TOPIC 4

BUSINESS
ENTITIES, RULES
& SUPPORTS
 At the end of this topic the students able to:

Understand the different business entity in

Malaysia
Learning
Outcome Understand the rule and regulation and
facilities required to set up and operate a
business entity

Identify the related business support

available in Malaysia
 4.1 Business organization in
Malaysia
4.2 Business Rule & Regulation
Outline 4.3 Business Support Facilities
4.1 Business organization in
Malaysia
4.1.1 Laws for Business Registration
Business Registration Act 1956 • Sole Proprietorship
(Amendment 1978) • Partnership
Procedures Of Business
Registration 1957

• Limited Company by Guarantee

• Limited Company by Share
• Private Limited Company (Sendirian
Berhad)
Company Act 1965 • Public Limited Company (Berhad)
• Foreign Owned Company
• Unlimited Company

Limited Liability Partnerships • Limited Liability of Partnership (LLP)

Act 2012
4.1.2 TYPES OF BUSINESS
ENTITIES

 Themost common forms of business entities registered

by small and medium enterprises (SMEs) are:
 a. Sole Proprietorship
 b. Partnership
 c. Private Limited Company
 a. Sole Proprietorship

 Law: Business Act 1956 (Amendment 1978).

 Ownership: one person
 Liability: Not a separate legal entity, unlimited liabilities at
personal capacity of business owner.
 Capital: Small
 Simple business structure.
 The name of the owner or any other name may be used.
 a. Sole Proprietorship (cont’d)
Advantages Disadvantages
Easy to manage, owner or proprietor can make Limited source of capital -> limit the business
decisions by himself/herself activity

Owner enjoys a certain degree of flexibility, react Unlimited liability. Owner bear debt responsibility
quickly and positively when needed. including using personal assets.

Easy to form and dissolve, minimum formalities Future development is limited, depends on the
management capability

All profits will go to the owner Owner is solely responsible for carrying out all the
tasks, more time and effort needed

Income tax based on his total individual income life span of the business = the age of the owner and
efficient management

Less subjected to government rules and The business will be dissolved if the owner passes
regulations. Financial statement to the Inland away. If someone wishes to continue the business, it
Revenue Board does not require validation by a will have to be re-registered.
qualified auditor
b. Partnership

 Laws: Business Act 1956 (Amendment 1978).

 Ownership: 2 to 20 person forms a partnership to carry out a business with a
view to making profits.
 Professional businesses (legal firms, architect and accounting firms) the
members could number up to 50 persons
 Liability: Not a separate legal entity, unlimited liabilities at personal capacity
of business owners.
 Partners carry out the business, share the capital, profits and losses
b. Partnership… cont’d
Advantages Disadvantages
Easy to set up with few formalities. Unlimited liabilities, may involve
personal assets of all partners
Easier to secure financial assistance from financial The life span of the partnership
institutions business depends on the life span of the
Increase equity through enlisting additional partners partners. If any of the partners passes
away or is declared a bankrupt, the
business is automatically dissolved,
Business risks can be reduced and distributed unless there is an agreement otherwise.
among partners, each partner will share the burden
and loses
The responsibility divided equally among partners If no Letter of Agreement is being
made, unethical or misconduct
behavior may happen.
A lot of ideas, talents and skills can be pooled Risk of personal clashes among
together for better management. partners
Income tax is not imposed on the partnership itself
but on the owners as individuals.
  The Business Registration Act 1956 does
Partnership
not specify that the formation of a
Agreement partnership business must be followed by
a written agreement between or among
partners. However, it is necessary for the
business to have some kind of Contract or
Partnership Agreement to avoid any
misunderstanding that may occur among
the partners
  Name of the business
 The duration of the partnership (to prevent the
dissolution of the business). The agreement should
also state that in the event one partner passes away
or withdraws from the partnership, the business
will not be dissolved.
Element of  Individuals involved in managing the partnership
Partnership business.
 The accounts of the business and share capital that
Agreement show the contribution of each partner and the right
and obligations of each partner towards the
capital.
 The properties are considered as assets of the
business.
  If partners do not have their own agreement, the
provisions of the Act will become applicable.
Sections 26 and 27 of the Act, among other things,
stipulate that the following must be provided for in
a partnership agreement:
 Profits or losses are to be shared equally.
 No interest is payable on a partner’s capital.
Partnership  Each partner is entitled to actively participate in the
Act 1961 
management of the business.
No partner is entitled to a salary for participating in
the partnership business.
 Partners have the right to be paid based on their
contribution to the business.
  Daily normal things in business can be decided by
the majority of the partners, but any changes that
regularly occur need to be made with consensus
from all partners.
 A partner may withdraw after getting the consent
of the other partners.
Partnership  The introduction of a new partner must have the
unanimous consent of all existing partners.
Act 1961  All business accounts books need to be kept at the
main business premises. Partners are allowed to
check through the books and they have the right to
keep a copy of the books.
 c. Private Limited Company

