Labuan factoring is defined as the business of acquiring debts to any person or institution at a discount or such other business as approved by Labuan FSA.
The submission should include the following:
- The nature of business of the applicant
- The composition of its board of directors and senior management (prior written approval from Labuan FSA must be obtained for any appointment of director, controller or chief executive officer, who must be fit and proper persons).
- A business plan detailing the operations and strategies of the applicant.
- Audited financial statements for the last two years, if applicable; and
- Any other information that may be relevant to the application.
The applicant company:
- has an option to either set up an office in Labuan or operate through its registered office. However all transactions must be done through Labuan and adequate and proper records and books of accounts must be maintained in Labuan
- must maintain capital sufficient to manage the company's daily operations
- must transact business only in foreign currency and not deal in Malaysian Ringgit except for the purpose of defraying administrative and statutory expenses
- is prohibited from dealing with Malaysian residents other than those approved by Bank Negara Malaysia
- must conduct its business with due diligence and sound principles and comply with the local laws and regulations where it services its clients
- is to indicate clearly its name on its letterhead, stationery and other documents
- must appoint an auditor
- is to submit to Labuan FSA within three months after the close of each financial year, one copy of its audited annual balance sheet and profit and loss account
- is to provide statistics and information as required by Labuan FSA in relation to prudential information, general business conduct and volume and direction of business in Labuan
- must notify Labuan FSA of any change to its constituent documents, shareholdings, management or business plan; and
- must comply with any other requirements issued by Labuan FSA from time to time.
All licensees are required to pay to Labuan FSA annual licence fees on or before 15 January of each year:
Annual Fee RM40,000 @ USD13,000
- Labuan Financial Services and Securities Act 2010
- Labuan Companies Act 1990
- Labuan Business Activity Tax Act 1990