To provide address and staffing plan at its operational office. The tax regime for international companies in Labuan is appealing to foreign investors who decide for such type of company in Malaysia. Labuan company makes or maintains professional contact with any counsel, attorney, accountant, bookkeeper, Labuan Trust company or a corporation wholly owned by a Labuan Trust company made available by the Labuan Trust company to act or be appointed as a resident director or a resident secretary of a Labuan company, management company, investment adviser or other similar person … For regulatory purpose, the policy expectation on the compliance to the revised Guidelines would be made on practical basis i.e. On 17 April 2020, the Labuan Financial Services Authority (“Labuan FSA”) issued a revised Guidelines on the establishment of Labuan International Commodity Trading Company (“LITC”) under the GIFT programme setting out the parameters relating to the establishment and operation of the LITC. The removal of LITC from the original list suggests that a revision of substantial requirements for LITC proposed earlier would be covered in a separate Order / Regulations although these have yet to be issued. The Labuan Financial Services Authority (LFSA) has issued guidelines applicable to all Labuan international trading companies (LITCs) licensed to conduct international commodity trading business in the Labuan International Business and Financial Center (LIBFC) under the Global Incentives For Trading … A rebranding exercise is currently on going to reflect the clear direction of the group as the name ‘LONGVIEW’ suggests. No. There is no restriction on the kind of projects that you can raise fund for in a Labuan Private Fund entity. Revised Substantial Activity Requirements for Labuan International Commodity Trading Company (“LITC”) under the Global Incentives for Tradin. This article aims to pull together various laws and successive development in the relevant laws relating to entities in Labuan, an island in the South China Sea established in 1990 as an international offshore financial centre (IOFC) and rebranded in recent years as an international business financial centre (IBFC) Financial Services. Company Profile. A Labuan international commodity trading business is the trading of physical and related derivatives of petroleum and petroleum-related products including liquefied natural gas (LNG), minerals, agriculture products, refined raw materials, chemicals, based minerals and coal. Achieve annual minimum turnover of USD50 million; Incur minimum annual business spending of RM3 million payable to Malaysian residents in Malaysian Ringgit; and. assessment against a full year’s operation as regards the annual quantitative requirements. internal controls and processes of the LITC. Labuan International Commodity Trading Company (LITC) - Breakdown by Type of Comodities Tarikh dicipta: 19 Oktober 2018 Tarikh dikemaskini: 18 Oktober 2019 Pembekal Set Data: Labuan FSA XLSX Post 17 April 2020, new Labuan companies that intend to trade in Non-Petroleum commodities are required to be part of the GIFT programme.Apart from the tax incentives as accorded under the Labuan Business Activity Tax Act 1990 subject to fulfilment of the tax substantial activity requirements, the non-deductibility rules under P.U. Labuan International Commodity Trading Company. Labuan International Commodity Trading Company (LITC) - Breakdown by Type of Comodities from 2015 to 2018 3. ; may carry out any business that is permitted in Malaysia in, from or through Labuan. Is this understanding correct? They are an offshore bank and onshore bankers.The offshore bankers are banks that operate in Labuan are licensed by Labuan FSA to facilitate international trades including Labuan companies for their international trades in foreign currencies, excluding Malaysia ringgit. The Labuan International Commodity Trading Company (‘‘LITC’’) is promoted under the Global Incentives for Trading (‘‘GIFT’’) programme. Last Updated: 14 January 2019. Residents and non-residents of Malaysia are allowed to establish Labuan companies. What are the post licensing requirements for an LITC? Our services include i) Malaysia Labuan international company registration ii) government licence registration iii) business bank account opening iv) employee recruitment … Only companies set up as Labuan International Trading Companies are accorded privileges under GIFT. For the purpose of complying with tax substance requirement where two full time employees (FTE) are required, these 2 FTE may not necessarily be the professional traders but they are required to be based in Labuan: making decisions that affect the whole, or a substantial part of the LITC business; implementing and enforcing policies and strategies approved by the LITC’s Board of Directors including Head of Department or any equivalent designated person; or. The LITC must indicate clearly on its letterhead, stationery and other documents including signage containing its name that it is licensed as a “Labuan International Commodity Trading Company licensed by Labuan FSA”, together with its licence number. Financial Services. (The business activity of Labuan International Commodity Trading Company has been deleted) 7. Labuan money broking business is intended to serve the institutional investors and high-net worth individuals. A copy of its audited financial statements within six (6) months after the close of each financial year. Under the programme, a set of incentives are offered through the establishment of the Labuan international commodity trading company (LITC), including incentives for traders and trading houses to use Malaysia as their international trading base. 3. Effective 17 April 2020, Labuan company that wants to trade in Non-Petroleum Commodities are required to be licensed under the GIFT programme. Labuan is a duty-free zone, hence there are no indirect taxes. 