 Laws: Company Act 1965

 Membership: At least two members who are of Malaysian nationality, can act
as a director and founder, will appoint the Board of Directors who will
manage and run the business operation subject to the Companies Act 1965.
 Legal entity and its identity is separate from the identity of the company’s
members.
 Liability: The liabilities of the members in a company are limited to the total
shares contributed to the company’s capital. Personal assets are not affected
regardless of what happens to the company.
b. Private Limited Company

 Right and Responsibility: Can acquire assets under its own

name, take legal action and face legal action under its own
name.
 Life Span: Not dependent upon the death or resignation of its
members, can be dissolved when its members are no longer
interested in continuing the business.
 The number of members does not exceed 50
people;

It has specific authority to transfer ownership of

Terms &
members’ shares with the approval of the
company’s Board of Directors;

Conditions
of Private
A company is not allowed to offer or sell any
share or debenture to the general public;

Limited
Company
A company is not allowed to offer the general
public to deposit money within a stipulated time
frame; and

A company must use the word “Sdn. Bhd.” or

“Sendirian Berhad” at the end of its name.
Requirements Of A Private Limited
Company

 Memorandum of  Members of Shareholders

Association  Board of Directors
 Articles of Association  Company Secretary
 The Share Capital of a  Auditors
Company
 Registered Office
 Authorised capital (modal
dibenarkan)  Company Seal
 Paid-up capital (modal  Authorization Letter
berbayar)
b. Private Limited Company
Advantages Disadvantages

Funds are easy to acquire: exchange of share ownership or Company must pay corporate tax
loan

Shareholders are legally protected by law Company’s shares cannot be transacted

through the share market

Shareholders not burdened with the management, More rules and regulations, must abide by
responsibility to manage and run the business held by the the rules and fulfil the terms set by the
Board of Directors appointed by the shareholders. Companies Commission of Malaysia.

Liabilities of the company’s members are limited to the Qualified Auditors must audit yearly
capital contributes. Shareholders’ personal assets are not financial statement and must be complete
affected. and regularly updated

The life span of the business is not dependent upon the age Financial affairs of the company must be
or resignation of its members made transparent to the general

Greater potential for expansion Cost of setting up a company is high

Legally, the company is one business entity by itself

 Business Entity Summary
Business Law Business entity Liability Capital Taxes
entity contribution
registration
category
Registration Registration of – Sole Proprietorship Not a separate legal entity, Own / partner Personal
of Business Business Act – Partnership unlimited liabilities at contribution income tax
(ROB) 1956 personal capacity of
(only applicable business owners.
for West
Malaysia)

Registration Companies Act – Private Limited A separate legal entity with Share capital Corporate
of Company 2016 Company (Sdn Bhd) the company’s liabilities (except for tax
(ROC) – Company Limited by separated from the CLG) (except for
Guarantee (CLG) directors’ and CLG)
– Unlimited Company shareholders’.
(Sdn) (except for Sdn and CLG)
– Public Limited
Company (Bhd)
– Foreign Company

Limited Limited Liability – Limited Liability A combination of Partner Corporate

Liability of Partnerships Act Partnership (LLP) partnership and private contribution tax
Partnership 2012 limited company.
(LLP)
 4.1.3 Business Registration
Sole Proprietorship & Private Limited
Partnership Company
• Business Unit of the Companies • Must use the services of a company
Commission of Malaysia (CCM/SSM) secretary.
• A business is allowed up to seven days • Secretary will forward the form together
after the start of its operation to be with relevant documents to the
registered. Companies Commission of Malaysia in
• https://www.ssm.com.my/PublishingImag the state in which the operation will take
es/Pages/Legal_Framework/Guidelines/g
uidelines_for_registration_of_new_busin place.
ess_05062018_4.pdf • https://www.ssm.com.my/Pages/
Legal_Framework/Guidelines.aspx

