limited by shares or by guarantee, or an unlimited company.
- Able to participate in business activities.
- Would need to be licensed if it intends to undertake businesses as defined under the Labuan Financial Services and Securities Act 2010 and the Labuan Islamic Financial Services and Securities Act 2010.
- Can own controlling stakes in a Malaysian domestic company.
- Residents and non-residents of Malaysia are permitted to establish an LC.
- 100% foreign ownership allowed.
Characteristics
- Shall have at least one resident director and one resident secretary.
- No minimum capital and no authorised share capital requirements.
- The shares issued shall have no par or nominal value.
- Shall have a registered office in Labuan, which is the office of the resident secretary.
- Incorporation within 48 hours upon the completion of all required documents.
- No bearer shares are allowed.
Accepted for listing at key international exchanges
- National Stock Exchange of Australia
- Hong Kong Stock Exchange
- Singapore Exchange
- NASDAQ Dubai
02
Labuan Trust
A highly effective vehicle for asset preservation, protection and income distribution.
- Purpose, charitable, spendthrift/protective and Labuan special trusts
- Open to both residents and non-residents
- Established under the Labuan Trust Act 1996
A Labuan trust is a highly effective vehicle for asset preservation, protection and income distribution, making it one of the primary vehicles used to pass wealth from one generation to the next. It provides unparalleled financial control with exceptional fiscal advantages.
What is a Labuan Trust?
The creation of a Labuan trust is generally for an individual or a settlor to give specific property to a third party to be held for the benefit of others, including charities.
The Labuan Trust Act 1996 allows the creation of the following types of trust:
- Purpose trusts
- Charitable trusts
- Spendthrift or protective trusts
- Labuan special trusts
What is the purpose of a Labuan Trust?
A Labuan Trust may be created or established for a specific particular purpose which could be charitable or otherwise. A charitable purpose means and includes any of the following:
- The relief or eradication of poverty
- The advancement of education
- The promotion of art, science and religion
- The protection of the environment
- The advancement of human rights and fundamental freedom
- Any other purposes which are beneficial to the community
Who can set up a Labuan Trust?
A resident or non-resident can do so. In the case of a non-resident, Malaysian property can be injected into a Labuan Trust, while a Malaysian resident can place international assets into a Labuan Trust — but Malaysian property requires the approval of the regulator, Labuan FSA.
03
Labuan Foundation
A civil-law structure described as a hybrid of a trust and a corporation, for families and corporations.
- Available in conventional or Islamic form
- Charitable or non-charitable purposes
- Governed by the Labuan Foundations Act 2010
A Labuan Foundation (“LF”) is based on a civil law structure and can be described as a hybrid of a trust and a corporation. It is tailor-made for high net worth individuals (HNWI), families as well as corporations and non-profit organisations who wish to have control over their assets and businesses whilst being accorded legal protection. An LF may be established for any lawful purpose, which may be charitable or non-charitable.
Non-charitable Labuan Foundation (conventional or Islamic)
Endowment of properties can only be done by the founder and the person to whom he had assigned or transferred his rights, powers and obligations under the Labuan Foundations Act 2010 (referred to as “the assignee”). In this regard, a non-charitable foundation is not permitted to receive donations from third parties or the public.
Charitable Labuan Foundation (conventional or Islamic)
- Private: not permitted to receive donations from third parties or the public.
- Public: allowed to solicit public donations.
Charitable purposes include
- The prevention and relief of poverty
- The advancement of religion, profession or education
- The advancement of health including the prevention and relief of sickness, disease or of human suffering
- Social and community advancement including the care, support and protection of the aged, people with a disability, children and young people
- The advancement of culture, arts and heritage
- The advancement of amateur sport, which promotes health by involving physical or mental exertion
- The promotion of human rights, conflict resolution and reconciliation
- The advancement of environmental protection and improvement
- The advancement of animal welfare
- The advancement of facilities for recreation or other leisure-time occupation in the interest of social welfare
04
Labuan Banking
Deposit-taking, investment banking, Labuan financial business and Islamic banking business.
