Equity policy in manufacturing

Malaysia is keen to welcome investment in the country’s manufacturing sector, and in order to increase local participation in the industry, the Government encourages Malaysian investors to open joint ventures with foreign investors.

Equity Policy for New, Expansion or Diversification Projects

As of June 2003, foreign investors can hold 100% equity in all new projects and expansion/diversification project investments in existing companies, with no export level, product or activity restrictions.

The shareholding policy is also applicable:

Existing licensed companies that were previously exempted from applying for a Manufacturing Production License but now have a shareholders’ fund of RM2.5 million or have employed 75 or more full-time employees and are therefore required to apply for a license.

Existing licensed companies that were previously exempted from the equity condition but now have a shareholders’ fund of RM2.5 million and are therefore required to comply with the condition.

Equity policy applicable to existing companies

Equity and export conditions imposed on companies prior to June 17, 2003, will remain unchanged, but companies may request that they be removed, which will be granted by the authorities on a case-by-case basis, depending on the value of the case.