Applications are turned down:

 Does not use capital letter in the form;
 Application form is too dirty or untidy;
 Corrections are made using liquid eraser;
 The business is already registered, but the owner has not taken any initiative to terminate the existing
business before applying to register a new one
4.1.4 Business Formation

• Starting From Scratch

1

• Buying Existing Business

2

• Family Business Succession

3

• Acquiring a Franchise
4
a. Starting From Scratch

 The most popular method among start-up entrepreneurs

 Entrepreneur has to make decisions on:
 Appropriate form of business
 Business or trade name
 Business and product/service image
 Suitable location of the business
 Appropriate funding to kick-start the business
 Proper business planning for everything that needs to be take into
consideration.
a. Starting From Scratch

Advantages Disadvantages
Free to make his/her own decisions A lot of efforts, requires more time, energy
and money in ensuring the business kick-
off
Opportunities to try and practice Higher chances of losses due to high
his/her own ideas project implementation cost
Free to choose suitable business Not able to accurately estimate sales, cost
location and premise, and acquiring and profit. (zero business history (i.e. sales
appropriate machine and equipment's record, costing and so on)
for the business
Free to develop business image and Usually has no track record, difficult for
personality that suits their desire and entrepreneurs to convince the financial
interest. institutions for financing
b. Buying An Existing Business

 Entrepreneurs start a new venture buy taking over an existing

business either buying the whole business or partial shares in the
existing business
 Entrepreneurs must “investigate” before buying. previous
owners have reasons why they wanted to sell their business. So,
it is the entrepreneurs’ responsibilities to “investigate” the
business that they want to buy as well the “background” of the
existing owners
b. Buying An Existing Business
Advantages Disadvantages
Start the business faster compared Requires bigger capital either to buy the whole
to starting a new venture form business or part of the business.
scratch

Probability of getting the financing Need a lot of efforts, money and time to
is greater with good track record improve the situation for not well managed
predecessor

Existing market and loyal Have to respect and abide the agreements
customers of existing business made by the previous owner with related
parties (i.e. suppliers, agencies etc.)

Established networking with Conflicts could arise between the new owner
suppliers, supporting agencies and and existing employees
communities.
c. Family Business Succession

 Entrepreneur is the successor of the business which was started by the

earlier family members (predecessors).
 Entrepreneur did not face the difficulties of starting-up a new venture.
 Generally, there are four levels of family business:
 Level 1: Business Inception (the founder)
 Level 2: Business Growth & Development (the founder & 1st generation)
 Level 3: Business Maturity (the founder,1st generation & 2nd generation)
 Level 4: Business Transition Period (1st generation, 2nd generation & 3rd
generation)
 Financing – debt financing versus equity
financing

Liquidity/Cash – family’s need for cash versus

business’s needs for cash

Challenges of Transition period – older generation versus new

generation (to let go or not to let go – ownership
Family & management power)

Business Succession - finding the right successor

(competent, motivated, and the most important
Succession getting consensus from all family members)

Emotion – family interest versus business interest

Rivalry – siblings, cousins

Family Business Succession… cont’d
Advantages Disadvantages
Freedom and flexibility in decision making. Unstructured early-stage business
organization

Pride of family culture, high commitment and Traditions practiced by older generation
motivation lead to business stability. passed on to new generation could lead to
resistance to change.

Family members willingness to “sacrifice” Family conflicts such as siblings and/or

their time and money (e.g. no salary taken for cousin rivalry.
1 st year of operation).

High possibility of achieving great monetary Nepotism (e.g. incompetent family member is
success due to high commitment. given a better management position).

Family members have good exposure to Early-stage limited financial resources.

business environment.

