Human Resource

Having helped hundreds of foreigners set up ventures all over Malaysia from Kuala Lumpur to Johor Bahru, the MISHU team can happily confirm that yes, Chinese national can register and operate private limited companies in Malaysia.

In fact, Malaysia is not just a possible location but a preferred one!

In fact, the actual company registration requirements f0r Chinese nationals are the same as any other nationality including Malaysians!

However, setting up a business involves more than incorporation. There are additional regulatory, licensing, and operational requirements that apply to foreign entrepreneurs in general and Chinese national in particular, and this guide covers what to expect.

Here’s how we’ve broken it down:

• a brief introduction to Malaysia’s version of a private company
• general company registration requirements
• additional challenges faced by foreigners, and
• specific challenges for China nationals

Let’s begin.

Malaysia’s version of a foreign-owned private company

As you know, foreign investors in China choose between a Wholly Foreign-Owned Enterprise (WFOE) or a Sino-Foreign Joint Venture (JV).

The equivalent entity for those investors in Malaysia is known as a Sendirian Berhad (Sdn Bhd) and can exist as a 100% foreign-owned limited liability company or a joint-venture with a local.

For existing businesses in China, a Sdn Bhd is the equivalent of setting up a foreign-owned subsidiary in Malaysia, granting the parent liability protection from your Malaysian operation.

ALLIANCE STEEL Sdn Bhd is fully owned by China’s Guangxi Beibu Gulf Iron and Steel Investment Co Ltd.

Like all private limited companies, key features are:

• profits given corporate tax treatment (16-24%)
• ownership through shareholding
• separate legal entity status, and
• limited liability protection for owners and directors

There is a second option known as a foreign branch office, which is a direct extension of a business incorporated outside Malaysia.  In this case, the foreign parent company has more control over its Malaysian operations but is fully liable for its debts and obligations.

For an in-depth comparison, read our subsidiary vs branch office guide, and we exclusively refer to Sdn Bhds from this point onwards!

Sdn Bhd registration requirements

There are five main requirements to register a company in Malaysia:

• paid-up capital of at least RM2,500 / USD600
• a unique name not in use
• one shareholder
• one locally residing director
• registered Malaysian address

Upon incorporation, you will also need to appoint a licensed Company Secretary within 30 days to act as your compliance officer.

Both the shareholder and director can be the same person and a foreigner, it’s just that the director must reside in Malaysia (and prove this by having a Malaysian residential address).

Challenges for 100% foreign owned businesses

There are two main challenges foreigners without a Malaysian partner must solve.

WRT / USS license paid-up capital

Foreign-owned businesses engaging in any form of trade or service-based business must obtain a Wholesale, Retail & Trade (WRT) or Unregulated Services Sector (USS) license from the Malaysian Ministry of Domestic Trade.

At minimum, this requires the business in question to have at least RM1 million in paid-up capital, and potentially more for certain high-value trade sectors.

Locally resident director

As a foreign owned companies often don’t have local connections, they will either have to:

1. Appoint a nominee director, or
2. Apply for a Category 1 Employment Pass for a foreign director to move to Malaysia

The first option is cheaper and faster but carries a higher amount of risk, while the second option increases is safer but significantly longer.

For starters, foreign-owned businesses must have at least RM500,000 in paid-up capital to apply for Employment Passes, but since the business must already have RM1 million in paid-up capital for their WRT/USS license, this is mostly a non-issue.

You’ll need separate applications for each foreign team member coming to Malaysia.

The main consideration is that Category 1 EPs require positions to be paid at least RM10,000/month and an update in June 2026 will see this threshold increased to RM20,000 per month.

Additionally, the company will have to register for an employer account with the Malaysian Immigration’s Expatriates Services Division and go through the EP application process which can easily add three to four months to the wait time before it can begin operating legally.

And now we get to specific requirements for China citizens.

Additional requirements for Chinese nationals

In addition to the above, Chinese nationals should be prepared for two additional considerations.

Stricter KYC (Know Your Customer) procedures

Due to limited availability of publicly verifiable data, Chinese applicants are often subject to additional verification from company registration providers like us, namely proof of credit standing to confirm no bankruptcy history and a Notarial Certificate of No Criminal Record issued in China to ensure the business is of good standing.

2. Security bond for Employment Pass

Unlike most nationalities that only submit a personal bond, Chinese nationals are required to provide a Security Bond, and Bank Guarantee when applying for any work visa. These are more comprehensive but serve the same purpose of insuring against breaching visa conditions and as a promise of good conduct.

Yes, that’s really it! As you can see, the main challenges faced as a China national are the same challenges faced by any foreigner!

That’s it from us, and we wish you all the best with expanding into Malaysia.

Let MISHU handle your WRT license application

If you are a foreigner looking to set up a restaurant in Malaysia, consider our professional WRT license application services for a one-stop solution for company incorporation, visa applications, and full licensing support.