Labuan FSA wishes to reiterate on the matter pertaining to the requirement for Labuan foundation (particularly for Labuan non-charitable foundation) to obtain prior approval for endowment of Malaysian properties. These has been deliberated during the 9th Dialogue Session between Labuan FSA and Labuan Trust Companies dated 28 March 2019 and brought up again in the recent ALTC meeting on 22 October 2020 as a reminder. The requirement to obtain prior approval from Labuan FSA for endowment of Malaysian properties into Labuan Foundations will be on blanket approval or as and when required. Notwithstanding this, local Authorities’ approval would still be required and all relevant documents must be kept with trust companies.
In this regard, please find below the requirements to apply for blanket (one-off) approval on endowment of Malaysian properties to non-charitable Labuan foundation:
i) Letter of Undertaking (LOU) duly signed by the founder(s) of the foundation. The LOU should at least have the following information:
– assets to be endowed are from legal sources;
– only assets ultimately owned by the founder’s to be endowed into the foundation; and
– approval from local authorities is/will be obtained in relation to the Malaysian properties to be endowed to the foundation (where applicable).
ii) Letter by the trust company (TC) @ secretary to support the application. The TC must also confirm that they will carry out its professional roles including maintaining key information, documents and records related to the endowment of Malaysian properties and its should always be available for inspection as and when required by Labuan FSA.
The above application shall be submitted through COR@L system via “Maintain Malaysian Properties” business service together with processing fee of RM300 as per below:
Apart from this, please also take note on the following:
i.The foundation shall comply with para 9.3 of the Guidelines on the Establishment of Labuan Foundation including Islamic Foundation dated 4 April 2016 at all times;
ii. The client charter for application process is 14 working days. Nevertheless, ROC will facilitate to process the application accordingly; and
iii. The foundation shall fully aware of the requirements embedded in Labuan Foundation Act 2010 (LFA), particularly on the interpretation of “Malaysia”, “Malaysian property” and “Property” by virtue of Section 2 of LFA, as well as Section 5(2) that stated on Malaysian property.
Should you require any further clarification, please do not hesitate to contact ROC@labuanfsa.gov.my