It is easy to start or expand your own money broking or forex business in Asia Pacific through the Labuan jurisdiction which offers 100% foreign ownership and  low tax! The Labuan Authority has issued new guidelines for money broking business in Labuan effective 1st January 2018.

The money broking business is defined as the business of arranging transactions between buyers and sellers in the money or foreign exchange markets with brokers acting as an intermediary earning brokerage fees / commission. Labuan Forex Money Broking license, however, does not include the buying or selling of Malaysian Ringgit and foreign currencies by the broker as principal in such markets.

Get a Labuan Money Broking License - Structure Explained | QX Trust | Offshore Labuan Consultants


  • 100% foreign ownership, Malaysian local partner not required
  • 3% corporate TAX on trading profit
  • NO Withholding Tax on Interest, Management Fee, Royalty Fee and Technical Fee
  • NO Stamp Duty and GST
  • NO Import Duty / Sales / Service Tax
  • NO Capital Gain Tax and Inheritance Tax
  • Ability to access to more than 70 Malaysia Tax Treaty partners
  • 50% tax abatement for expatriate professionals/managers’ employment
  • 100% tax exemption on director’s fees for foreign directors
  • NO tax on dividends to shareholders
  • 2-year multiple entry working visa (renewable) to stay in Malaysia - Optional

Eligible Applicants include:

  1. Individual or institution with money broking expertise with a good track record and sufficient years of experience in the industry
  2. Regulated money broker or provider of such services from other jurisdictions with approval from home authority with the letter of consent
  3. Any licensed institutions including approved money broker under the Financial Services Act 2013 with approval from the Central Bank of Malaysia

Qualifying Eligibility for A Labuan Money Broker License

  1. All applicants must show at least three (3) years of good track record and relevant experience in the money broking business
  2. Applicants will be required to register a Labuan entity in order to operate the Labuan licensed money broking company with a paid-up capital of MYR 500,000

Regulatory and Operational Requirements for A Labuan Forex Money Broking License

  1. Minimum paid up capital of MYR 500,000 (or equivalent) unimpaired by losses with a certificate of evidence from the banks within Malaysia and Labuan
  2. Must maintain an operational office in Labuan and all transactions must be done to, through and from Labuan
  3. Transact in foreign currencies of your choice, including Malaysian Ringgit
  4. Transactions are allowed with Malaysian residents, including authorized dealers approved by the Malaysian Exchange Control
  5. The money broking company shall impose a maximum leverage limit of 100:1 on clients’ trading transactions (i.e. a minimum of 1% margin deposit to enable the opening of trade position). Example: if the transaction is USD 100,000, then the margin requirement is USD 1,000
  6. Ensure the counterparties ie principal broker or liquidity provider are regulated by a recognised supervisory or authority
  7. It is necessary to obtain approvals from the authorities who intend to operate prior commencing the business in those respective markets and such approvals have to be copied to Labuan FSA
  8. Where technology client interface is deployed, any intrusions or malfunctions of the systems incidents discovered must be reported to Labuan FSA with root cause and impact analysis report to be submitted within 14 days
  9. Labuan money broker must disclose to their clients the list of introducing brokers and their roles and responsibility
  10. The company must appoint an approved external auditor to carry out an audit of business operations annually
  11. Maintain a separate account for clients’ monies and marked clearly each clients monies in record and client’s withdrawal has to be done within 3 working days
  12. All written agreements and contracts with clients and any party are required to be documented
  13. The money broking company must have a principal broker, liquidity provider, trading platform provider and copies of agreements
  14. Mandatory to observe and comply with the AML/CFT Act and Guidelines issued by Central Bank of Malaysia and Labuan Authority via the provision of a compliance officer
  15. Changes on shareholders, directors, office location, additional office outside Labuan and outsourcing arrangements require prior approval from Labuan FSA
  16. Yearly license fee payable to Labuan FSA is MYR 5,000 (approx. USD 1,250 or equivalent)

Important Documents Required for Labuan Money Broking License Application

  1. A three (3) years Business Plan with its financial forecast and marketing strategies
  2. Profile of all Directors and Shareholders, including their qualifications
  3. Latest two (2) years Audited Accounts for current corporate company (if applicable)
  4. KYC, AMLA and Operations Manual / Procedures

Application Timeframe

  1. Approximately 30 to 60 days, subject to further information and supporting documents required by Labuan FSA during the approval process
  2. Interviews / Meetings with the key personnel may be requested by the Labuan FSA to understand or clarify certain processes.

STEPS to Apply for A Labuan Money Broking License

Get a Labuan Money Broking License | QX Trust | Offshore Labuan Consultants

QX TRUST, your one-stop Trust Company in Labuan!

QX TRUST license application service level for Labuan Money Broking License include:
  • Consultation on client's eligibility and application procedures
  • Feasibility study write-up based on client's profile
  • Due Diligence, Profiling and Guidance on documents preparation
  • Construct exclusive Business Plan to meet client's business objectives
  • Preparation of Financial Forecast, KYC, Operation and AML/CFT Manuals, Client Agreements etc
  • Submission and supervision of application process until approval
  • Act as liaison and key contact person for both client and Labuan FSA on all correspondences, meetings and /or interviews (if any)