Location – Situated on the northern edge of Brunei Bay facing the South China Sea, the Federal Territory of Labuan is part of Malaysia. It consists of Labuan Island and six other smaller islands. Administration Administered by the Federal Government of Malaysia.
Population --About 78,000
Languages – Main language is Bahasam Melayu, English, Tamil and various Chinese dialects are widely spoken.
Legal System – English Common Law
Currency – Malaysian ringgit (approx. USD 1 : MYR 3.7)
Exchange Control – None
Economy – Oil and gas industry Business and Financial services
Time Zone – GMT +8
Principal Corporate Legislation – Malaysia Offshore Companies Act 1990
Labuan was established as an international offshore financial centre in October 1990, but 2002 was the year in which the territory established itself irrevocably as a premier player. It is now recognized by the international financial community as a world centre for Islamic banking and finance.
LOFSA, the Labuan Offshore Financial Services Authority, was established in 1996 as a single regulatory agency or one-stop agency. This has contributed greatly to the growth in the number of offshore companies over the past ten years. Companies can make use of Malaysia's more than 60 double tax treaties (“DTAs”), of which around 50 are in force, and the island has become the preferred conduit for FDI into a number of countries in the region, including Korea and Malaysia itself.
Labuan claims to be virtually the only offshore supermarket in the vicinity of the rapidly expanding economies of Asia offering comprehensive and integrated offshore financial services and products. Commentators predict that the LabuanIOFC will attract a substantial flow of funds from the region in the years ahead, because the operating costs in Labuan are substantially cheaper than in other financial centre around the region.
FEATURES AND BENEFITS
Labuan plays an effective role in the development of the economies of ASIAN countries.
All offshore business transactions attract no stamp duty and capital gains are not subject to any form of tax.
Not subject to Malaysian exchange controls.
Malaysia enjoys tariff reductions in the ASEAN Free Trade Area (“AFTA”), and more than 60 DTAs have been signed.