3. ; and (2) annual local spending of RM3 million (in Malaysia) and RM100,000 (in Labuan)?. A Labuan company is a company incorporated or registered under the Labuan Companies Act 1990 (LCA 1990). (The business activity of Labuan International Commodity Trading Company has been deleted) 7. Revision of substantial activity requirements for Labuan International Commodity Trading Company under the Global Incentives for Trading Programme Labuan Companies; Protected Cell Companies; Partnerships; Labuan Service Providers. Difference between Labuan International Company and Malaysian Sdn Bhd. As per Para. A) 375] were gazetted on 31 December 2018 to set out the relevant rules relating to Section 39(1)(r), with effect from 1 January 2019 (see Special Tax Alert No. Labuan Investment Committee Pronouncement 3-2020. This programme aims to position Malaysia as a regional trading and storage hub for oil and gas. Notwithstanding this, the LITCs may write to Labuan FSA if they foresee that they are not able to meet any of the operational requirements. However, for the purpose of complying with tax substantial activity requirements, once licensed, it is deemed to have commenced operation and is subjected to the said requirements. Indicate clearly on its letterhead, stationery and other documents including signage containing its name that it is licensed as a “Labuan International Commodity Trading Company” under the Labuan Financial Services and Securities Act 2010, together with its licence number, The business is conducted with proper corporate governance and has a risk management framework in place; and. RM100,000 (US$25,000) Labuan fund manager. Labuan International Commodity Trading Company (LITC) The Global Incentives for Trading (GIFT) programme is aimed at positioning Malaysia as a regional trading and storage hub for oil and gas. LITC must comply with the following conditions after the granting of its licence and commencement of its business: Client Charter and Related Guidelines and Circulars for Labuan Trust Companies, Labuan Foundations and Labuan Islamic Foundations. 6. Labuan leasing company or Labuan Islamic leasing company which has– 13. 9. How to apply and what are the conditions for licence under the GIFT programme? use Malaysia as an international trading base for specified types of commodities to be conducted on in, from or through Labuan. What are the permitted activities under the GIFT programme? The LITC’s business is the trading of physical and related derivative instruments of petroleum and petroleum-related products including liquefied natural gas (LNG). RM120,000 (US$30,000) Labuan leasing company or Labuan Islamic leasing company. the 2 full time employees (to be based at its physical office in Labuan) need not be the professional      traders. Under the programme, a set of incentives are offered through the establishment of the Labuan international commodity trading company (LITC), including incentives for traders and trading houses to use Malaysia as their international trading base. For the purpose of complying with tax substance requirement, out of this amount, at least RM100,000 must be spent/incurred for its operations in Labuan; and. The GIFT programme is a framework of incentives to attract traders of specified commodities to use Malaysia as their international or regional trading base. The pronouncement is available on Labuan IBFC’s website www.labuanibfc.com (Guidelines > General). The rate of tax imposed is 3% of audited net profits. The Labuan Financial Services Authority—the statutory body responsible for the development and administration of the Labuan International Business and Financial Centre (a special economic zone)—issued a circular (dated 29 April 2020) setting out revisions to the “substantial activity requirements” for eligibility as a Labuan international commodity trading company. Become a world renowned energy trading powerhouse creating economic value to our stakeholders. The Global Incentives for Trading (GIFT) programme, launched in collaboration with the Malaysia Petroleum Resources Corporation (MPRC), is aimed at positioning Malaysia as a regional trading and storage hub for oil and gas including other key commodities such as minerals, agriculture products, refined raw materials, chemicals, base minerals and coal. Employ at least three professional traders that fulfill the following requirements. RM120,000 (US$30,000) Labuan leasing company or Labuan Islamic leasing company. RM180,000 (US$45,000) Labuan trust company. The LITC is required to submit to Labuan FSA the following: The completed Annual Update Submission Form latest by 15 January of each year (as per Appendix I); and. 3. For the purpose of complying with the tax substantial activity requirements to enjoy the benefits accorded under