Privileges of Sdn Bhd ownership in Malaysia

 

Definition of a Sdn Bhd Company

A Sendirian Berhad (Sdn Bhd) company is a private limited company which may be established in Malaysia. It is one of several business entities which exist there alongside sole proprietorships and partnerships. The Sdn Bhd company is the only company type in Malaysia which is allowed to be established by foreigners. Foreigners are allowed to completely own a Sdn Bhd company based in Malaysia. A Sdn Bhd company in Malaysia is to have between two and 50 shareholders; however, none of its shares are to be issued to any unauthorized member of the public.

It should be noted that there are certain industries in which complete foreign ownership of a Malaysia-based Sdn Bhd business is not allowed. These industries are tourism, banking, oil and gas, agriculture, and education.

Privileges of Sdn Bhd Ownership in Malaysia

Ownership of a Sdn Bhd company in Malaysia provides its owner with a great many benefits with regard to legal and financial matters. For this reason, many people who start a company in Malaysia choose to start a Sdn Bhd company. One of the main privileges of ownership of a Sdn Bhd company is that of the limited liability principle which protects the personal wealth of business owners. This principle provides financial security to Sdn Bhd owners because Sdn Bhd companies’ liabilities are limited. None of the owners of the company stand to lose any money except for the amount of capital which they had already invested in the company. Therefore, the owners of a Sdn Bhd are protected from severe financial losses.

It is relatively simple to transfer the ownership of a Sdn Bhd company. A Sdn Bhd shareholder in Malaysia is legally permitted to either sell or transfer shares to any person of the choice of the shareholder as long as the person who is to receive the shares is able to afford them. Sdn Bhd companies also benefit from an increased supply of capital. These companies can easily raise capital through either the issuance of either bonds or equity certificates. By doing so, the growth of Sdn Bhd companies can be accelerated. Furthermore, Sdn Bhd companies do not have to spend excessive amounts of money in order to be able to be established in a suitable location. It can often be expensive to establish a company in certain locations in Malaysia. However, it is relatively simple for a Sdn Bhd business owner to select a location where overall costs are generally reduced.

A Sdn Bhd company is defined as a separate legal entity. Due to the fact that the company is a separate legal entity, all financial losses suffered by the company do not cause significant negative consequences to befall the company owner because the operations of Sdn Bhd companies will last until the disbanding of the company. A Sdn Bhd is also granted permission to sign contracts, acquire assets, and file lawsuits against people or entities.

Sdn Bhd companies of Malaysia are generally well-regarded. Most business groups and leaders in Malaysia consider Sdn Bhd companies to be flexible and open. They are also to always be compliant with the strict reporting requirements which are enforced in Malaysia. Sdn Bhd companies are also often granted the right to borrow money from banks at lower interest rates. Such is the case because in Malaysia, loans which are intended for Sdn Bhd companies are often used for the purposes of business expansion or other business activities instead of any illicit or illegal activities.

When one considers all of the advantages and privileges which are available to Sdn Bhd owners, perhaps you might begin to consider ownership of such a company. We at Paul Hype Page & Co will enable such to be true for you. We will guide you through the process of incorporating a Sdn Bhd company in Malaysia. If necessary, we will also help you hire nominee directors or company secretaries for a reasonable fee.