Factsheet
Labuan company factsheet
A Labuan company is governed by the Labuan Companies Act 1990, regulated by Labuan FSA, can be incorporated in three business days, and is taxed at 3%, 0% or 24% depending on its activity and whether it meets economic substance requirements.
This is our standing reference on the corporate and regulatory features of a Labuan company. We maintain it against each amendment to the governing legislation.
Labuan is one of Malaysia's three federal territories, located off the north-east coast of Borneo. The territory consists of seven small islands, of which Labuan Island is the largest. The population is approximately 100,000, mostly bilingual — Malay is the national language, but English is the main language of business. Labuan sits at the heart of ASEAN and is reachable by direct flight from Kuala Lumpur, Kota Kinabalu and Miri, and by sea from Brunei.
Important features of a Labuan company
| Governing law | Labuan Companies Act 1990 |
|---|---|
| Main legislation | 1. Labuan Companies Act 1990 · 2. Labuan Business Activity Tax Act 1990 and its amendments · 3. Labuan Financial Services and Securities Act 2010 |
| Regulator | Labuan Financial Services Authority — the statutory body responsible for regulating and supervising international business and financial services in Labuan |
| Business activity types | Trading, and non-trading (investment activities) |
| Permitted activities | Any business lawful in Malaysia carried on in, from or through Labuan. May conduct business with residents of Malaysia and transact in Ringgit Malaysia |
| Taxation — trading | 3% of net audited profit, for companies listed under the Schedule |
| Taxation — non-trading | 0% |
| Taxation — non-compliance with ESR | Flat 24% |
| Royalty and IP income | Taxed under Malaysia's domestic Income Tax Act 1967, not under LBATA |
| Tax identification | All Labuan companies receive a TIN |
| Tax returns | Employer tax return and company tax return both required |
| Sales and Services Tax | Applicable if business is transacted with residents |
| Economic substance | Yes, depending on the business activity carried on |
| Licensing | Banking, insurance, trust companies, leasing, fund management and other financial services require a licence from Labuan FSA |
| Registered agent / office | Required |
| Registered office address | Mandatory, in Labuan |
| Company secretary | Resident secretary is mandatory |
| Incorporation time | Minimum 3 business days |
| Labuan FSA fees | First-year capital registration USD 300 for paid-up capital not exceeding RM50,000. An annual fee of USD 1,000 is also payable |
| Minimum capital | 1 share |
| Currency of capital | Any currency, including Ringgit Malaysia |
| Bearer shares | Not permitted |
| Shareholders | Minimum 1; corporate shareholder allowed |
| Directors | Minimum 1. If a corporate director is appointed, the composition must include at least two directors with at least one natural person designated as resident director |
| Public records | No — however a third party may now search at the Registry provided written consent from a director is obtained |
| Location of meetings | Anywhere |
| Common seal | Yes |
| Company accounts | Yes |
| Audited accounts | Required |
| E-invoicing | Applicable, subject to annual turnover and exemption criteria |
| Annual return | Yes |
| Change in domicile | Yes |
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The primary documents this page relies on, linked to the authority that issued them. If one has moved, tell us and we will correct it.
- Acts administered by Labuan FSA — including the Labuan Companies Act 1990, the Labuan Business Activity Tax Act 1990 and the Labuan Financial Services and Securities Act 2010 (opens in a new tab)
Labuan FSA · Legislation
Every feature in the table above is set by one of these Acts.
- Labuan companies — Labuan FSA overview of the structure (opens in a new tab)
Labuan FSA · Regulator
- Guidelines for Labuan companies (opens in a new tab)
Labuan FSA · Guideline
Last reviewed 4 August 2026
Whilst considerable care has been taken to ensure the information contained within this page is accurate and up to date, no warranty is given as to the accuracy or completeness of any information and no liability is accepted for any errors or omissions in such information. The information given in this page is based on our present understanding of the current laws, guidelines and regulations and may therefore be subject to change without notice.
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