Different types of companies in Malaysia

What is the Sdn Bhd company in Malaysia? The types of Malaysian companies can be divided into the following categories:

• Sole proprietorship
• Partnership
• Limited Liability Partnership, also known as LLP
• Private Limited Company, commonly known as Sdn Bhd’s
• Public Limited Company, known locally as Berhad’s
• Companies limited by guarantee
• Foreign companies

Sole proprietorship:

The type of single-owner business entity is one of the simplest and cheapest ways to form business entities. A Malaysian company that is registered as a sole proprietorship must only pay an annual fee to the Malaysian Business Commission to keep the business renewed every year. Sole proprietorship do not need to present audits or make annual presentations for the business.

Partnership:

A company of a Malaysian company operates similarly to the concept of sole proprietor. The only thing that differentiates the two entities is that the association agreement involves more than one owner, hence the name of the association.

Limited Liability Partnership, also known as LLP:

The LLP business entity is a combination of a limited liability company and a public limited company. The advantage of LLP is that it is a corporate body and a legal entity separate from its partners. The LLP would also have perpetual successions and have fewer compliance requirements, which makes the LLP a more affordable business model.

Private Limited Company, commonly known as Sdn Bhd’s:

What is the Sdn Bhd company in Malaysia? These types of commercial entities are very commonly known in Malaysia as Sdn Bhd's. It is the most common type of business entity in Malaysia because it has a separate legal identity and can acquire assets, borrow, sign contracts, be sued or be sued and have a perpetual succession until the directors and shareholders decide to dissolve the company. A private corporation is also a much more credible business entity. Private corporations in Malaysia are the preferred commercial structure, especially when it comes to conducting B2B business.

Public Limited Company, known locally as Berhad’s:

The difference between this type of business entity and private corporations is that the corporation can offer its shares to the public. This type of business entity generally involves the publicly traded company and is governed by the Malaysian Securities Commission. Corporations are usually the preferred business model for large companies.

Companies limited by guarantee:

This commercial entity implies that the responsibility of the members is limited to the amount that the members have assumed or guaranteed to contribute. This commercial entity is commonly used by nonprofit organizations, such as foundations and charities.

Foreign companies:

A commercial entity of a foreign company in Malaysia is equivalent to a foreign branch in Malaysia. The branch would generally be registered as an extension of the parent company and is not a separate legal entity.