fbpx
business needing WRT license example

The Foreign Entrepreneur’s Guide to WRT Licenses in Malaysia

Introduction

Wholesale, Retail, and Trade (WRT) licenses are issued by the Malaysian Ministry of Domestic Trade, locally known as Kementerian Perdagangan Dalam Negeri (KPDN) for foreign-owned businesses in Malaysia operating within distributive trade businesses.

This guide covers important aspects of WRT licenses that entrepreneurs need to know, including:

  1. The objectives of WRT licenses
  2. Types of businesses requiring WRT Licenses
  3. General and specific requirements
  4. Required documents
  5. The application process, including general time and cost estimates

Key Takeaways:

  • WRT licenses exist to promote the economic and technological growth of Malaysian industry while protecting local businesses from foreign competition and monopolies.
  • The application period will take 1 – 2 months, and upon approval, the license is valid for a period of 2 years.
  • Because WRT licenses mostly apply to foreign-owned businesses, a company with at least 51% Malaysian ownership could be exempted from WRT license application.
  • There are additional requirements and documents needed for F&B outlets that want to apply for a WRT license.
  • WRT licenses are a total headache – hire us to do it for you instead!

The objectives of WRT licenses

While we understand the motives behind laws doesn’t really interest people, as a foreign business owner, knowing the ‘why’ behind WRT licenses can provide a more intuitive understanding of how to navigate the application process.

keep government happy to get WRT license malaysia
Never hurts to know where to scratch.

In other words, when you know the government’s expectations, it becomes easier to meet them and get your license – so here they are:

1. Elevating Malaysian industry
The aim is to create a conducive environment that encourages healthy competition among industry players while preventing monopolistic market practices.

2. Encouraging modernisation
The requirements underpinning WRT licenses encourage the thoughtful use of technology for streamlined workflows, logistics and resource usage.

3. Balancing foreign and local participation
The purpose of regulating foreign participation is, like it or not, to protect local businesses and entrepreneurs from being outcompeted.

You can therefore infer that you stand a better chance of obtaining a WRT license if your foreign-owned business can add value to Malaysian industry while posing little to no threat to local enterprises. If you were thinking of flying to Malaysia to put some beloved old lady’s noodle stall out of business, you should probably buy a return ticket.

Types of businesses that need a WRT license

KPDN defines distributive trade as follows:

‘…trade which comprises all linkage activities that channel goods and services from the supply chains to intermediaries for the purpose of resale or to the final buyers’.

In plain English, if your business is involved in getting products and services to consumers, there’s a good chance it falls under distributive trade.

Those interested can check out this official document which goes into more detail, but for the purposes of this guide, it’s enough to know that the most common businesses that fall under this definition include:

  1. F&B outlets
  2. Consultancies
  3. Retail stores of various sizes (hypermarkets, department stores, etc)
  4. Franchise outlets

General requirements for WRT licenses

No matter the industry, the business applying for a WRT license must be incorporated in compliance with the Company Act 2016. This includes a director who is at least 18 years old and living in Malaysia, as well as at least one local shareholder with 50% ownership (depending on specific business).

Additionally, the foreign-owned business must have a minimum paid-up capital of RM1,000,000.

Aside from that, the business must have already received approval from the local authorities to operate and registered with the various bodies that oversee tax and payroll obligations. Just a heads up, you’ll be asked to show proof of this.

Specific requirements for F&B outlets

Alongside general requirements, restaurants need to provide the following information:

  • a full menu
  • photos of the premises / products
  • documents certifying the chef’s or employee’s qualification and experience, and

Note that this is in addition to industry-specific requirements F&B outlets must meet.

Required documents (warning: long)

You can download an official checklist of the required documents on KPDN’s website, but for your convenience (trust us, it’s not the most legible document), here’s what you’ll need to prepare.

Mandatory documents:

  • Completed WRT 1 form.
  • Company profile / Business Plan
  • Certified copies of the Registration of Company and Form 49
  • Stamped copies of Form 32A, if there have been changes in shareholding
  • Inland Revenue Board:
    1. Copy of IRB’s tax registration confirmation letter for newly operating companies
    2. Copy of IRB’s confirmation of submission e-C for companies already in operation
  • Employee Provident Fund:
    1. Proof of registration for new companies.
    2. Latest 3 months EPF statement for existing companies.

Additional documents:

  • Copy of valid license by the Local Authorities
  • Copy of tenancy / sale & purchase agreement for the premises
  • Singed copies of the latest 3 years audited financial statements
  • (If applicable) Copies of licenses from relevant authorities
  • Copies of documents for 3 transactions per month over the last 3 months
  • Information on foreign workers / expatriates
  • Colour photographs of the premises / warehouse / office
  • Product catalog / sample

We originally planned to elaborate a little on each document, but our fingers no longer work after listing them out. Instead, we’ll add links where relevant and if you would like further help with any item on the list, please get in touch with our team and we’d be happy to help!

The WRT license application process

Once you have all the necessary documents, the application process is straightforward enough.

  1. go to BLESS, Malaysia’s online business license application portal
  2. sign up for an account
  3. select the license you’d like to apply for
  4. fill up and submit your license application
  5. pay the required fee

The application period will take 1 – 2 months, and upon approval, the license is valid for a period of 2 years.

A possible exemption method

A common question we get from entrepreneurs: What if I don’t have the RM1,000,000 in paid up capital required for a foreign-owned business?

Well, one method is to make your business locally-owned instead.

a strategy to be exempt from WRT license malaysia
Would you look at that – a loophole.

Because WRT licenses mostly apply to foreign-owned businesses, a company with at least 51% Malaysian ownership could be exempted from WRT license application. This also frees you from having to meet the higher paid-up capital requirements. However, this is no guarantee, and it often comes down to the discretion of the officer assigned to your case.

MISHU can assist with WRT license needs

CTA for Malay site Ayu min

If you’re looking to secure a WRT license, consider engaging our team to do it on your behalf. With our expertise and experience in assisting entrepreneurs from various industries, we can expedite the application process and save you valuable time and frustration.

Government officials just melt at our smile – it’s a real thing!

FAQs about WRT licenses in Malaysia:

  • What is a Wholesale Retail Trade (WRT) license in Malaysia?
    💡A WRT license allows a foreign-owned company to engage in distributive trade services in Malaysia. It is applicable to companies with more than 50% of their total shares owned by non-Malaysians and is awarded by The Ministry of Domestic Trade.

  • What main distributive trades must apply for a WRT license?
    💡The most common businesses that fall under this definition include F&B outlets, consultancies, retail outlets (hypermarkets, department stores, etc), and franchisees

  • What is the purpose of a WRT license in Malaysia?
    💡In short, to promote the economic and technological growth of the Malaysian industry while protecting local businesses from foreign competition and monopolies.

  • What are the standard requirements of a WRT license?
    💡The business applying for a WRT license must be incorporated in compliance with the Company Act 2016, have RM1,000,000 in paid-up capital, and already have prior approval from Local Authorities.

  • What are the required documents for a WRT license application?
    💡The full list of documents needed can be found on this page by clicking here.
Powered by MISHU AI
Maya

Hello, I am Maya, your AI assistant. I have been trained to answer any questions about our services to make things easier and faster for you. Feel free to ask me anything!

Dont worry, for peace of mind, a human colleague will follow up after our chat to confirm important details and offer further assistance.

Let's get started. How can I help you today?

Leave a Reply

Your email address will not be published. Required fields are marked *

Scroll to top