• Setting Up a Restaurant in MY

If you’re looking to start a business in the Malaysian F&B industry, this guide serves a menu of business licenses for restaurants! There are plenty of licenses that you will need to apply for to get your restaurant operations going – here are the procedures required to do so!

Signboard License

A Signboard is akin to an Identity Card that an individual has. It represents a restaurant’s identity, akin to how an identity card identifies a unique individual.

Under Malaysia Law, this is compulsory to have for all types of businesses in Malaysia. Having no Signboard is practically same as being an “illegal immigrant”, it is mandatory to have it or else it is a punishable offence.

A signboard license is typically valid for 1 year upon approval/renewal. You can choose to renew the license every year by paying the renewal fee.

Procedures:

  • Fill up an application form (borang permohonan), attached with it is the design of your signboard. Take note that your signboard is required to have the following:

    1. Nature of your business must be clearly stated in Bahasa Malaysia
    2. Company Name
    3. Business License Number
    4. Ensure there is no visuals related to alcohol, cigarettes or indecent photographs
  • Submit the Required Documents (See checklist below)
  • Pay the application fee
  • Wait for approval on the signboard design and the signboard license

Checklist

Name of Documents
SSM documents – this can be obtained via your company secretary
Tenancy Agreement / Sale and Purchase Agreement of your Business Premise
Certified True Copy of your identity card and/or passport photo
Office Layout Plan
Photograph of your business premise
Certificate of Completion and Compliance / Certificate of License
Photograph of the location intended to place the signboard
Signboard Visual – includes signboard size, physical measurement and design

Liquor License

If you are planning to sell alcohol in your restaurant, it is mandatory under law to apply for a Liquor License. You will require a Liquor License no matter what form of liquor/alcohol, be it Hard liquor or even a regular can beer.

Given that Malaysia is made up of a majority of Muslims, it is a taboo for them to consume alcohol. Therefore, the Liquor License is heavily emphasized by the government to ensure that only authorized establishments are selling alcohol.

There are two different Liquor Licenses: the Public House License and the Beer House License. The difference between the two is that holders of Public House License are allowed to engage in the retail sale of liquor, which Beer House License is for consumption within the premise.

If you are a restaurant owner, a Beer House License will be more appropriate for you.

Procedures:

  • Fill up an application form
  • Submit the required documents (see checklist below)
  • Pay application fee
  • Wait for approval from your respective Town Council

Checklist

Name of Documents
SSM documents – this can be obtained via your company secretary
Tenancy Agreement / Sale and Purchase Agreement of your Business Premise
Certified True Copy of your identity card and/or passport photo
Photograph of your business premise

Halal License

A stunning fact is this – 61.3% of Malaysia practices Islam. That makes close to 20 million Individuals eating Halal certified meals.

JAKIM Malaysia Halal Food Certification | Download Scientific DiagramHowever, you cannot simply just call your products “Halal”. You will be required to apply for a Halal License, certified by Jabatan Kemajuan Islam Malaysia (JAKIM). Only upon this certification will you be a certified Halal restaurant.

To ascertain what exactly constitutes “Halal”, here is a guide by JAKIM:

  • Does not stem from or consists of any part of or item from animals that are forbidden to Muslims by Islamic law, or animals that have not been slaughtered according to Islamic law.
  • Does not contain any substance that is considered impure in Islamic law.
  • Is not prepared, processed or manufactured using equipment or utensils that are not free from impurities as defined by Islamic law
  • That, in the preparation, processing or storage stage, does not come in contact with or is stored near any kind of food that does not meet the requirements of para(s) (a), (b) or (c) or any substances that are considered impure by Islamic law.

As a business owner in Malaysia not looking to sell Pork or Alcohol related products, attaining a Halal License will be a wise choice to make. See below for what is required to be submitted to attain this crucial license.

