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 Private limited companies can also be used for strategic purposes as joint ventures and the management of holding and subsidiary company relations. Exempt private companies, which are those companied owned by not less than twenty individuals’ according to the Companies Act would be exempted from filing for financial statements with CCM after getting a certificate that confirms the company is an exempt private company. Nevertheless, they must still compile reports of financial statements on an annual basis for internal books.

 In addition, the private company may change to registration as a public company and conversely on passing of a special resolution and after filling in notice indicating the conversion from PDT ‘RBEB’ to CBSA ‘BESA’ with Companies Commission of Malaysia.

 A public limited liability company in Bahasa Malaysia is referred to as ‘Berhad’ which is often abbreviated as Bhd placed after its name. Public limited companies may or may not be listed in the stock exchange but most of them go for listing so that they can enjoy all the features as a public entity, like accepting equity investments from the latter.

 It does not have any maximum limit for public limited company unlike private limited companies. Annual general meetings and annual reports, regarding their financial performance, are mandatory aspects for public limited companies. As public companies, they are required to meet higher accountability and listing standards regulated by the Companies Commission of Malaysia and the Malaysian Securities Commission.

 Public Limited Company is mandated to require at least 2 directors who typically live in Malaysia with a dominantly resident address. Some of the well-known public limited companies include major banks, telecommunication companies, construction firms property development companies and many more are listed on the stock exchange.

 A Company Limited by Guarantee (CLBG) as discussed previously is one form of a limited company and the word ‘Berhad’ or its abbreviation ‘Bhd’ appears in most CLBG names although this derivative can be left off by having an application submitted for it to be omitted.

 CLBGs are widely used for non-profit organizations, such as charities, community projects, clubs and societies etc. No sharing of profits or dividends to the company’s members.

 CLBGs are different from other company types in that they cannot be endowed with a share capital and must have a company constitution following incorporation. This document sets the important specifics such as the company’s limited guarantee position, its objects powers and liabilities, rights and privileges of officers, as well as a proposed number of members.

 It should be noted that there is the provision in the Companies Act which prohibits unincorporated associations and therefore, any charity organization consisting of more than 20 people must be registered with the CCM.

 Some examples of CLBGs are usually groups where organizations’ names often consist of terms such as Foundation (Yayasan), Institute (Institut), Academy (Akademi), Corporation (Badan), Alliance, Fund, Centre and many others.

 As the name suggests, an unlimited company does not provide the limited liability opportunity for its members or shareholders. As a result, the members or shareholders are liable for all the losses of the company. It should be noted that unlimited companies are rarely used in Malaysia. In spite of this unique liability framework, all other costs and considerations associated with starting up the company and running its operations are similar to that for limited companies.

 The option of converting to a limited liability company may also be exercised by an unlimited company. This can be done through a special resolution and the filing of notice of conversion with the Companies Commission of Malaysia.

 Foreign companies, as the name implies, are corporate entities incorporated outside of Malaysia. These companies have two options for incorporation or registration within Malaysia.

 A foreign company which registers as a foreign branch office on the other hand will not be treated as a distinct legal entity under the provisions of Companies Act since they are just an arm of their parent companies and so they have not been incorporated afresh. It is also expensive in establishing a foreign branch where registration fees for SSM are exorbitant that ranges from the minimum of RM 5,000 to RM70, 000 depending on the share capital employed by the foreign company. Branch offices are, however popular with international companies which want to start off short term operations in Malaysia. Otherwise, we would nearly always be better off setting up a local subsidiary company.

 One cannot just cook good food and start a restaurant in Malaysia; there are several business licenses that one requires for legal operation. Apart from the usual obligatory permits, you will require additional licenses depending on your clientele and the atmosphere that you want to create. As a general rule, attached cost increase with the increased level of an upscale and sophisticated restaurant concept.

 The article provides a brief summary of the compulsory licenses and commonly optional licenses that are necessary for opening an F&B outlet in Malaysia. In this section, as we discuss each license, sections to be covered will include the amount of time taken to get a license, issuing authority and any relevant best practices or considerations. It should be noted that it is assumed you have registered an SSM enterprise or Sdn Bhd, since these registration documents are required when one wants to apply for business licenses.

 Do not worry if you do not know how to register, read on and at the end of it is a link to prepare your incorporation. Furthermore, whereas cost of licenses issued by the federal bodies would be indicated; those that are locally based are priced under utilities as decided upon Local Authorities and, on account of numerous nature in some scenarios it is also not feasible to this rolled individually curred out.

 A Premise and Signboard License is mandatory for every restaurant in Malaysia. The validity of the license is usually for one year and is issued by Local Authorities

 On top of the mandatory license, business owners may need to apply for Halal Certification, Liquor Licenses, Wholesale, Retail, and Trade Licenses and Music and Performance Licenses

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 Music Authors’ Copyright Protection Berhad License (MACP) is a mandatory license for restaurants that play copyrighted music. MACP determines the price of the licensing fee based on the type and size of the eatery. The application process for obtaining the license involves filling out a form and submitting necessary documentation.

 These licenses are given by the Local Authorities, or Pihak Berkuasa Tempatan (PBT), that manage your district. All these licenses jointly certify that your premises conform to the relevant health and safety requirements and verify that your signboard provides a truthful representation of what you do.

 It should be noted that different Local Authorities such as MBP, DBKL, and other may have stipulated unique requirement which includes safety standards , pests control measures ,customer amenity facilities and even the premises location besides design layout of interior. For example, certain municipalities require the use of alternative floor materials depending on whether the space is air-conditioned or not.

 Your best action is either to carry out a premises inspection, seek advice from a business adviser, notify the relevant Local Authority or consult an official check list available online.

 However, please be assured that the Local Authorities will take about 2-4 weeks from date of application to deliver both your premise and signboard license. Usually, such licenses are issued for 12 months from the issuance date and may be renewed for another one-year period after filing an application request therefor.

 In some cases, certain local jurisdictions use a prorated application method that is calendar-year based. It means that despite being issued not later than on December 31, the license expires also on this date, and the fee is estimated for only those months, during which it remains in force.

 Speaking about the price, differences are observed not only by jurisdiction in different states but also they depend on the place where you have a restaurant and its size.

 Speaking about the price, differences are observed not only by jurisdiction in different states but also they depend on the place where you have a restaurant and its size.

 The official guidelines by DBKL (Dewan Bandaraya Kuala Lumpur) can be found at this page, however it is worth to mention that the content is in Bahasa Melayu. Furthermore, these directives apply specifically to businesses within DBKL’s jurisdiction.

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