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Malaysia Revises Guidelines Regarding Foreign Fund Management
Washington, DC, July 7, 2000 - The Malaysian Securities Commission recently released revised guidelines on the establishment of foreign fund management companies in Malaysia.
As under the prior version of the guidelines—originally established as part of Malaysia’s offer in the WTO financial services negotiations that concluded in December 1997—foreign asset management firms have two options to establish a commercial presence in Malaysia. The options depend upon whether the foreign firm provides services to clients within Malaysia.
A foreign firm providing services to clients in Malaysia may establish a local affiliate in Malaysia, subject to three conditions:
- at least 30 percent of the affiliate’s shares are owned by Malaysian shareholders;
- the local affiliate must have at least $100 million in assets under management sourced from outside Malaysia; and
- each fund sourced within Malaysia managed by the affiliate must have at least 10 million ringgit (about $2.63 million) in assets.
A foreign firm that provides services only to clients outside Malaysia is not subject to these conditions. In either case, the firm must be incorporated in Malaysia, conduct all of its activities from an office in Malaysia, and have paid-up capital of at least 2 million ringgit ($526,330).