Requirements to Set Up a Representative Office in Malaysia

Setting up a branch office in Malaysia offers a strategic opportunity for foreign companies looking to expand their operations into the Southeast Asian market. A branch office serves as an extension of the parent company, allowing it to conduct business activities in Malaysia without the need to establish a separate legal entity. If you’re considering this path for your business, understanding the requirements and process is crucial. Here’s a comprehensive guide to help you navigate the setup of a foreign branch in Malaysia.

What is a Branch Office?

A branch office is not a separate legal entity but an extension of the foreign parent company. It must conduct the same business activities as the parent company and is not considered an independent entity. This means that the foreign parent company retains full responsibility for the branch’s liabilities and debts in Malaysia. This setup is suitable for companies looking to test the market or operate temporarily in Malaysia.

Requirements for Setting Up a Branch Office

1. Company Name

   The branch office must use the same name as the foreign parent company. The name should be registered with the Companies Commission of Malaysia (SSM) through their online system. The name reservation is valid for 30 days from the date of approval and can be extended if necessary.

2. Resident Agent

   To establish a branch office in Malaysia, you must appoint at least one resident agent. This individual or entity must be a resident of Malaysia and is responsible for handling official documents and communication on behalf of the branch.

3. Documents Required

   Several key documents are needed to register a branch office in Malaysia:

   • Certified Copy of the Certificate of Incorporation: This document proves the existence of the foreign company.
   • Certified Copy of Memorandum and Articles of Association: If available, this document outlines the company’s constitution.
   • Copy of Name Reservation Application: Documentation showing that the branch office name has been reserved.
   • Copy of Approval Email: Evidence of name reservation approval.
   • Certified Translation: If any documents are in a language other than Bahasa Malaysia or English, they must be translated and certified.
   • Form 79: This form provides details of the directors and any changes to their particulars.
   • Power of Attorney: This document authorizes the appointed resident agent to act on behalf of the parent company.

4. Registration Process

   a. Company Name Registration

   The first step in setting up a branch office is registering the company name with SSM. The fee for this registration is RM50.00. Once approved, the name is reserved for 30 days and can be extended for additional periods.

   b. Submission to SSM

   Within 30 days of name confirmation, you must submit the following information to SSM:

   • Shareholder Information: Include details of every shareholder, including identification, nationality, and residence. For corporate shareholders, provide the corporate name, registration number, and office address.
   • Director Information: List the names, identifications, and residences of directors appointed for the branch office.
   • Share Capital: Provide information about the company’s authorized share capital. The registration fee varies based on the amount of share capital, ranging from RM1,000 for up to RM400,000 to RM70,000 for over RM100 million.

5. Bank Account

   After the registration of the branch office, opening a corporate bank account is the next step. It’s important to select a bank that fits your business needs, as different banks offer various benefits and fee structures. Some well-known banks in Malaysia include:

   • Maybank
   • CIMB Bank
   • Public Bank Berhad
   • RHB Bank
   • Hong Leong Bank Berhad
   • UOB Bank
   • HSBC Bank

   Requirements for Opening a Bank Account

   Banks may require the following documents to open a corporate account:

   • Completed Bank Application Forms: Each bank has its own forms that need to be filled out.
   • Letter of Introduction: Some banks require a letter from an existing customer of the bank.
   • Identification Documents: Photocopies of the directors’ and authorized signatories’ identification cards.
   • Certified True Copies: These should be certified by the company secretary and include the company’s constitution, return of allotment of shares, list of directors, registered office address, certification of incorporation, and board resolution authorizing the account opening.

Conclusion

Setting up a branch office in Malaysia can be a strategic move for foreign companies aiming to expand their market presence in the region. Understanding and fulfilling the requirements for registration, such as company name reservation, resident agent appointment, document preparation, and bank account setup, is essential for a smooth establishment process.

Also Read: How to incorporate a limited liability company in France