Incorporation of Companies

Related topics: | Secretary Adv | Secretary's Powers | Share Capital

How to incorporate a company?

Why buy a shelf company?

How to buy a shelf company?

Government Bodies

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How to incorporate a company?

Choose a name for your intended company and search with the Registrar of Companies whether the intended name is available. All company names shall end with a Sdn. Bhd. which means private limited company in Malaysia.

When the intended company's name is approved by the Registrar of Companies, you shall apply for the reservation of name. The reservation period given is 3 months.

Thereafter, you shall file your memorandum and articles of association of the company and Form 48A (Statutory declaration by a person before appointment as director, or by a promoter before incorporation of corporation) and Form 6 (Statutory declaration of compliance)

You shall also file Form 24 (Return of allotment), Form 44 (Notice of situation of registered office and of office hours and particulars of changes) and Form 49 (Return giving particulars in register of directors, managers and secretaries and changes of particulars)

The Companies Act in Malaysia requires a minimum of 2 shareholders and 2 directors and a minimum issued and paid share capital of RM2.00 for incorporation.

If you think the above procedures are too technical and cannot afford the time, you should engage a professional company secretary to assist you.

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Why buy a shelf company?

A shelf company is a ready made company, incorporated and registered with the Registrar of Companies. It complies with all the statutory requirements and is ready for sale.

The reason why many business people chooses to buy a shelf company is because they can acquire the ownership of the company and use it for business transactions immediately.

This is particular important if the business people needs to sign a contract, enter into a business transaction, made an order or issue an invoice, execute a legal agreement within the next day when business opportunity is available and has to be transacted after the negotiation.

You first have to select a company from the list of shelf companies available for sale. You may want to choose a name where you like very much because of it sound nice and has perceived meaning to you.

Once you have decided which shelf company you intend to acquire, the company secretary will transfer the subscriber's shares to your nominated subscribers and also to appoint your nominees to be the new directors.

Thereafter, you can open a bank account, print letterheads, name cards and start to transaction your business.

Government Bodies

If you want to find whether the proposed company that you intend to incorporate is already registered, search with the CCM as per the website below:

Companies Commission of Malaysia (CCM)


Methods of Conducting Business

Procedure for Incorporation

Registration for Foreign Companies



Methods of Conducting Business


In Malaysia, a business may be carried on in any one of the following forms:

  1. By an individual operating as a sole proprietorship

  2. By two or more (but not more than 20) persons in partnership

  3. By a locally incorporated company or by a foreign company registered under the provisions of the Companies Act 1965.

All sole proprietorships and partnerships must be registered with the Registrar of Businesses under the Registration of Businesses Ordinance 1956.


2.1.1 Company Structure

The Companies Act 1965 is the principal legislation governing companies in Malaysia. Under the Act , every company intending to carry on business in Malaysia must register with the Companies Commission of Malaysia (CCM) before conducting any business activity. The Act provides for three types of companies:

  1. A company limited by shares, where the personal liability of its members is limited to the par value of their shares, the number of shares taken or agreed to be taken by them.

  2. A company limited by guarantee, where the members guarantee to meet liability up to a nominated amount if the company is wound up to an amount nominated in the memorandum or articles of association in case the company is wound up.

  3. An unlimited company, where there is no limit to the members’ liability.

2.1.2 Company Limited by Shares

The most common company structure in Malaysia is a company limited by shares. Such limited companies may be either private (Sendirian Berhad or Sdn. Bhd.) or public (Berhad or Bhd.) companies.

Private Companies

A company having a share capital may be incorporated as a private company if its Memorandum or Articles of Association:

  1. restricts the right to transfer its shares;

  2. limits the number of its members to 50, excluding employees and some former employees;

  3. prohibits any invitation to the public to subscribe for its shares and debentures; and

  4. prohibits any invitation to the public to deposit money with the company.

Public Companies

A company can be formed as a public company or, alternatively, a company which is incorporated as a private company can be converted to a public company subject to Section 26 of the Companies Act 1965.

