A Complete Guide To Types Of Business Licences In Malaysia

Businesses cannot legally begin operating in Malaysia until they have all necessary licenses, and depending on industry, this ranges from ‘piece of cake’ to ‘shouting matches with government officials’.

In this guide, we cover the types of business licenses in Malaysia and their corresponding regulatory bodies. At the end, we explain why you should consider outsourcing this headache to someone else!

Let’s begin.

General licenses

General licences are needed by businesses that intend to operate from commercial premises and are issued by the Local Authorities (known locally as Pihak Berkuasa Tempatan or PBT). These government bodies manage all businesses that operate within their jurisdiction, so be ready to play by their rules. 

1. Premise license

A premise licence acknowledges that a business premises is safe and complies with health and safety regulations. This licence is required for businesses that operate from commercial premises, such as retail shops, mall kiosks, restaurants, and offices.

2. Signboard license

A signboard licence acknowledges a business’ signboard complies with requirements by local authorities, and is required for businesses that display signage, such as shop front signs, billboards, and advertising signs.

3. Composite license

This licence combines the requirements for both premise and signboard licences into a single composite licence for a more convenient application process. 

Businesses must submit an application with supporting documents, and authorities then conduct an inspection of the premises and signboard to ensure all necessary requirements have been met. While it varies between jurisdictions, it can take up to 30 working days from the date of application submission to receive the composite licence

The licence itself is typically valid for one year, and may be renewed for another 12 months upon renewal application.

Note: Some local authorities prorate the application based on the calendar year instead. This means it expires on 31 December regardless of when it is granted, though you are only charged for the number of months the licence is active.

Industry-specific Licenses

These are licenses required to operate in certain specific industries and are meant to ensure a business complies with specific regulations and requirements. Unlike general licences, these are issued by relevant federal government agencies that oversee a particular industry.

Here are several common sectors with industry-specific licences and their respective government bodies:

Construction:

• Contractor’s licence: Construction Industry Development Board Malaysia (CIDB)
• Certificate of Competency for Crane Operation: Department of Occupational Safety and Health (DOSH)

Healthcare:

• Medical Practitioners licence: Malaysian Medical Council (MMC)
• Pharmaceutical licence: National Pharmaceutical Regulatory Agency (NPRA), Ministry of Health (MOH)
• Private Hospital licence: Private Healthcare Facilities and Services Act (PHFSA), MOH

Education:

• Private Higher Education Institution (IPTS) licence: Ministry of Higher Education (MOHE)
• Private School license: Ministry of Education (MOE)

 Now, let’s look at the last category.

Activity-specific licenses

These licences cover specific activities or businesses that could pose a risk to public health, safety, or welfare. Like industry-specific licences, these are issued by regulatory bodies that regulate the activities.

Oftentimes, businesses must prove they deserve to be granted activity-specific licences by sending staff for specific training and education, achieving certain health and safety standards, and enforcing strict compliance with environmental regulations.

Here’s a list of some activity-specific licences and their corresponding industries:

• food business licence; food and beverage industry
• tourist guide licence; tourism industry
• private security industry licence; security industry
• real estate agent licence; real estate industry
• cosmetics notification; health and beauty industry
• scheduled waste management licence; environmental industry

Again, we’re not going to provide the full list, but as a rule, If poor management of your business operations might kill people, make them seriously ill, or affect their long-term wellbeing, you’ll probably need an activity-specific licence.

Required documents

As a general rule ensure the following documents are ready:

• business or company registration documents
• land tax receipt
• Certificate of Occupancy
• rent agreement (if renting a business premises)
• coloured sketch of the business premises sign design
• exterior and interior photos of the premises
• Dewan Bahasa & Pustaka signboard approval
• additional supporting documents may be required from agencies such as:
  • Fire & Rescue support letter
  • Occupational Safety & Health
  • Health Department
  • Veterinary Services Department

Some business licenses also need other business licenses as part of the required supporting documents, so be sure to check for the correct order! As a general rule, you should obtain industry-specific licenses first, activity-specific licenses second, and general composite licenses last.

Hiring business license runners

Often shortened to just ‘runners’, these are individuals or companies that assist with the application process and navigating the various requirements and regulations. Having interacted with hundreds of businesses, here’s a consideration for new entrepreneurs: You get what you pay for.

Individual runners may charge less, but the eventual cost to the business owner is often much higher. Hire them and prepare to face the following problems: 

• extra charges from printing, courier and travel fees without consistent documentation
• expect to do 100% of the research yourself on how to meet the various requirements
• sometimes, all a runner helps obtain is a temporary license which is valid for a short period
• with nothing to hold them accountable, private runners can, and do, simply vanish after getting paid

In contrast, companies like MISHU charge more initially, but provide the following benefits:

• no hidden charges, everything has been built into the initial quote
• expert guidance on how to meet all necessary requirements to obtain permanent licenses
• we handle all paperwork
• with a physical office and registration number, we are liable to deliver what we promise

Of course, so long as it is an informed decision, it’s ultimately up to the business owner which to go with, or even if they would prefer to directly handle the application process, though we obviously advise against it. Whichever way you believe can get you your business licences the fastest is the best way.

Let MISHU handle your business license applications

Our team of business license consultants are here to help you navigate licensing application and renewal requirements so you can start operating as soon as possible. Speak to us today!