Procedures:

  • Fill in the relevant forms related to:

    • Product/Consumer Goods
    • Food Premise
    • Slaughter House
  • Submit the Required documents and relevant certificates (see checklist below)
  • There will be internal Auditors coming to verify your application. An application can take anywhere from 6 to 24 months.

Checklist

Name of Documents
SSM documents – this can be obtained via your company secretary
Name and Description of product/menu for certification
Ingredients used, including the name and address of your supplier
Type of packaging material
Other documents such as HACCP, ISO, GHP, GMP, TQM, etc
Location map of Business Premise

If you intend to play music in your restaurant, this violates the “personal use” portion as it is now being used in a commercial setting. It is thus now illegal to play it without a music consensus or license.

This is where the Music Authors’ Copyright Protection Berhad License (MACP) comes into play. You will need to apply for the MACP License in such a context.

Procedures:

  • Submit your application to MACP

  • Attach required documents (see checklist below)
  • Make Payment – there are 4 categories provided in detail with differing payments
CategoryPrice
Pub, bar, beer garden, bistro, lounge, resto bar*Mechanical Music:

First 50 person – RM 1,500, each additional person RM 15

**Featured & Live Music:

First 50 person – RM 2,800, each additional person RM 28

Restaurant, café, coffee house*Mechanical Music:

First 50 person – RM 800, each additional person RM 8

**Featured & Live Music:

First 50 person – RM 1,300, each additional person RM 13

Food court, canteen*Mechanical Music:

First 50 person – RM 700, each additional person RM 7

**Featured & Live Music:

First 50 person – RM 1,000, each additional person RM 10

Budget eatery outletFlat Rate RM300

*Definition of Mechanical Music: refers to performance of music by the use of any form of recordings (including digital format), CD, DVD, tape player, radio and television and includes from, and copied onto digital devices such as tablets and smartphones where the music is provided for background only.

**Definition of Featured Music: refers to performance of music by DJ and includes music provided for the purpose of accompanying singing by patrons (karaoke) besides the use of any form of recordings (including digital format), CD, DVD, tape player, radio and television and includes from, and copied onto digital devices such as tablets and smartphones.

**Definition of Live Music: refers to performance of music by live artiste performers including singers, bands, musicians, dancers, models and conductors.

  • Acquire the License

Checklist

Name of Documents
Company Business Registration and/or premises license issued by respective local council
Total seating capacity
Company/ Business Registration Number

Public Performance Malaysia License

The Public Performance Malaysia License (PPM) is a specific license to get, as an added on from the MACP. For restaurants with live bands, this is for you!

There are restaurants out there with live bands as part of what attracts your customer base. In cases like this, live bands fall under the purview of the PPM

Procedures:

  • Fill in the application form
  • Attach required documents (see checklist below)
  • Make payment – there are 4 categories provided with differing payments
CategoryPrice
Discotheque/Nightclub/Karaoke/Lounge/ Pub/Bistro/Other Multi Entertainment/ Restaurant (With Pub or Bar Facility)Price ranging from RM 3,000 to RM 27,000
Lounge/Pub/Bistro/Restaurant (With Pub or Bar Facility)Non-Featured Entertainment

First 50 persons RM 1,200, Every additional person RM 10

Surcharge

Each monitor RM 400, Each video wall/multiple screen RM 1,000

Eatery Outlet/Coffee House/Cafe/Cyber Cafe/ Food Court/Gaming Centre/Fast Food Joint/ Canteen/Community Singing CentreNon-Featured Entertainment

First 100 persons RM 600 Every additional person RM 2

Surcharge

Each monitor RM 200, Each video wall/multiple screen RM 1,000, Each stand-alone karaoke RM 1,000

Traditional Coffee ShopNon-Featured Entertainment

First TV/Audio Player RM 300

Surcharge

Each monitor RM 100, Each video wall/multiple screen RM 1,000, Each stand-alone karaoke RM 1,000

  • Submit the application form to PPM

Checklist

Name of Documents
SSM documents – this can be obtained via your company secretary
Premises Name for all outlets
Details of Music/Sound Service Provider

Food Establishment Licensing

As with every company, opening a food establishment requires you to set up a company first.

