Set Up And Wind Up A Foreign Limited Liability Partnership In Malaysia.

With the depreciation of Ringgit Malaysia against another currency, now the foreigner who is intended to conduct a business in Malaysia becomes more affordable and they are eligible to register a foreign Limited Liability Partnership (a Foreign LLP). Why registered a foreign LLP? How the mechanism operated? Let us explore further.

What is a foreign LLP?

Foreign LLP is a business entity combine both the conventional partnership and a limited liability company. Setting up a foreign LLP requires a minimum 2 partners, and appointed a local compliance officer. The appointment of local compliance officer is to maintenance a local register office and correspondence with both the Companies Commission of Malaysia (CCM) and Inland Revenue Board (IRB).

Why select to register a foreign LLP?

The foreigner who invested in Malaysia market may encounter a variety of risk factors, such as currency risk, credit risk, financial risk, by registered a foreign LLP, it may reduce the such as above risk to a minimum. Besides that the foreign LLP could hold the local asset such as property, motor vehicle rather that by a foreigner.

How to set up a foreign LLP?

Step 1 : reserve a foreign LLP name

The compliance officer would assist the foreigner to reserve a name with the registrar by to fill up a Form 1 and pay RM30.00 to CCM. After the name approve, the name reserve for a 30 days for register.

Step 2 : register a Foreign LLP

Upon reserving the foreign LLP’s name, now the compliance officer could register a foreign LLP by completing Form 4 and pay RM500.00 to CCM, with the following particulars :

i) The principal business activity and firm name,

ii) The register office and address,

iii) The partner and compliance officer's name and particulars,

iv) The partnership agreement detail.

In additional that the compliance officer has to furnish the certified copy of the certificate of registration and a certified copy of the charter.

How to maintenance the foreign LLP?

The foreign LLP should submit a Form 15 which is an Annual Declaration within 30 days of the anniversary of its registration, or any other period the Registration allows. The purpose of Annual Declaration is to declare by partners that are financially capable to settle their liabilities toward the creditor when it fall due.

What is the consequence if the foreign entity dissolves?

The compliance officer shall, within 1 month after the dissolution, lodge a notice of dissolved from a foreign entity and appoint a liquidator to wind up the foreign LLP.

How to cease the foreign LLP?

The compliance officer shall, within 7 days lodge a resolution of cessation to the registrar. After the expiration of 6 months from the date of the lodgement, the Registrar shall remove the registration of foreign LLP.

The Conclusion

The global revolution of business without exists of a boundary and territory between the nation. Hence, by liberation of international trade will encourage and promote the sharing of the economy and growth.