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Featured Ideas & Insights Publications US Desk

Nasdaq Private Market vs Nasdaq Capital Market

Nasdaq Private Market-cover

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Understanding the key differences between these two platforms, Nasdaq Private Market and Capital Market are essential for companies evaluating their fundraising, liquidity, governance, and long-term growth strategies.
While both Nasdaq Private Market and Nasdaq Capital Market provide avenues for companies to access capital and liquidity opportunities, they serve fundamentally different purposes and stages of a company’s growth journey.

Nasdaq Private Market is designed for private companies seeking to facilitate secondary transactions and shareholder liquidity without becoming publicly listed, whereas Nasdaq Capital Market is a public stock exchange tailored for smaller-cap companies that wish to access the public capital markets. Understanding the key differences between these two platforms are essential for companies evaluating their fundraising, liquidity, governance, and long-term growth strategies.
Item Nasdaq Private Market Nasdaq Capital Market
NaturePrivate market / secondary liquidity venuePublic stock exchange
Company StatusPrivate companiesPublic listed companies
SEC Registration as Public CompanyNot required (generally)Mandatory
Public TradingNoYes
IPO RequiredNoYes (or direct listing/SPAC)
Investor AccessMostly accredited / institutional investorsOpen to public investors
LiquidityLimited / event-drivenContinuous daily trading
Valuation TransparencyLimitedHigh transparency
Item Nasdaq Private Market Nasdaq Capital Market
Share Price VisibilityNegotiated privatelyReal-time public pricing
Disclosure LevelLimited private disclosuresFull SEC disclosure
Financial ReportingUsually private-company standardSEC reporting (10-K, 10-Q, 8-K)
Corporate Governance RulesFlexibleStrict Nasdaq governance rules
Market MakersNot applicableMinimum 3 market makers
Public Float RequirementNo formal public floatYes
Public Shareholders RequirementNo public spread requirementYes
Minimum Bid PriceNo exchange bid-price ruleUsually US$4 initial listing
Delisting RiskMinimal exchange riskSubject to Nasdaq compliance rules
Trading MechanismTender offers, auctions, block tradesExchange order book
Typical UsersUnicorns, startups, pre-IPO firmsSmall-cap public companies
ExamplesOpenAI secondary, SpaceX secondary type dealsSmall-cap biotech, tech, growth companies

Key SEC / Regulatory Difference

Item Nasdaq Private Market Nasdaq Capital Market
Securities Act RegistrationUsually exemptRequired
Exchange Act RegistrationOften exemptMandatory
Main SEC Filings Form D (Private fundraising, venture rounds, private placement offerings), Form 144 (Affiliates/insiders resell restricted securities, usually applies to: founder sales, investor secondary sales), Schedule TO "tender offer" docs (organized tender offer, company-sponsored liquidity event) S-1/F-1, 10-K, 10-Q, 8-K
Trading Venue RegulationATS / broker-dealer rulesNational securities exchange
Sarbanes-Oxley ComplianceUsually not required fullyRequired
PCAOB Audit RequirementOften not mandatoryMandatory

Practical Business Difference

Nasdaq Private Market
Best for:
  • Unicorns delaying IPO
  • Employee liquidity programs
  • Founder/investor secondary sales
  • Controlled shareholder base
  • Less disclosure burden

Typical companies:
  • Late-stage startups
  • Venture-backed tech firms
  • Companies wanting liquidity without going public

Nasdaq Capital Market
Best for:
  • Companies seeking public capital raising
  • Companies needing liquidity + visibility
  • M&A currency (public shares)
  • Institutional investor access

Typical companies:
  • Small-cap biotech
  • Growth technology companies
  • Foreign issuers entering U.S. capital markets

Cost & Compliance Comparison

Item Nasdaq Private Market Nasdaq Capital Market
Legal CostModerateHigh
Audit RequirementFlexibleExtensive
Investor RelationsLimitedContinuous
Quarterly ReportingUsually noYes
Annual Proxy FilingNoYes
SOX Internal ControlsUsually noYes
Listing FeesLowerHigher
Ongoing Compliance CostLowerSignificant

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Featured Ideas & Insights Publications US Desk

Nasdaq – U.S. Domestic Issuer vs Foreign Private Issuer (FPI)

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Companies seeking a Nasdaq listing must determine whether they qualify as a U.S. Domestic Issuer or a Foreign Private Issuer (FPI). This classification affects reporting obligations, corporate governance requirements, disclosure standards, and ongoing compliance responsibilities under U.S. securities laws.