Difficulty in getting the right successor.

d. Acquiring A Franchise

 Another alternative of starting a new business

 A franchise is a product and/or service distribution system which is governed
by a contract
 Made between two parties namely, the franchisor and the franchisee
 The franchisor is a company which sells the right to another party to operate
the franchise.
 The franchisee is a person who purchases the right from the franchisor to
operate the franchise
 Operating a franchise includes selling and marketing the products and/or
services using the trade name and trade mark, as well as a set of systems
developed and owned by the franchisor.
d. Acquiring A Franchise… cont’d

 The right to operate the franchise granted by the franchisor to the franchisee
involves a few payments made by the franchisee agreed upon the signing of a
franchise. These fees are:
 Franchise Fee – one-off payment made by the franchisee to purchase the right to
operate the franchise
 Royalty - an on-going payment made by the franchisee to the franchisor based
on the percentage of sales as agreed upon the signing of franchise contract
(monthly or yearly)
 Advertising and Promotional Contribution - an on-going payment or
contribution made by the franchisee to franchisor’s advertising and promotional
fund.
d. Acquiring A Franchise… cont’d
• Franchisee acquires sale right (trade name, trademark and/or
Product/ product.
Tradename • Automotive, petrol kiosk, service station, soft beverages and
Franchise tire industries

• Franchisee acquires right to manufacture and market

franchisor's product, services, using complete business set up.
• Include intellectual properties (trade mark, etc.); marketing
Business strategies (pricing structure guideline, promotional activities
Format etc.), guided operational activities (franchisee is equipped
with operation manual and has to undergo a training),
Franchise premise settings and layout (exterior and interior layout;
ambience, colour scheme and decoration must in-line with
franchisor’s brand and image).
 Advantages of Franchising
To Franchisee To Franchisor
Lower business risks as franchisee shares The franchisor’s business expansion can be done
the business risks with the franchisor. through recruitment of new franchisees.

Better market acceptance of products The franchisor can put more focus on product
and/or services offered as they are research and development since business
established products and/or services of the expansion is done through franchise system
franchisor.
Benefits of economies of scales Lower business risks as franchisor shares the
business risks with the franchisees
Guidance by the franchisor’s management Benefits of economies of scales
team
Continuous support from the franchisor Problems related human resource management is
and government agencies that involved in reduced due to the fact that the franchisees have
the development franchise industry. to manage the human resource related matters
themselves.
Disadvantages of Franchising… cont’d
To Franchisee To Franchisor
Limited freedom and flexibility to manage Franchisee conformity; difficult to manage the
the business according to franchisees’ franchisees in ensuring the conformity in the
desire system due to the fact that they are not
franchisor’s employees.
The franchise right granted by the The franchisor/franchisee goal incompatibility;
franchisor has its price to pay; the different business objectives as well as personal
franchise fee, royalty and advertising & objectives that could jeopardize the business
promotional contribution “marriage”.
Limited product varieties; the franchisees “Wrong” franchisee; There are franchisees who
are allowed to market and sell only the want an “easy-ride” in an attempt to gain instant
franchisor’s products popularity for the business.
Fear of chain-reaction; bad reputation and Competition through imitation of business
tarnished image due to the fault of either concept and model
the franchisor or the franchisee would
affect the whole franchise system
4.2 Business Rule and Law
4.2.1 Business Rule and Law

Approval & License

• Required Licenses in business

Business Infrastructure
• Law and regulation in setting up business premise

Employment Policies and Legislation

• Employment rule and regulation
4.2.1 Business Rule and Law

Excise License and Sales Tax License

• Excise duties are require for a factory that manufactured goods which
prescribe under Excise Act, 1976.
• Excise license also need for products under this category and should
be obtained from Royal Customs Malaysia.
• Customs Department will levied a sales tax on imported and locally
manufactured goods.
• A sales tax license should be apply under Sales Tax Act, 1972
4.2.2 Approval & License

Manufacturing License
• The Industrial Coordination Act (ICA) 1975 requires person (s) engaging in any
manufacturing activity (making, altering, blending, ornamenting, finishing or any
other related activities) to obtain a license made to Malaysian Industrial
Development Authority (MIDA).
• Apply to the manufacturing companies with shareholders’ fund of 2.5m and above
or engaging 75 or more full-time employees.