- Conventional and Islamic banking licences
- Investment banking and treasury activities
- Licensing submissions with Labuan FSA
Labuan banking means the business of receiving deposits on current accounts, deposit accounts and savings accounts, and includes investment banking business, Labuan financial business, Islamic banking business and such other transactions and terms and conditions as specified by Labuan FSA. It is governed by Part VI of the Labuan Financial Services and Securities Act 2010 (LFSSA).
What is investment banking?
Investment banking means the business of providing credit facilities and consultancy and advisory services relating to corporate and investment matters, including making investments on behalf of any person. Other activities include undertaking foreign exchange transactions, interest rate swaps, dealings in derivative instruments or derivative financial instruments, or any other similar risk management activities.
What is Islamic banking?
Islamic banking is defined as a banking business that is in accordance with Shariah principles.
Who may apply?
Organisations that meet the following minimum criteria may apply for a Labuan banking licence:
- Must be a bank or financial institution
- Possesses a sound track record
- Accorded a good credit rating by acceptable rating agencies
- Supervised by a competent regulatory authority
- Conforms to generally accepted standards of international banking practices or the Bank for International Settlements (BIS)
05
Fund Management
Management services including investment advice or administration in respect of securities.
- Conventional and Islamic fund management
- Application and licensing support with Labuan FSA
- Company set-up under the Labuan Companies Act 1990
A Labuan fund manager is defined as a person who, for valuable consideration, provides management services which may include investment advice or administrative services in respect of securities for the purposes of investment, including dealing in securities. For a Labuan fund manager undertaking Islamic fund management activities, its operation shall also comply with Shariah principles.
Eligibility
The eligible applicant to carry on business as a Labuan fund manager in Labuan IBFC includes:
- An individual who holds a relevant degree or professional qualification to carry on fund management activities. Labuan FSA may also consider an applicant with a minimum qualification of diploma holder and 3 years' relevant experience in the capital market or direct experience in fund management activities.
- An approved fund manager or any provider of such services from a country or jurisdiction which is a member of the International Organization of Securities Commissions (IOSCO).
- A person who does not fulfil the above may also be considered, provided that the fund management activities are run and managed by suitably qualified and experienced individuals.
After approval
Upon receiving approval from Labuan FSA, the applicant is required to establish a Labuan company incorporated or registered under the Labuan Companies Act 1990 (LCA).
06
Labuan Leasing
Letting or sub-letting of property on hire, including bareboat charters of ships.
- Taxed at 3% of audited net profits
- Zero withholding tax on dividends, interest and lease rentals to non-residents
- Popular with oil & gas, aviation and shipping groups
Labuan leasing is defined as the business of letting or sub-letting property on hire for the purpose of the use of such property by the hirer, regardless of whether the letting is with or without an option to purchase the property, including charters of ships. Leasing businesses could be transacted via conventional means or in accordance with Shariah principles.
What qualifies as property?
Property includes any plant, machinery, equipment or other chattel attached or to be attached to the earth. Charters of ships means bareboat charters only, and does not include the transportation of passengers or cargo by sea, or the charter of ships on a voyage or time charter basis.
Companies from the oil and gas industry, airlines, shipping and other large corporations structure their leasing arrangements via Labuan IBFC's efficient tax regime and business-friendly regulatory environment.
Regulated and licensed by Labuan Financial Services Authority (Labuan FSA), Labuan leasing companies enjoy an ideal balance of fiscal neutrality and certainty, allowing for effective management of their operational cost. In addition, it is cost-efficient to create economic substance on Labuan island, where there is a large English-educated population and an extensive array of service providers.
Key benefits of Labuan leasing
- Taxed at 3% of audited net profits pursuant to the Labuan Business Activity Tax Act 1990
- Zero withholding tax on payment of dividends, interests and lease rentals to non-residents
- No foreign exchange control
- No import duty or sales tax
- Double Tax Agreements between Malaysia and over 70 countries
- 100% exemption for director's fees received by non-citizen directors of a Labuan Company
07
Labuan International Commodity Trading
A dedicated Labuan company for physical commodity trading, able to operate anywhere in Malaysia.