Ramu
TIP: Engage an incorporation partner to handle the paperwork for you for a higher success incorporation rate.

Food Handling License

All food handlers are required to go through a Food Handling course conducted by an approved training school by the Ministry of Health.

This course includes those in the food processing, food service/hospitality and food retail sectors. Restaurant owners, you are included as well.

The purpose of this course is to create a food safety culture in Malaysia. Failure to attend this course will see a fine of not more than RM 10,000 or not more than 2 years of imprisonment.

Procedures:

  • Find a training school approved by the Ministry of Health
  • Upon completion, for the certificate to be given to you, you must also fulfil the local regulatory criteria.
Ramu
NOTE: This certificate will be valid for life.

Composite License

A license that is not often considered but often needed, is the composite license. This license stipulates where you place and dispose your waste at. All you need to do is to fill in the online application form on eLESEN.

Wholesale and Retail Trade License

Applied to the Ministry of Domestic Trade and Consumer Affairs (KPDNKK), the Wholesale and Retail Trade License (WRT) is one of the most common licenses required by a foreigner who wishes to conduct business in wholesale and retail trade in Malaysia.

The WRT is a requirement for the application of an Employment Pass in Malaysia. As such, this licensing is very important to acquire. The WRT License is mainly given to 4 categories of trades in Malaysia, namely:

  • Retail and Trading
  • Franchise
  • Services and Consultancy
  • Restaurants

Procedures:

The general process of acquiring a WRT License can be summarised below:

1) You must have a registered SDN BHD company, with the appropriate minimum paid up capital

EquityPaid-up Capital
100% Local OwnedRM 250,000
Joint Venture (minimum foreign equity is 30%)RM 350,000
100% Foreign OwnedRM 500,000
Foreign owned companies running Wholesale, Retail and Trade (WRT) Licence is compulsory. (Refer to the Ministry of Domestic Trade, Cooperatives and Consumerism WRT licence application guideline)RM 1,000,000

2) You must have your own office space

3) You must have your own staff employed or the director has to be present during site inspections

4) Provide us with the documents required (see checklist below)

5) After all the conditions are satisfied, we will then submit your application to the relevant government organisation

Checklist

Name of Documents
Comprehensive Company profile and Business Plan
Copy of IRB’s tax registration confirmation letter
Tenancy Agreement / Sale and Purchase Agreement of your Business Premise
Photo of the premises
Product list with pricing
Photo of product/services offered
List of expatriate details

What’s Next

Starting a restaurant in Malaysia is the same to starting any business. It can get exciting, it can get tough but it is your own project. We cannot help you in determining how it will go out, but we can determine how it will begin, which is by settling the fundamentals right.

Ready to incorporate a company in Malaysia? Reach out to us for a free consultation and see how we can be part of your entrepreneurial journey!

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FAQs

Can I open a company in Malaysia as a foreigner?2021-10-02T11:32:40+08:00

Yes, you can incorporate a company in Malaysia even though you are a foreigner. You can check how to do it here.

Are foreigners who open a Restaurant in Malaysia subject to additional Regulations?2020-04-28T16:51:53+08:00

Foreigners who are planning to set up a restaurant in Malaysia have to introduce something unique yet relatable to the cuisines of the people living in Malaysia. The restaurant business provides 100% ownership to foreigners, making it a lucrative business opportunity. Many foreign restaurants owners are relatively established in the country. The first step to be taken is the registration of the restaurant in Malaysia. The following are the relevant requirements:

  • Selection of business type: as a foreigner, the only choices available are those of registering as a Sdn Bhd or a private limited company. 
  • The foreigners need to obtain the following licenses depending on what they sell in the restaurant: 
  • Halal certification if the restaurant is Muslim-friendly 
  • Alcohol license if alcohol is being sold in the restaurant 
  • Import License for imported ingredients 
  • MACP and PPM licenses for restaurant owners who want entertainment options in their restaurant 
  • Wholesale and Retail Trade licenseOne point worth noting is that this license is only given if the restaurant serves ethnic food such as French or Middle Eastern cuisine and has a minimum space of nearly 140 square meters. 

