Business Licensing in Malaysia
These information pages can help you get started in learning about some of the laws and registration requirements that may apply to your experiences on Airbnb. These pages include summaries of some of the rules that may apply to different sorts of activities, and contain links to government resources that you may find helpful.
Please understand that these information pages are not comprehensive, and are not legal advice. If you are unsure about how local laws or this information may apply to you or your Experience, we encourage you to check with official sources or seek legal advice.
Please note that we don’t update this information in real time, so you should confirm that the laws or procedures have not changed recently.*
Could I be a business? When am I likely to be considered to be carrying on a business?
In Malaysia, you are generally considered to be carrying on a business if you carry out any form of trade, commerce, craftsmanship, calling, profession, or other activity carried on for remuneration. Presently, there are no express laws which designate what degree of “doing business” is required before you are deemed to be doing business in Malaysia. However, you will generally be considered as carrying on business so long as you derive income from the selling of goods or provision of services for example, professional or vocational services (e.g. chef, driver, instructor, tour guide).
Are there any registration requirements for businesses in Malaysia?
Yes. You will be required to register your business with the Companies Commission of Malaysia (“CCM”) before carrying on business in Malaysia. There is potential criminal liability (such as financial penalties and/or imprisonment) for carrying on business under a business name without being registered in respect of that name.
Additionally, failure to register may also render contractual agreements unenforceable. There are certain exceptions to this requirement such as:
- when you are a sole proprietor carrying on a business under only your full name in your identity card or passport (e.g. Mr Tan Ah Teck must register if he does business under "Tan Ah Teck Adventures" but not if he does business under “Tan Ah Teck”);
- if the business is a firm of 2 or more individuals carrying on business only in the full name of all the individuals; or
- you are carrying on business in the name of a company or entity that has already been registered with CCM.
You are able to register as a business in various vehicles, such as:
- sole proprietorships;
- limited liability partnerships;
- company limited by shares;
- company limited by guarantee; or
- an unlimited company.
A name search will have to be conducted to confirm that there is no business with an identical name. You should also be aware that if the proposed name is a trade mark of any product, the written consent of the owner of the trade mark owner will be required before that mark can be registered as a business name. Subsequently, an application form and a fee would have to be submitted to the CCM.
You can find out more information about registering your business on the CCM Website.
What if I am a business - Is there anything I need to be aware of when dealing with consumers?
Consumer protection laws, such as the Consumer Protection Act 1998 and Consumer Protection (Electronic Trade Transactions) Regulations 2012 require you to accurately describe your Trip or Experience in your listing so your guests can make informed decisions.
This means that:
- the information you provide to guests should be clear and not misleading. You should not represent that the Trip or Experience contains features that you do not intend to provide;
- you should accurately disclose your identity, registration number of the business, if applicable, and provide the relevant contact details;
- you should accurately and completely describe in your Trip or Experience description the main characteristics of your Trip or Experience, as well as what is included (for example, my favourite local craft cocktail bar Experience includes the first round of drinks, but guests must pay for additional drinks out of pocket);
- you should also accurately disclose any special terms and conditions and must ensure that these terms are not unfair to the guest;
- your up-front price should be in full and accurate, and you should not list a Trip or Experience at one price and then charge an additional fee when your guests get there. This means no hidden charges;
- you should also specify the method of payment (for example, if there are any fees that need to be made upfront or during the course of the Experience);
- material information likely to influence consumers’ decision such as price and other sales conditions should be disclosed and not hidden in small print; and
- you should not represent that your Trip or Experience is available at a discounted price for a stated period of time if you know that it will continue for a substantially longer time.
In summary, it means that any information provided to the potential guests must be true, accurate and not misleading. You must not attempt to manipulate or deceive your guests into booking an Experience with you if you know that is untrue or that you are unable to fulfil it.
It would be a good idea to consult your lawyer regarding the full extent and responsibility as a goods/service provider on a consumer market under Malaysian Law. You should be aware that there is potential criminal liability for failing to adhere to consumer protection laws which may result in financial penalties and/or imprisonment.
Is there anything else I should think about?
Activities and Licences
If your Experience will involve other activities (for example, serving/providing food or alcohol or providing transportation or guiding tours), please take a look at our other information pages to work out if any other rules might apply to your activity. Our information pages on the various activity specific topics cover some of the typical activities, but it is not exhaustive. You should always check with the relevant authorities or speak to a lawyer to determine which registrations, reports, or licenses may be required for the Experiences you are offering.
Tax and accounting
You should also check what are the tax and accounting rules applicable to the type of business entity you have chosen. In order to comply with such rules, you will have to keep proper records and accounts of your Trips or Experiences related activities so that the authorities may ascertain the taxable income and expenses arising from such activities and to declare your income to the Inland Revenue Board. If you expect the revenue of your business to have a total value of taxable supplies at any month and the immediately preceding 11 months to exceed RM500,000, you will be required to register with the Royal Malaysian Customs Department as a Goods and Service Tax-registered person.
It would be a good idea to check that you have the appropriate insurance coverage in place to cover all the activities you will be providing.
If you plan to hire employees as part of your business, you will have to consider amongst others the obligations imposed under the Employment Act 1955 and other legal requirements pertaining to employment such as statutory contributions (Employment Provident Fund, Social Security Organisation, Employment Insurance Scheme), workplace safety and health issues and work permits/employment passes for any foreign workers.
If you are unsure as to whether your Experience would trigger any of the above requirements, it would be a good idea to reach out to the relevant regulators/bodies or speak to your lawyer to make sure you are following the laws.
*Airbnb is not responsible for the reliability or correctness of the information contained in any links to third party sites (including any links to legislation and regulations).
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