It was only a few years ago that this Federal Malaysian territory caught the eyes of the forex industry. Now numerous brokers have started to take an interest in getting a Labuan Money Broking Forex license. Moderately low capital demands, passage to quality, local banking, and a fast application procedure are just a few causes more brokers are counting a Labuan FX license.

Overview

Incorporation & obtaining license: Depends on the license type

Minimum paid-up capital: 92500 Pound (unaffected by losses) or its equivalent in any foreign money (we urge to have approx. 100950,00 Pound as a paid-up capital)

Labuan is an island and fall under Federal Territory of Malaysia. It is inhabited in the South China Sea at the northwest shore of Borneo, north of Brunei and south of Kota Kinabalu, the capital of the state of Sabah.

For several business services, Labuan Malaysia extends one of the effective regulatory frameworks and taxes in Labuan are relatively low (3%).

For beginning money broking business in Labuan, it is asked to obtain a license from Labuan Financial Service Authority (FSA).

There are 3 choices for launching money brokerage company in Labuan:

  • have an organized Labuan company in Labuan
  • receive local money broker license
  • by confirmation of Bank Negara Malaysia (The Central Bank of Malaysia) operate as the authorized organization in accordance with Banking Financial Institutions Act 1989

In order to qualify and keep the license, it is essential prior to appeal for a license to have a great track record of business performance and it is needed to initiate a functional operation of the company in Labuan.

N.B.

The money broking license allows the brokers to allow only Straight-through processing (STP) trading, but nonetheless, it offers with the opportunity for easier obtaining of a bank account.

Notable features

Company Name

  • Language: Any
  • Letters: From the Roman alphabet
  • Names that are misleading or tricky are banned
  • If the Malaysian word Berhad is utilized then it needs to be introduced by “(L)” to denote that the organization is incorporated in Labuan.
  • The company name is restricted to be alike or similar that of an existing company
  • Offensive names are prohibited
Procedure

In order to get a license, the following actions will be carried out:

  • Gathering reports in an agreed form
  • Drafting of the fund’s offering record
  • Development of application forms
  • Introduction of the license obtaining process
  • Following up and observing your submission until Regulator permission
  • The application will be made with the LFSA for the license
  • Provisional permission will be provided by LFSA so that you will have sufficient time (usually 3 months) to:
  • Meet the capital terms (500 000.00 RM) for the organization. After the capital is invested, you can use the funds for the company’s operator:
  1. find and set-up an office,
  2. apply for the phone number,
  3. find a local representative,
  4. Comply with other requests.
  • Before the acquisition of a license from the LFSA, it is expected to pay the yearly fee of RM 5000 for renewal of the license
Document

In order to receive a license, Startup Formations will fill all important paper forms and also obtain following corporate documents.

For bank:

(All beneficial owner, stockholder, administrator, authorized signatory)

  • A notarized photocopy of original passport
  • A copy of proof of residential address
  • A notarized proof of Letter of Recommendation form Bank, Solicitor or Accountant

For local regulatory authority:

(All beneficial owner, stockholder, administrator, authorized signatory)

  • CV
  • A notarized photocopy of original passport
  • A copy of proof of residential address
  • Two Acknowledged letters from a notary, attorney, auditor or related,
  • Bank recommendation
  • A notarized copy of a University Diploma
  • For shareholder: 3 months bank record with adequate funds to cover the capital demands
  • All documentation shall be provided in English*
  • * If records are not in English, then they must be brought by a notarized translation.