A public company cannot offer shares to the public unless a prospectus which complies with the requirements of the Companies Act has been registered with the ROC. The proposal for the issue or offer of shares to the public should first be submitted to the Securities Commission for approval before a prospectus can be accepted for registration.

A public company can apply to the Kuala Lumpur Stock Exchange (KLSE) for permission to have its shares quoted on the Exchange, subject to compliance with the requirements laid down by the KLSE. Any subsequent issue of securities (e.g. issue by way of a rights or bonus, or issue arising from an acquisition, etc.) requires the approval of the Securities Commission.



Procedure for Incorporation


The first step for incorporation of a company is to make an application to the ROC in the prescribed Form 13A with a payment of RM30.00 to determine if the proposed name of the intended company is available and, if so, the application could be approved and the proposed name would be reserved for the applicant for a period of three months. A proposed name which is of a kind which the Minister of Domestic Trade and Consumer Affairs has directed the Registrar not to accept for registration vide Gazette Notification No. 716 dated 30 January 1997 will not be approved, without his consent.

The following documents should be lodged with the ROC within three months from the date of approval by the ROC for the use of the proposed name:

  1. Memorandum and Articles of Association

  2. Statutory declaration of compliance (Form 6)

  3. Statutory declaration by a person before appointment as a director, or by a promoter before incorporation of a company (Form 48A)

The Memorandum of Association is the document stating the name, the objects, the amount of authorised capital (if any) with which the company proposes to be registered and the division thereof into shares of a fixed amount.

The Articles of Association describes the regulations governing the internal management of the affairs of the company and the conduct of its business.

On the issue of the certificate of incorporation, the subscribers to the Memorandum together with such other persons as may from time to time become members of the company shall be a body corporate, capable of exercising the functions of an incorporated company and of suing and being sued. It has a perpetual succession under common seal with power to hold land but with such liability on the part of the members to contribute to the assets of the company in the event of it being wound up, as is provided by the Act.


2.2.1 Requirements of a Locally Incorporated Company

A company must have a registered office in Malaysia at which all books and documents required under the provisions of the Act should be kept. 


The Secretary of a company must be a natural person of full age who has his principal or only place of residence in Malaysia. He must be a member of a prescribed body or is licensed by the Registrar of Companies, Malaysia.


The company shall have at least two directors who each has his principal or only place of residence within Malaysia. 


The company must appoint an approved company auditor to be the company auditor in Malaysia.



Registration for Foreign Companies


A foreign company desiring to establish a place of business or carry on business in Malaysia must apply for registration to the ROC. The application which can be filed at the Registry of Companies in Kuala Lumpur or through any of its branch offices in Malaysia, must be made in the prescribed Form 13A. 


When the approval has been obtained, such a branch must lodge with the ROC the following documents:

  1. a certified copy of its certificate of incorporation (or a document of similar effect)

  2. a certified copy of its charter statute on memorandum and articles or other instrument constituting or defining its constitution

  3. a list of its directors and certain statutory particulars regarding them (Form 77)

  4. where there are local directors, a memorandum stating the powers of those directors

  5. a memorandum of appointment or power of attorney authorising one or more persons resident in Malaysia to accept on behalf of the company, service of process and any notices required to be served on the company (Form 80)

  6. a statutory declaration in the prescribed form made by the agent of the company.

The appointed agent is answerable for the performance of all acts required to be done by the company under the Companies Act 1965. Any change in agents must be reported to the ROC.


Every foreign company shall, within one month after it establishes a place of business or commences to carry on business within Malaysia, lodge with the ROC for registration, notice of the situation of its registered office in Malaysia in the prescribed form.


A foreign incorporated company must file each year, within one month of its Annual General Meeting, a copy of the Annual Return and, within two months of its Annual General Meeting, a copy of the balance sheet of the head office, a duly audited statement of assets used in and liabilities arising out of its operations in Malaysia, and a duly audited profit and loss account.

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