The location of the restaurant should have high traffic, easy access, and visibility from a distance.

The owner must take note of the modern food trends of Malaysia and opt for the menu according to the target market so as to attract more customers and earn revenue. Foreign restaurant owners can also acquire the DP10 visa that grants them a two-year  work permit for their family and themselves.

What difficulties might prospective Restaurant owners in Malaysia face?2020-04-28T16:50:41+08:00

Most of the businesses in the service sector in Malaysia operate manually. This includes restaurants as well. Newly opened restaurants have a cash-based system; only a few award-winning restaurants have modern cashless systems installed with other technical reservation systems that can also be used.

New restaurant owners may have to face tough competition from these high-end restaurants until and unless they have something unique to offer. However, those who choose to install an advanced cashless system or reservation system for seats in the restaurant through mobile apps can expect a great many customers who opt to dine in the restaurant.

Several other new restaurant owners may face the problem of location or even deciding on the menu The incorporation of the business or obtaining of the licenses may also become a major issue in many situations. If the restaurant owners are not using the services of any professional agency, then getting an excellent hiring staff in any city of Malaysia can also become difficult. Dedicated and ethical professionals play a significant role in the success of the restaurant. New restaurant owners must carefully select opening hours of their restaurant to match consumers’ convenience and to make profits.

Is anyone allowed to sell food which they have made themselves?2020-04-28T16:47:19+08:00

Restaurants which serve home-cooked food is already making rounds amongst the Malaysians as they offer distinct delicacies. They also allow people living away from their home to experience truly authentic dishes. Most of the business owners and apps provide online platforms to connect consumers with home cooks. These apps or platforms are highly recommended for the people who plan to try home-cooked food and do not have time to go out or have grown tired of eating the same food all the time. Most of the home cooks also provide healthy options to the people that are interested in this market.

Home-based cooks must cater to food standards set up by the Malaysian government. People using these apps must render accurate information to make their accounts legitimate. Many apps offer a platform to restaurants to sell their cuisines online, and many companies are working on apps that can help home-based cooks to become part of this thriving industry. These apps help people sell and buy food; many locals have bought authentic delicacies at a reasonable price by using these apps.

Regarding the lega requirements of these home-based cooks, the Companies Commission of Malaysia requires all online food operators to register their business. The move was taken to protect consumer rights and to save them from buying counterfeit products. Authorities can and will carry out routine inspections to check the quality of the food being sold. It is also essential to maintain the hygiene of the place of operation so as to get the required license.

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2 Discussions

  1. Ravi Ranjan Kumar September 4, 2019 at 5:30 pm - Reply

    Warm Greetings!
    We, my wife and I run a Yoga Company in Bangalore, India for the past 8 years and would now like to spread Yoga and explore more opportunities in another country. Hence, we would like to set up a Yoga Company in Malaysia.
    We would be grateful if you could help us with some information about setting up our Yoga Company in Malaysia and resident permit,Work permit.
    Please do let us know if we would require to submit any additional information and we would be glad to do so.
    Thank you
    Warm regards
    Ravi Ranjan Kumar

    • Tiwiyah Kumaran September 5, 2019 at 11:56 am

      Hello Ravi,

      If you are interested in expanding your company to Malaysia, you will need to register with SSM for incorporation purposes.
      Several different work permits are available in Malaysia; these include the Employment Pass and Professional Visit Pass, among others. Select one according to the needs of your company.
      For further information, contact us at Paul Hype Page & Co so that we can assist you with regard to company incorporation and work permits in Malaysia.

      Thank you.
      Paul

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