Manufacturing

(1) Who are the authorities regulating the manufacturing industry in Malaysia?

The authority regulating the manufacturing industry in Malaysia is the Ministry of International Trade and Industry (“MITI”) and MIDA, an agency under the purview of MITI, which is in charge of the promotion and coordination of industrial development in Malaysia.

(2) Who are required to apply for a manufacturing licence in Malaysia?

Manufacturing companies with shareholders’ funds of RM2.5 million and above or engaging 75 or more full-time paid employees are required to have a manufacturing license issued by the MITI. Applications for manufacturing licenses are to be submitted to MIDA.

(3) Is there any foreign equity restriction for the manufacturing industry in Malaysia?

Currently there are no general restriction against foreign equity ownership in the manufacturing industry in Malaysia save for certain activities that are of national and security interests. Since 17 June 2003, Malaysia has liberalised the manufacturing industry and foreign investors can hold 100% equity in all investments in new manufacturing projects, as well as investments in expansion/diversification projects by existing companies. Equity and export conditions imposed on companies prior to the liberalisation process undertaken in June 2003, however, remain effective. Companies can apply to MITI / MIDA for these conditions to be removed and approval will be given based on the merits of each case.

(4) Are there any investment incentives for manufacturing industry in Malaysia?

Yes. There are various incentives offered by the Malaysian government for the investors who invest in the manufacturing industry in Malaysia. Please click on MIDA FAQ to find out more about investment incentives in Malaysia.