No-Objection Letter for the Location of Projects

• No-objection letter from the respective State Government is require for approval
of the project location
• Submitted to MIDA for the issuance of the manufacturing licence .
4.2.2 Approval & License… cont’d

Approval for Planning Permission

• Require under Town and Country Planning Act, 1976 (Act 1972).
• Need for a development and use of all lands and building made to local
government (e.g: Kuantan City Council)

Approval for Building Plan

• The Street, Drainage and Building Act 1974 (Act 133) required construction
of buildings can only be undertaken with the written approval for the local
authority.
• Every plan, drawing or calculation in which related to the building must be
submitted by qualified person such as architect, draughtsman or engineer.
4.2.2 Approval & License… cont’d

Approval for Certificate of Fitness for Occupation

• All completed building need to be certified as being fit for occupation by
the local authority.
• This requirement has been spell out under the Uniform Building by Laws
1984

Approval for Business Related Licences

• The licences related to factory premises, advertising signage, storage and
canteen.
• This licences should be apply through the local authority
4.2.2 Approval & License… cont’d

Approval for Environmental Control

• Environment Quality Act, 1974 requires the manufacturers to control industrial activities that
may result in a new source of effluent or discharge
• The installation of incinerator, fuel burning equipment and chimney also need approval.
• The environmental control and approval are under the responsibility of Department of
Environment.

Approval for Safety and Health

• Factories and Machinery Act 1967 require manufacturers to obtain design approval of
certificate machinery and certificate of fitness
• The application of approval should be send to Department of Occupational Safety and
Health.
 1. Employment Act 1955

4.2.3 2. Employer Provident Fund

Employment
Policies &
Legislation 3. Social Security Organization

4. Occupational Safety And

Health
1. EMPLOYMENT ACT 1955

 Stipulates the minimum conditions of employment such as Besides, the Act is

to provide minimum standards on working hours and overtime, weekly rest
day, public holidays, annual and sick leaves, maternity benefits, termination
and lay off benefits etc
 Applies to all employees in Peninsular Malaysia and the Federal Territory of
Labuan whose monthly wages do not exceed RM1,500 and all manual
workers irrespective of their wages
 Employees who earn between RM1,500 to RM5,000 a month can still seek
redress from the Labor Department with regard to wages and any other
payments in cash as stipulated in their contract of service
2. Employer Provident Fund

 A social security institution formed according to the Laws of Malaysia, Employees Provident
Fund Act 1991 (Act 452), provides retirement benefits for members through management of their
savings
 All employers must register their employees with EPF immediately upon employment.
 Provides a convenient framework for employers to meet their statutory and moral obligations to
their employees.
 A contribution constitutes the amount of money credited to members' individual accounts in the
EPF. The current rate of contribution is 23% of the employee's wages of which 11% is from the
employee's monthly wage while 12% is contributed by the employer.
 All employers and employees except foreign workers, expatriates and those who are listed under
the First Schedule must contribute to the Employees provident Fund (EPF). However, they can
choose to contribute at the rate of RM5.00 (employer’s share) per employee per month and 11%
of monthly wages by the employee.
3. Social Security Organization

 Administers the Employment Injury Insurance Scheme and Invalidity Pension

Scheme provided under the Employees’ Social Security Act 1969.
 The scheme is compulsory and employer must cover all employees under
SOCSO even if they are covered under other insurance policies.
 A monthly contribution must be made for each eligible employee according to
rates specified under the Act (about 2.5% of basic employee’s salary).
 Covers only Malaysian workers and permanent residents. All establishments,
including factories, employing workers earning wages not exceeding
RM2,000 a month
4. Occupational Safety And Health

 The Department of Occupational Safety and Health (DOSH) is a department under the Ministry of
Human Resources. Responsible for enforcing compliance of the law with OSHA 1994. DOSH also
enforces compliance with the Factories and Machinery Act 1967.
 The OSHA 1994 provides legislative framework to promote, stimulate and encourage high
standards of safety and health at work.
 The aim is to promote safety and health awareness, establish effective safety organization and
performance through self-regulation schemes designed to suit the particular industry or
organization. This Act also defines the responsibilities of employers, manufacturer, employees, self-
employed workers, designers, importers and vendors.
 As for Factories and Machinery Act 1967, it provide for the control of factories on matters relating
to the safety, health and welfare of persons, and the registration and inspection of machinery.
 Some high risk machinery must be certified and inspected by DOSH. All factories and general
machinery must be registered with DOSH for the purpose of registration before they can be
installed and operated in Malaysia.
4.3 Business Support Facilities
4.3.1 Business Infrastructure

