Labuan Public Funds are securities offered for subscription to any members of the general public. The mutual fund or fund sector in Labuan is allowed to be structured as a Labuan company, partnership, protected cell company (PCC), foundation or unit trust. You may also set up Labuan Islamic mutual funds operating in compliance with Shariah principles.

Two (2) types of funds are prescribed under the Labuan Financial Services and Securities Act 2010, namely private funds and public funds.

Differences of A Labuan Private Fund and A Public Fund

Description Private Fund Public Fund
Types of Entity Eligible to Register Labuan Company / LLP / PPC Labuan Company / LLP / PPC
Min. amount per Investor Min. MYR 250,000 for less than 50 investors

Min. MYR 500,000 for more than 50 investors


No limit on amount and number of investors
Currencies Any currencies including MYR Any currencies including MYR
Audit Report Optional Must report to LFSA on a yearly basis
Tax Rate 3% 3%
Custodian / Trustee Optional Yes, to appoint at least one
Fund Manager Optional Yes, with regular reporting
Memorandum of Information for Labuan FSA Approval Required Required
Termination of Fund Report Required Required
Crowd Funding Permission Not Allowed Allowed
Public Promotion Not Allowed

(Strictly Private Invitation)


Looking for a Private Fund?

Application Requirements

  1. A copy of the Memorandum and Articles of Association / Partnership agreement / trust deed / charter / other constituent documents as the case may be of the fund.
  2. Names, addresses, profiles and relevant experience of the director / general partner / designated partner / trustee / council members of the fund (Board of the public fund), whichever applicable. The appointment of any members of the Board of the public fund requires prior written approval from Labuan FSA.
  3. The profile of the promoter/custodian/trustee/fund manager, whichever applicable.
  4. An audited annual account of the promoter and fund manager, where applicable, for the three years preceding the application.
  5. The profile of the qualified person as its Shariah adviser in the case of a Labuan Islamic public fund.
  6. A signed declaration by the Board of the public fund on confidentiality and secrecy with regard to the operation and administration of the fund.
  7. A certificate from an expert as required under Section 11 of the LFSSA or Section 16 of the LIFSSA that includes a statement certifying that the Labuan public fund complies with the requirements under Part III of LFSSA or Part IV of the LIFSSA and the Guidelines on the Establishment of Labuan Mutual Funds Including Islamic Mutual Funds.
  8. A copy of the prospectus of the Labuan public fund which should comply with Section 35 of the LFSSA or Section 40 of the LIFSSA, either in draft or final form.

Regulatory and Operational Requirements for Labuan Public Fund

  1. Must appoint a fund manager, trustee, administrator and custodian that has been approved by Labuan FSA, they must be independent of each other
  2. If the fund is managed by a non-Labuan licensed fund manager, at least one of the service providers must be approved by Labuan FSA
  3. Maintain a registered office in Labuan with the appointment of a Trust Company as Resident Secretary
  4. All subscriptions shall be reimbursed immediately if the minimum level of subscription required is not met within the stipulated time frame
  5. Conduct business with due diligence and sound principles with all Board Members deemed as fit and proper persons in accordance with the Guidelines on Fit and Proper Person Requirements issued by Labuan FSA
  6. Maintain proper accounting and other records of each transaction with name and registration number, the financial state which has to be in line with the Directive on Accounts and Record-Keeping requirement issued by Labuan FSA. These records are to be indicated clearly on its letterhead, stationery, and other documents
  7. To appoint an approved auditor to carry out annual audit of the accounts with a submission of two copies of the audit report within 6 months after the close of every financial year
  8. Provide half-yearly reporting to the investors, which includes portfolio valuation report showing portfolio mix, the net asset value of the investment with an independent verification for the existence of the fund assets and the fund performance
  9. To notify Labuan FSA within 30 days of any amendments to its constituent document and business plan
  10. An approval is required from Labuan FSA for any changes to the Board members and key personnel
  11. The requirement of an auditor to ensure all assets returned to investors are made certain of the winding down of the matured fund
  12. Ensure compliance with the Anti-Money Laundering and Anti-Terrorism Financing Act and guidelines provided by Labuan FSA
To ensure proper policies and procedures are in place with a sound compliance framework to safeguard investors’ interests at all times.