the GIFT programme, Labuan FSA wishes to further clarify the following: Discover the wide range of business and financial services available in Labuan IBFC. Labuan International Commodity Trading Company (LITC) is curated to cater to the requirements of organisations and financial institutions yearning to access international trading markets in commodities like petroleum and petroleum-related products (including liquefied natural gas (LNG)), agriculture products, refined raw materials, chemicals, base minerals, carbon credits and any other commodities as maybe approved by Labuan … 3. Setting up a trading company in Labuan jurisdiction is an ideal choice as it offers a wide range of business activities permissible under the regulation of Labuan Financial Services Authority. Labuan International Commodity Trading Company (LITC) - Breakdown by Type of Comodities Created at: October 19, 2018 Updated at: October 18, 2019 Dataset Publisher: Labuan FSA XLSX For the Non-Petroleum LITC that have surrendered its licence arising from previous Guidelines issued on 8 March 2018, will it be required to be re-licensed and to comply with the revised Guidelines issued on 17 April 2020 immediately? A Labuan international commodity trading business is the trading of physical and related derivatives of petroleum and petroleum-related products including liquefied natural gas (LNG), minerals, agriculture products, refined raw materials, chemicals, base minerals and coal. Para 6.7 is to cater for LITCs that are undertaking businesses that are ancillary to the trading of permissible commodities such as leasing, trading, consultancy etc. 3. The most commonly used business form is the Labuan international company – the legal entity that allows for 100% foreign ownership and benefits from all of the tax advantages practiced in Labuan. This programme aims to position Malaysia as a regional trading and storage hub for oil and gas. Updated Guidelines on the establishment of Labuan International Commodity Trading Company under the Global Incentives for Trading Programme 3. Under this event, a set of incentives are offered through the establishment of the Labuan international commodity trading company (LITC), including incentives for trading […] Upon licensing, the LITC must ensure the following: LITC must comply with the following conditions after the granting of its licence and commencement of its business: The permitted activities include buying, selling and /or broking of physical and related derivative instrument of petroleum and petroleum-related products including liquefied natural gas (LNG) as well as other key commodities such as minerals, agriculture products, refined raw materials, chemicals, base minerals and coal. Labuan developments 1. The revised Guidelines have reinstated the non-petroleum commodities to be included back into the GIFT Programme. RM3,000,000 (US$750,000) Labuan bank, Labuan investment bank, Labuan Islamic bank and Labuan Islamic investment Bank. The Labuan international commodity trading sector recorded 12 new Labuan International Commodity Trading Companies (LITCs) in the year under review. LITCs that are unable to achieve the operational requirements under the revised Guidelines would be treated as non-compliant to the said Guidelines and be dealt with accordingly under the Labuan Financial Services and Securities Act 2010. What is the Labuan international commodity trading business? For instance, trading companies do not need to pay the 3% tax rate on profits, but a fixed tax of RMB 20,000 or approximately USD … Company Management Business; Wealth Management; Digital Financial Services; Capital Markets; Exchange; Labuan Structures. RM100,000 (US$25,000) Labuan fund manager. There are two types of bank accounts you can open for your Labuan International Company in Malaysia. The LITCs are still allowed to operate in any parts of Malaysia. Labuan International Commodity Trading Company (LITC) - Breakdown by Type of Comodities Labuan leasing company or Labuan Islamic leasing company which has– Our vision. 6.3 The LITC must indicate clearly on its letterhead, stationery and other documents including signage containing its name that it is licensed as a “Labuan International Commodity Trading Company licensed by Labuan FSA”, together with its licence number. 10. 3. Labuan International Business and Financial Centre (Labuan IBFC) presents a comprehensive midshore solution striking the ideal balance between client confidentiality and compliance with international … GUIDELINES ON THE ES TABLISHMENT OF LABUAN INTERNATIONAL COMMODITY TRADING COMPANY UNDER THE GLOBAL INCENTIVES FOR TRADING (GIFT) PROGRAMME PAGE 2/7 4.0 Effective Date 4.1 The Guidelines shall come into effect on 26 June 2013 and would remain effective and applicable unless amended or revoked otherwise. Employ at least three professional traders that fulfill the following requirements: The Principal officer or any person performing a senior management function who would be principally accountable for: making decisions that affect the whole, or a substantial part of the LITC business; implementing and enforcing policies and strategies approved by the LITC’s Board of Directors including Head of Department or any equivalent designated person; or. trading base, Labuan FSA launched the Labuan International Commodity Trading Company (LITC) which comes with a designed pack of incentives under the Global Incentives for Trading (GIFT) program. 