Industrial Estates

• Industrial estates has been developed by State Economic Development

Corporations (SEDCs), Regional Development Authorities (RDAs), port
authorities and municipalities.
• Currently there were over 200 industrial estates were developed by those
agencies and the new ones are continuously planned to meet the demand of
industrial land

Free Industrial Zones (FIZs)

• Established for manufacturing companies that produce or assemble products

mainly for export purposes.
• The manufacturing companies in FIZs enjoy minimal customs formalities and
duty free import of raw materials, component parts, machinery and equipment.
• They also have a minimal formalities for export their finished products.
4.3.1 Business Infrastructure

 Licensed Manufacturing Warehouses (LMWs)

 The purpose of LMWs is to encourage the dispersal of industries and
to enable companies to enjoy FIZ facilities in areas where it is neither
practical nor desirable to establish FIZs.
 In order to get an approval for LMWs the companies should have at
least 80% of their production meant for export and raw materials or
components are mainly imported.
4.3.1 Business Infrastructure

 Electricity and Water Supply

 Electricity for Peninsular Malaysia supply by Tenaga Nasional Berhad (TNB) while for Sabah
and Sarawak are Sabah Electricity Sdn. Bhd. (SESB) and Sarawak Supply Corporation
(SESCO) respectively.
 In term of water, it has been treated according to the World Health Organization (WHO)
standards for drinking and supply by state water department and water supply companies.
 Water costs are low and vary from state to state.
 Telecommunication Services
 Provided by Telekom Malaysia Berhad and other network service providers.
 There are six internet service providers which include Time, Celcom, Maxis, Digi.
 Satellite communication option.
4.3.1 Business Infrastructure

 Sea Ports, Cargo Transportation, Highway and Railway

Services
 Sea ports has modern facilities and equipment to facilitates full range of
cargo handling.
 Cargo transportation provide comprehensive containerized cargo
transportation services.
 The Malaysian Highway Authority provided latest design of
expressways which link to all major townships and potential
development area.
 Railway services operates by Keretapi Tanah Melayu (KTM) with the
capacity to transport goods ranging from grain to machinery
4.3.1 Business Infrastructure

 Multimedia Super Corridor (MSC)

 MSC was established with the aims to revolutionise how Malaysians and
others in the region conduct commerce in the digital age.
 MSC governed by groundbreaking Cyberlaws,policies and practices that
enable operating companies to harness the full potential of Information
Communications Technology and Multimedia.
 The ultimate aim of MSC is to attracts multimedia companies locally and
internationally to become world class over time.
4.3.2 Financial Assistance

 Objective  Type
1. Strengthening skills of 1. Soft loan
workforce 2. Grants
2. Entrepreneur development
3. Equity financing
3. Marketing & Promotion 4. Venture capital
4. Product Development & 5. Guarantee scheme
Quality accreditation
6. Tax incentives
5. Technology development
6. Debt restructuring
7. General
4.3.2 Who Provide the Financial
Assistance?

 Two main provider for financial assistance are ministry and

agencies.
 Ministry
1. Ministry of Entrepreneur and Co-operative Development
(MEDAC)
2. Ministry of Science, Technology and Innovation (MOSTI)
 Agencies - 26 agencies
1. Ministry of Entrepreneur
Development And Co-operative
(MEDAC)

 Financing scheme under MEDAC:

 ASEAN- Japan Development Fund
 SME Corporation & SME Bank
 Bank Kerjasama Rakyat
 TEKUN Nasional
 Equity Financing
 Franchise Development
 Perbadanan Nasional
2. Ministry of Science, Technology and
Innovation (Mosti)-Research &
Development

 MOSTI mostly focus on research and development grant.

