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Company Law in Labuan

Updated on Monday 28th June 2021

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Company Law in Labuan.jpgThe company law in Labuan includes a main Act as well as additional Acts and laws that govern the manner in which companies are incorporated and managed. Apart from this Act, the Labuan law that is also relevant for company formation concerns the taxation of companies and/or the incorporation of trusts or funds, for entrepreneurs who are interested in these types of investment vehicles.
 
In this article, our company formation agents list the most important issues included in the Labuan law concerning companies. Interested investors can reach out to our specialists for more information or additional details about the relevant provisions of the Acts as well as complete assistance during the company incorporation phase.
 

The Labuan Companies Act

 
The Labuan Companies Act 1990 is the main law governing the incorporation of companies in the Federal Territory of Malaysia. A company incorporated in Labuan is one that is governed by this act, and not the  Malaysia Companies Act 1965.
 
The main sections included in the aforementioned Labuan law for companies are the following:
 
  1. Part III: the constitution of companies, including incorporation and status and name;
  2. Part IV: shares, debentures and changes – for example, the manner in which shares can be issued for a Labuan company and how the company capital can be changed;
  3. Part V: management and administration, including details about the registered office and name, the directors and officers, company meetings and proceedings, the register of members and the annual return;
  4. Part VI: accounts and audit, including information on the accounts that companies in Labuan need to keep and the manner in which the auditor is appointed or removed;
  5. Part VII: the manger in which a Labuan company can be reconstructed; included here are amalgamations and information about takeovers and mergers;
  6. Part VIII: foreign companies in Labuan; the registration of a foreign Labuan company and other information; a second part of the chapter includes information about the Labuan protected cell companies;
  7. Part IX: the Labuan law that applies in case of company winding up; the usual winding up process and the alternative procedure for voluntary winding up;
 
The final part of the Labuan Companies Act 1990, Part X Miscellaneous deals with issues such as the disposal of company shares in special situations (when the whereabouts of the shareholder are unknown), injunctions, irregularities in proceedings and others.
 
Investors should keep in mind that the following fees apply when opening a Labuan company, as per the data provided by the Labuan International Business and Financial Centre, the Labuan IBFC authorities.
 
  • - 15 USD: the application for the company name reservation;
  • - 300 USD: the fee when the paid-up capital of the company is RM50,000 and below;
  • - 2,000 USD: the registration fee for a foreign Labuan company;
  • - 800 USD: the annual fee for a Labuan company;
  • - 1,500 USD: the annual fee for a foreign Labuan company;
Please remember that these fees can be subject to change.
 

Other Acts of interest

 
The Labuan law includes a number of other relevant Acts that govern the manner in which local and foreign investors open and manage companies as well as trusts, foundations and partnerships.
 
As far as the provision of financial service is concerned, the following applicable Acts are worth mentioning:
 
  • - The Labuan Financial Services and Securities Act 2010: includes the Labuan financial services and securities regulations, including the documents that are filed with the authorities for obtaining a Labuan trust company license, the fees that are applicable and other details;
  • - The Labuan Islamic Financial Services and Securities Act 2010: the conditions for a Labuan trust company that need to be fulfilled in order for the business to be registered as a Labuan Islamic trust.
 
The Labuan Trusts Act 1996, and most notably the Labuan Trusts Regulations 2010 include information on the general requirements for trusts and the documents that are required upon their formation. Investors who are interested not in company formation but in the incorporation of a limited partnership refer to the Labuan Limited Partnerships and Limited Liability Partnerships Regulations 2010 (a document that includes information not only on the registration of these business forms but also the payable fees and the manner in which a recognized limited liability partnership can be liquidated).
 
For more information on the Labuan law for companies, please contact our local company formation experts. We can answer any questions about the governing laws, recent changes and important yearly updates for companies.

 

Meet us in Labuan


Call us now at +6018 7777 938 to set up an appointment with our business consultants in Labuan. Alternatively you can incorporate your company without traveling to Labuan.

As our client, you will benefit from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Labuan.

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