- Trading in physical commodities and related derivatives
- Lower operating cost than other global trading hubs
- Access to world-class storage facilities
A Labuan International Commodity Trading company (“LITC”) is a dedicated type of Labuan Company registered with the Labuan Financial Services Authority (Labuan FSA), the regulator of Labuan International Business and Financial Centre (Labuan IBFC). Uniquely, although set up as a Labuan company, LITCs are allowed to operate anywhere in Malaysia with minimum economic substance in Labuan, and as such are not limited to operating out of Labuan.
Permitted commodities
LITCs are allowed to undertake the trading of physical products and related derivatives of the following commodities:
- Petroleum and petroleum-related products including LNG
- Minerals
- Agriculture products
- Refined raw materials
- Chemicals
- Base minerals
- Coal
Key considerations
Lower operation cost — the cost of operations in Malaysia is substantially lower than in other commodities trading hubs across the world, such as London and Geneva. Neighbouring Singapore is the only other commodities trading hub in Asia Pacific, but the cost of doing business as well as living on the island city-state has become less competitive over the years.
World-class storage facilities — traders have access to world-class storage facilities such as Tanjung Pengerang in Johor. This deep water port (up to 26 metres) offers large super tankers easy access to storage facilities while being close to international shipping routes and Singapore's international petroleum hub.
Risk mitigation — as a comprehensive business and financial centre, Labuan offers traders an extensive range of insurance and risk management solutions.
08
Work Permit Application
Employment pass and dependant pass applications for directors, professionals and business owners.
- Dependant passes for spouses and children 18 and under
- Residence permitted in Labuan and West Malaysia
- Renewal every two years
The work permit provides individuals with the opportunity to live and work in Labuan while enjoying several benefits and privileges. The employment pass programme is open to both professionals and business owners who are interested in exploring the opportunities available in Labuan.
Benefits of a Labuan work permit
- Applicant can reside not only in Labuan Island but also in West Malaysia.
- In addition to directors and expatriates, work permits will be granted as dependant passes to their spouses and children 18 years old and under.
- It is possible to smoothly carry out meetings and business trips between Labuan and other countries (e.g. Japan, Hong Kong, Singapore).
- Applicant can choose to stay and work in Labuan.
- Renewal procedure is every two (2) years.
- Can open a personal bank account.
- Dividend tax exempted.
Compliance requirements
- The applicant shall ONLY undertake activities as specified under the Labuan legislations.
- The approved work permit is only allowed to be used to undertake business activities of the Labuan entity.
- All applicants must comply with the fit and proper requirement as specified in the Guidelines on Fit and Proper Person Requirements issued by Labuan FSA.
- Failure to adhere to these compliance requirements may result in revocation of the recommendation for work permit by Labuan FSA and initiation of other punitive measures by Labuan FSA, relevant domestic regulators and law enforcement agencies in Malaysia.
09
Other Services
Company management business, corporate secretarial, licensing, tax and accounting support.
- Company secretarial and registered office
- Licensing, corporate tax and accounting services
- Islamic advisory and backroom processing functions
Company management business in Labuan IBFC provides treasury processing services and such other services, and to such persons as may be permitted by Labuan FSA. Provisions of treasury processing activities include back and middle office processing functions, such as confirmation of deals, preparation of accounting records, maintenance of registers and files, as well as custodial services.
Company management business
In line with Shariah related services, company management can also provide Islamic advisory services and backroom processing functions. A Labuan company management that provides Islamic company management services must engage a Shariah Advisory Panel to advise on its operations.
Who can apply for a Labuan company management business licence?
- A firm engaging in company management activities licensed by the regulatory authority in the country of origin, if applicable.
- A Labuan company incorporated or registered under the Labuan Companies Act 1990 which is managed by personnel with the necessary expertise and skills.
- A credible and viable business plan that sets out the approach to implement the proposed business objectives or operations.
- A set of proper internal policies and controls that commensurate with the business profile or risks.
- Board members and senior management that have the competency and experience to undertake company management business.
- No adverse report on the shareholders or directors of the company or applicant.
Our other services
- Licensing Services
- Corporate Tax Services
- Work Permit / Employment Pass
- Opening of Bank Account Services
- Re-domiciliation Exercise
- Formation of Labuan Company and Administration
- Provision of Registered Office
- Corporate Secretarial Services
- Company Secretary
- Accounting Services