 Applied Innovation Fund- Technology Readiness Level (TRL 2-4)
 Technology Development Fund 1-Technology Readiness Level (TRL 2-4)
 Technology Development Fund 2-Technology Readiness Level (TRL 4-7)
 Bridging Fund-Technology Readiness Level (TRL 7-9)
 MOSTI Combating Covid-19-Technology Readiness Level (TRL 2-9)
 Research Grant in collaboration with universities.
 https://edana.mosti.gov.my/
2. Ministry of Science, Technology and
Innovation (MOSTI)-National Technology &
Innovation Sandbox (SANDBOX)

 National Technology and Innovation Sandbox (NTIS) is a facility that

allows researchers, innovators, startups and high-tech entrepreneurs to test
their products, services, business models and delivery mechanisms in a live
environment.
 Opens to technologies, products, solutions and R&D for these prioritised
sectors, given the current needs.
 Medical & Healthcare Technology, Manufacturing, Agriculture, Education,
Travel & Tourism
 https://sandbox.gov.my/en/home#Introduction
2. Ministry of Science, Technology and
Innovation (MOSTI)-Malaysia Social
Innovation (MySI)
 Objective MySI
 Improving wellbeing of society with focus on B40 and affected group by COVID-
19 through application of technology locally developed ready to launch.
 Theme
 Communitizing technology future wellbeing.
 Area
 Energy, Business & Financial Services, Culture, Arts &Tourism, Medical &
Healthcare, Smart Technology & System, Smart Cities & Transportation, Water &
Food, Agriculture & Forestry, Education, Environment & Biodiversity
 Maximum of RM 300 000, https://mysi.innomap.my/
3. Ministry of Communications and Multimedia-
Malaysia Digital Economy Corporation (MDEC)

 SMART AUTOMATION GRANT

 To automate their business processes and move towards
digitalization.
 DIGITAL CONTENT GRANT
 Fund local creative content production companies
 GLOBAL TECH FUND (GTF)
 Assist local scale-up technology companies who are ready to go
into their first global market
 https://mdec.my/grant/
4.3.3 Other Government Agency

 Bank Kerjasama Rakyat

 Bank Pertanian- Agriculture related business
 Bank Negara Malaysia- SME Financing Ecosystem,
https://www.bnm.gov.my/sme-financing
 Bank Perusahaan Kecil & Sederhana Berhad (SME Bank)
 Perbadanan Nasional Berhad- Investment that need high initial
capital. https://www.pnb.com.my/
4.3.4 MANPOWER DEVELOPMENT &
TRAINING FACILITIES

 National Vocational Training Council

 Ministry of Human Resource
 Human Resource Development Fund- https://hrdcorp.gov.my/
 Malaysia Productivity Corporation (MPC)- Malaysia Productivity Fund
https://www.mpc.gov.my/background/
 Centre for Entrepreneur Development & research (CEDAR) under SME
Bank, https://www.cedar.my/about-us/about-us.html
 Perbadanan Usahawan Nasional Berhad, https://www.punb.com.my/en/
 Majlis Amanah Rakyat-for Bumiputra entrepreneur.
4.3.5 Other Technical Assistance

 Malaysian Agricultural Research and Development Institute (MARDI) -

Research and development related to agriculture
 Malaysian Palm Oil Board (MPOB) - Assistance related to palm oil and
palm oil product
 Fisheries Research Institute (FRI)-
 MIMOS Berhad - Technology development and research assistance.
 SIRIM Berhad-Testing and accreditation.
Conclusion

 Understand the required laws and regulation is important for entrepreneur

to start a business especially type of business entity need to be established.
 Establishing business entity need to consider business infrastructure
available such as electricity, water, internet, warehouse, logistic etc.
 Rule and regulation related to environment, safety, worker welfare is
paramount to ensure smooth operation to avoid legal conflict.
 Financial assistance such as bank loan or grant form government agencies
such as MOSTI will help technopreneur to obtain capital for starting or
expanding business.
References

 Suruhanjaya Syarikat Malaysia-Pandian Pendaftaran

https://www.ssm.com.my/bm/Pages/Services/Registration-of-Business-(
ROB)/Registration/Registration.aspx
 Ministry of Science, Technology and Innovation-SANDBOX Initiative-
https://sandbox.gov.my/
 Diyana Kamarudin et al (2020). Kejayaan Dalam Keusahawanan.
Pejabat Suara UMP.
 Noor Azlinna Azizan et al (2015). UGE2002 Technopreneurship
Module. Pusat Keusahawanan UMP.
 UiTM Entrepreneurship Study Group (2004). Fundamentals of
Entrepreneurship. Pearson Malaysia Sdn Bhd.