8. These professional traders shall be involved in any one of the following areas: The LITC must have sufficient capital or working funds that commensurate with its operations and activities. Longview Resources Group (“Longview”) is a Hong Kong based and headquartered Group that is the product of a recent amalgamation of four formerly separate International Commodities Trading Companies. Ensure that the Principal Officer, Director(s) and Officer(s) responsible for the management of the company are fit and proper persons pursuant to Section 4 of LFSSA and the Guidelines on Fit and Proper Person Requirements issued by Labuan FSA. Revised Substantial Activity Requirements for Labuan International Commodity Trading Company (“LITC”) under the Global Incentives for Tradin. Labuan bank, Labuan investment bank, Labuan Islamic bank or Labuan Islamic investment bank: 3 (no change) 200,000 (previously RM180,000) 9. 3. Companies incorporated under this Act and which meet certain conditions, including substance requirements would be taxed at preferential rates. A Labuan International Commodity Trading Company and Malaysian residents; Labuan entities that have opted to pay tax under the ITA and Malaysian residents; and; Labuan entities that are paying taxes under the ITA and Labuan entities that are paying taxes under the LBATA. 3. The following details must be identified and provided to Labuan FSA prior to the commencement of business: Name, designation and contact details such as telephone number and e-mail address of the officer that is in charge of the LITC. Nevertheless, with the tightening of the Labuan substance requirement rules since 2019, it remains to be seen how the GIFT programme will be affected. Labuan International Commodity Trading Company. The Labuan international commodity trading company (LITC) must have sufficient capital/working funds that commensurate or are in accordance with its operations and activities. RM120,000 (US$30,000) Labuan leasing company or Labuan Islamic leasing company. The accumulated income generated by the LITCs increased by 39.2% to USD23.8 billion as compared to USD17.1 billion of the preceding year; with a majority of the income stream derived from trading in petroleum and petroleum-related products. RM3,000,000 (US$750,000) Labuan bank, Labuan investment bank, Labuan Islamic bank and Labuan Islamic investment Bank. The annual operating expenditures may be pro-rated on a 12-months basis upon commencement of LITC’s operations. may participate in business activities and enjoy attractive tax benefits provided under the Labuan Business Activity Tax Act 1990 (LBATA). For annual operating expenditures however may be pro-rated on a 12-months basis. Updated Guidelines on the establishment of Labuan International Commodity Trading Company under the Global Incentives for Trading Programme. For regulatory purpose and to enable the company to enjoy the tax incentives under GIFT Programme, the non-petroleum LITCs that have surrendered their licences should submit its application for licence as soon as practicable. Continued growth across the board in 2018, entrenching Labuan IBFC’s role as Asia’s preferred midshore business and financial centre. 2. The Labuan International Commodity Trading Company (''LITC'') is promoted under the Global Incentives for Trading (''GIFT'') programme. Banking; Insurance; Leasing; Factoring; Money Broking; Commodity Trading. In raising fund for a project with a private fund, the subscribers will typically be looking at a reasonable return on their investment at the very least. Labuan IBFC, as hosts to over 400 international financial institutions comprising 61 banks, 169 insurance and insurance-related companies, 176 leasing companies amongst others, is a natural and ideal location as it provides the Oil and Gas trading companies with a comprehensive range of financial products and services, both under conventional and Shariah-based principles. The GIFT programme is a framework of incentives to attract traders of specified commodities to use Malaysia as their international or regional trading base. Labuan commodity trading Labuan International Commodity Trading (LITC) is for traders of physical products and related derivatives, that primarily uses Malaysia as their base Eg, Petroleum related, liquefied natural gas, LNG, minerals, agriculture, refined raw materials, chemicals, base minerals, coal The Principal officer or any person performing a senior management function who would be principally accountable for: These professional traders shall be involved in any one of the following areas: Client Charter and Related Guidelines and Circulars for Labuan Trust Companies, Labuan Foundations and Labuan Islamic Foundations. A Labuan International Commodity Trading Company and Malaysian residents; Labuan entities that have opted to pay tax under the ITA and Malaysian residents; and; Labuan entities that are paying taxes under the ITA and Labuan entities that are paying taxes under the LBATA. Revised Substantial Activity Requirements for Labuan International Commodity Trading Company (“LITC”) under the Global Incentives for Tradin. 5. For those who are qualified, Labuan IBFC offers various financial products and services to meet your objectives, such as Labuan Leasing, Labuan International Commodity Trading Company (LITC). RM100,000 (US$25,000) Labuan fund manager. 