Logistics Services
1. Warehousing Services
1.1 Approvals for Establishment
1.2 Other Approvals
1.3 Special Industrial Building Allowance for
Warehouses
1.4 Equity Requirements
2. Transportation Services
2.1 Licences
2.2 Equity Requirements
2.3 Exemption from Import Duty and Sales Tax on
Prime Movers and Trailers
Logistics Services
The term Logistics Services refer to a supply chain management process that plans,
implements and controls the efficient and effective flow and storage of goods,
services and related information between the point of origin and the point of
consumption in order to meet customers’ requirements.
- Transportation services
1. Warehousing Services
There are three (3) types of licences, depending on the warehousing requirements of
the operator. An operator can choose to operate an ordinary warehouse, a Public
Bonded Warehouse or a Private Bonded Warehouse.
Approval from the state Fire and Rescue Department is required to ensure that
the premise is equipped with an adequate number of fire extinguishers and
safety alarm systems.
99 Logistics Services
(ii) Public/Private Bonded Warehouse Licence
- Warehousing
- Break bulking
- Repackaging
- Consolidation
- Entreport
A company that wishes to provide bonded warehousing services must apply for a
licence to the Royal Customs Department.
The following approvals must be obtained before applying to the Royal Customs
Department:-
The FIC has further liberalised the policy on foreign equity participation in the
services sector by allowing foreign equity participation of up to 70%. The remaining
30% must be allocated to Bumiputeras, unless specific exemptions apply.
Companies that have been approved for Private Bonded Warehouses Licence are
exempted from the equity condition, while companies that have been approved for Public
Bonded Warehouse Licence would need to comply with the FIC equity guidelines. The
equity condition for warehousing activities is imposed by the Royal Customs Department.
2. Transportation Services
2.1 Licences
• Transportation Services
Commercial vehicles that are used in the transportation of container bulk, bulk
liquid and general haulage and freight, must be registered with the Road Transport
Department Malaysia (RTD).
- An Ad Valorem Registration Fee (AVRF) certificate and valuation (for trailers and
semi-trailers)
Companies that wish to transport nuclear and radioactive materials are required to
obtain a Class D Licence from AELB.
2.3 Exemption from Import Duty and Sales Tax on Prime Movers and
Trailers
Container haulage companies can apply for import duty and sales tax exemption on
prime movers and trailers that are not produced locally. Exemption from sales tax
may be considered for prime movers and trailers that are produced locally.
3.1 Licences
(b) Licensed freight forwarding agents and shipping agents including providers of
services for clearing of goods from Customs control, are also required to obtain
a Service Tax Licence.
The paid-up capital requirement and the duration of the licences approved for
different categories of freight forwarding agents and shipping agents are as follows:-
Companies approved as freight forwarding agents and shipping agents are required
to comply with the equity conditions imposed by the Royal Customs Department as
follows:-
• Shipping Agent -
At least 30% Bumiputera participation in the equity ownership, Board of
Directors, management and the whole employment structure
A company that undertakes both activities is also required to meet 51% Bumiputera
participation in the equity ownership, Board of Directors, management and its
whole employment structure.
Integrated logistic services comprise the entire supply chain management, including
procurement of software and hardware, warehousing, distribution (transportation
and freight services), packaging activities and customs clearance.
4.1 Incentives
New and existing companies providing the above services are eligible to apply for
incentives under the Promotion of Investments Act, 1986.
Eligibility criteria:
- Warehousing
- Transportation
- Freight forwarding
In addition to the above activities, the company should undertake at least one (1) of
the following activities:-
- Distribution
New Companies
- Pioneer Status with a tax exemption of 70% of the statutory income for a
period of five (5) years; or
- Pioneer Status with a tax exemption of 100% of the statutory income for a
period of five (5) years for projects located in the Eastern Corridor of
Peninsular Malaysia, Sabah and Sarawak
(ii) ITA
Companies that have been approved for incentives to provide ILS can apply for
expatriate posts, namely Key Posts and Time Posts. Upon approval, companies
should forward their applications for Employment Passes to the Immigration
Department for endorsement.
Investors intending to provide cold room and refrigerated truck facilities and related
services that require warehousing and transportation services are required to:-
The FIC has further liberalised the policy on foreign equity participation in the
services sector by allowing foreign equity participation of up to 70%. The remaining
30% must be allocated to Bumiputeras, unless specific exemptions apply.
5.3 Incentives
Companies providing cold chain facilities and services for perishable agricultural
produce such as fruits, vegetables flowers, ferns, and meat and aquatic products are
eligible for consideration for Pioneer Status or ITA:-
New Companies
- Pioneer Status with a tax exemption of 70% of the statutory income for a period
of five (5) years; or
- Pioneer Status with a tax exemption of 100% of the statutory income for a
period of five (5) years for projects located in the Eastern Corridor of Peninsular
Malaysia, Sabah and Sarawak
Existing Companies
- Pioneer Status with a tax exemption of 70% on the increased statutory income
arising from the reinvestment for a period of five (5) years; or
- Pioneer Status with a tax exemption of 100% on the increased statutory income
arising from the reinvestment for a period of five (5) years for projects located
in the Eastern Corridor of Peninsular Malaysia, Sabah and Sarawak.
- Expenditure for obtaining the building for use in post harvest activities
- Expenditure for the acquisition of plant, machinery and equipment for use in
activities that relate to freezing, cleaning, washing and packing
Eligibility criteria:
- At least 60% of the company’s total revenue must be derived from the provision
of cold room facilities, refrigerated transportation and other related services for
the local agriculture produce
(ii) Exemption from Import Duty and Sales Tax on Machinery and Equipment
Companies applying for incentives to provide cold chain facilities can also apply for
expatriate posts namely Key Posts and Time Posts. Upon approval, companies
should forward their applications for Employment Passes to the Immigration
Department for endorsement.
Applications for incentives, expatriate posts and exemption from Import Duty/Sales
Tax on Machinery and Equipment should be submitted to MIDA.