The Prospectus to Register A Labuan Public Fund

The condition of the PROSPECTUS OF A LABUAN PUBLIC FUND should provide full, true and plain disclosure of all facts and circumstances aimed to provide a reasonable assessment by a prospective investor in determining whether to subscribe to the public fund, and the prospectus must disclose and contain the following information:-

  1. Description of the fund to include the date of issuance, mandate/objective, legal form and structure, tenure, target fund size, and geographical focus.
  2. The prospectus must be in the national language, either in Bahasa Malaysia or English.
  3. Information on the full details of the experience, the terms of appointment and termination of the Board members, key personnel, managers, custodian and trustee of the fund, whichever applicable.
  4. The Board members and key personnel’s particulars must include the following information:
    1. Any shares held by them in the fund
    2. Any borrowings are given by them to the fund
    3. Any other obligations of the fund to them
    4. Profile of the qualified person as its Shariah adviser for Labuan Islamic Public Fund
  5. The capital and income distribution policy of the fund.
  6. A statement in the prospectus to contain the following: “Labuan FSA takes no responsibility for the contents of this prospectus, makes no representations as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon any part of the contents of this prospectus. An investor is advised to clearly understand the risk(s) of the investment, seek professional consultancy, if necessary, and request for sufficient information to enable them to make a reasonable evaluation of the investment.”
  7. The investment strategy should include the investment policies and objectives and types of securities which the fund intends to invest.
  8. The names of all underwriters and amount proposed to be underwritten by each underwriter.
  9. Name the key features of the public fund to facilitate an investor in considering and comparing any similar investments on offer with the following information:
    1. Issued price of the shares
    2. Types of expenses to be incurred by the fund
    3. Potential risks for investing in the fund
    4. To the extent of listing the potential derivatives and unlisted securities to be invested. If it is intended for the fund not to invest in any of such investments, the prospectus must include an appropriate statement to that effect.
    5. The investment and borrowing limitations of the fund. This should include an analysis of the risks by its nature including the risks of the country and region where the fund is to be invested, if applicable.
  10. Financial results and projections with cash flow and profit based on its fund nature, investment policies and objectives, the proposed minimum subscription proceeds net of costs including the underwriting fees. Must have a clear policy on submission of financial reports including interim results and annual financial statements of the fund to its subscribers.
  11. Asset Valuation Policy including the financial reporting standards used for the preparation of the financial statements and the methods on valuing all the assets.
  12. Investor Care Framework to cover the following areas:-
    1. Rights of investors as stipulated in Section 36 of LFSSA or section 41 of LIFSSA guidelines
    2. All fees and costs that will be borne by all the investors
    3. Disclosure policy on conflict of interest for investor protection
    4. Complaint handling process
    5. Related party transaction policy including its disclosure policy
  13. Redemption policy to include information of procedure for redemption, timing, events where redemption right is suspended and pricing redemption or subscription of unit/shares of the fund.
  14. Material changes that affect any of the matters required to be disclosed in the prospectus and the fund manager shall within 30 days incorporate such changes to the prospectus and provide a copy of the supplementary/amended prospectus to each of the investors and Labuan FSA.

Note: For Labuan Islamic public fund, the description must state that the fund shall only participate in operations, administrations, investments and all other activities in compliance with Shariah principles. The details of taxes or zakat to be levied on income and/or capital of the fund and any taxes or zakat to be deducted from distributions to shareholders are to be disclosed.

The Investment and Borrowing Limitation of A Labuan Public Fund

Labuan public funds are required to establish the investment and borrowing limitations of its fund with a comprehensive and clear statement on the risks involved. The investment and borrowing limitations of the fund must be detailed, clearly defined and approved by the Board members or fund manager and it must then be disclosed in the constituent document/prospectus. If any of the limits on investment and borrowing is breached, the Board of the public fund or fund manager must take all necessary steps within a reasonable time frame to remedy the situation, protecting the interests of all investors.

Reporting Requirement for Labuan Public Fund

  1. Two (2) copies of audited financial statements to the Supervision and Enforcement Department within six (6) months after the closure of each financial year, either in hardcopy or digital format; and
  2. Other statistics and information as Labuan FSA may require from time to time

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

We offer a one-stop-shop solution; from the promoter’s idea to successful implementation and administration of investment funds and vehicles.

QX TRUST provides the following services that are customised to meet any fund objectives:

  • Preliminary evaluation of the investment strategy and business considerations
  • Feasibility study write-up based on client's profile
  • Assistance with the selection of an appropriate entity for the fund
  • Advice in relation to jurisdictional regulations
  • Advice on the fund structure
  • Drafting the fund prospectus / offering documentation and agreements
  • Distribution of offering circulars to prospective investors
  • Processing share issues and redemptions
  • Maintaining the principal accounting books and liaison with auditors
  • Disbursement of dividends, fees, directors’ salaries, overheads etc
  • Holding and keeping minutes of shareholders’ and board of directors’ meetings
  • Addressing and submission of regulatory compliance