2. Can the LITC operate out of Labuan but in Malaysia? Transactions between Labuan International Commodity Trading Company (LITC) and Malaysian residents; Transactions between Labuan entities that have opted to … Labuan International Commodity Trading Company. The definition of Professional Traders has been expanded under the revised Guidelines in which Principal Officer and any officer performing senior managerial functions in specified areas may also be recognised as Professional Traders. If a LITC has just been licensed in November/ December 2019, does it need to meet the annual quantitative requirements of Turnover, Domestic Spending and Professional Traders as well as Tax Substantial Activity Requirements? Banking; Insurance; Leasing; Money Broking; Commodity Trading; Credit Token Companies; Company Management Business; Wealth Management; Digital Financial Services; Capital Markets; Exchange; ... Search for Labuan Companies. internal controls and processes of the LITC. The said employees are expected to manage the daily operations of the activities out of its Labuan office. The Global Incentives for Trading (GIFT) programme is aimed at positioning Malaysia as a regional trading and storage hub for oil and gas. The top commodity trading companies come in different shapes and sizes, but typically are the juggernauts that cast an extensive influence on the commodity markets that they trade. What is the purpose of the Global Incentives for Trading (GIFT) programme? Labuan Investment Committee Pronouncement 3-2020 2. A Labuan company: may be a company limited by shares or by guarantee or an unlimited company. Labuan International Commodity Trading Company (LITC) - Surrendered & Revoked List; Credit Token Business; Company … Labuan bank, Labuan investment bank, Labuan Islamic bank or Labuan Islamic investment bank: 3 (no change) 200,000 (previously RM180,000) 9. A Labuan international commodity trading business is the trading of physical and related derivatives of petroleum and petroleum-related products including liquefied natural gas (LNG), minerals, agriculture products, refined raw materials, chemicals, base minerals and coal. International Commodity Trading Company enjoys a concessionary tax rate of 3%. For LITC that have already had its existing professional traders and wish to maintain them at its operational office outside Labuan, the LITC is required to hire additional 2 employees (any level) to be based in Labuan; and. Labuan Financial Services and Securities Act 2010, Guidelines on the Establishment of Labuan International Commodity Trading Company under the Global Incentives for Trading Programme, Directive on Labuan International Commodity Trading Company Trading in Non-Petroleum and Non-Petroleum-Related Commodities. With the issuance of Circular on revised substantial activity requirements for LITC dated 29 April 2020, does this mean that the LITC needs to comply the following: (1) 3 professional traders (to be based at its operational office in any parts of Malaysia) AND 2 full time employees (to be based at its physical office in Labuan)? The fees payable are illustrated in the table below: All licensees are required to pay to Labuan FSA annual licence fees on or before 15 January of each year. (A)375/2018 dated 31 December 2018 is not applicable to transactions between LITC and Malaysian residents. Additionally, Labuan jurisdiction being a midshore jurisdiction, offers the provision of dealing with the local market which is subjected to the local tax regime. Achieve annual minimum turnover of USD50 million; Incur minimum annual business spending of RM3 million payable to Malaysian residents in Malaysian Ringgit. Insurance Banking Labuan International Commodity Trading Company (LITC) The Global Incentives for Trading (GIFT) event is targeted to position Malaysia as a local trading and storage hub for gas and oil. What are the fees payable by LITCs in Labuan LIBFC? 1. Being new to Malaysia business environment and culture, it is a norm for foreigners get confused trying to figure out the right company entity to set-up to meet their business objectives. W. ith an international commodity trading company, a corporate group can manage its global trading and marketing activities within one or a few specialized The LITC is allowed to establish its operational office(s) and operate anywhere in Malaysia but it must have its physical office in Labuan to house its 2 FTE to manage the daily operations of the activities out of its Labuan office. Revised Substantial Activity Requirements for Labuan International Commodity Trading Company (“LITC”) under the Global Incentives for Tradin. Is there any transition given before it can be re-licenced? 4. Island Offshore Trading Pte Ltd (rebranding as Longview Resources (SG) Pte Ltd) A Singapore registered International Commodities Trading Company Ark Trading Ltd … Obtain prior approval from Labuan FSA on any new changes being effected on the following: The LITC is expected to comply with all the requirements of this Guidelines as well as the relevant requirements under LCA, LFSSA, other Labuan legislations and the laws of the jurisdictions in which the LITC operates from, whichever applicable. 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