1. Definitions

Item U.S. Domestic Issuer ("Local Issuer") Foreign Private Issuer (FPI)
Definition A company organized/incorporated in the U.S. A company incorporated outside the U.S. that qualifies as an FPI under SEC rules
Governing Rule U.S. domestic reporting company SEC Rule 405 / Exchange Act Rule 3b-4
Key Test Incorporated in U.S. Incorporated outside U.S. AND does NOT fail FPI tests
FPI Disqualification N/A Becomes non-FPI if: >50% voting shares held by U.S. residents AND any of below apply: 1) majority directors/officers are U.S. citizens/residents, 2) >50% assets in U.S., or 3) business principally administered in U.S.

2. IPO Filing Forms

Purpose U.S. Domestic Issuer Foreign Private Issuer
Initial IPO Registration Form S-1 Form F-1
Short-form shelf registration (seasoned issuers) Form S-3 Form F-3
Registration for M&A/share exchange Form S-4 Form F-4
Exchange Act registration Form 10 Form 20-F (registration/annual)

3. Main IPO Registration Forms

U.S. Domestic Issuer — For m S-1
Used by U.S. companies conducting IPOs.

Key Contents:
  • Prospectus
  • Audited financial statements
  • MD&A
  • Risk factors
  • Use of proceeds
  • Executive compensation
  • Shareholding structure

Foreign Private Issuer — Form F-1
Equivalent of S-1 for foreign companies.

Differences vs S-1:
  • May use:
    • IFRS as issued by IASB (without US GAAP reconciliation in many cases)
    • Home-country governance exemptions
  • Executive compensation disclosure often lighter
  • Less frequent ongoing reporting obligations post-IPO

4. Post-IPO SEC Reporting Obligations

Ongoing Reporting Comparison

Filing Requirement U.S. Domestic Issuer Foreign Private Issuer (FPI)
Annual Report Form 10-K Form 20-F
Quarterly Report Form 10-Q Not required, but Form 6-K is often used by FPI to furnish interim financial statement that: is made public in their home country, filed with foreign stock exchanges, or distributed to shareholders.
Current Material Event Report Form 8-K Form 6-K
Proxy Statement Schedule 14A Often exempt from U.S. proxy rules
Insider Ownership Filing Forms 3, 4, 5 Usually exempt
FD Fair Disclosure Rules Applies Generally exempt
US GAAP Requirement Yes IFRS permitted
Filing Frequency More frequent Less burdensome

5. Key SEC Forms After IPO

U.S. Domestic Issuer
FormDescription
10-KAnnual audited report
10-QQuarterly financial report
8-KMaterial event disclosure
DEF 14AProxy statement
Forms 3/4/5Insider ownership reporting
S-8Employee stock plans
S-3Secondary offerings / shelf registration

Foreign Private Issuer

FormDescription
20-FAnnual report
6-KMaterial updates/interim disclosures
F-3Shelf registration
F-4M&A/share exchange transactions
F-6ADR registration
13D / 13GBeneficial ownership filings (where applicable)

6. Current Reporting — 8-K vs 6-K

Item Form 8-K Form 6-K
Used By U.S. Domestic issuers FPIs
Filing Trigger Mandatory specific events Furnishing material information made public in home market
Timing Usually within 4 business days Promptly after disclosure
Prescriptive? Highly prescriptive More flexible

Examples:

  • Acquisition
  • CEO resignation
  • Bankruptcy
  • Material agreement
  • Earnings release

7. Financial Reporting Standards

Item U.S. Domestic Issuer Foreign Private Issuer (FPI)
Accounting Standard US GAAP mandatory IFRS accepted
PCAOB Audit Required Required
Currency USD usually Foreign currency permitted

8. Corporate Governance Differences

Topic U.S. Domestic Issuer Foreign Private Issuer (FPI)
Nasdaq/NYSE Governance Full compliance May follow home-country practices
Independent Directors Strict rules Some exemptions
Shareholder Approval Rules Full compliance Certain exemptions

9. ADR Structure (Common for Foreign Issuers)

Many FPIs list in U.S. through:
  • ADR (American Depositary Receipt)

Relevant form:
  • Form F-6

Examples:
  • Alibaba Group
  • Toyota Motor Corporation
  • Grab Holdings

10. Why Many Foreign Companies Prefer FPI Status

Advantages
  • Less frequent reporting
  • No quarterly 10-Q
  • IFRS accepted
  • Reduced executive compensation disclosure
  • Home-country governance exemptions
  • Reduced insider reporting burden

Disadvantages
  • Some U.S. investors prefer domestic issuer transparency
  • May trade at lower valuation multiple in certain sectors
  • Potential governance perception issues

11. Quick Summary Table

Topic Domestic Issuer Foreign Private Issuer
IPO Form S-1 F-1
Annual Report 10-K 20-F
Quarterly Report 10-Q None
Current Report 8-K 6-K
Accounting Standard US GAAP IFRS allowed
Insider Forms 3/4/5 Usually exempt
Governance Rules Full U.S. rules Partial exemptions
Reporting Burden Higher Lower

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Featured Ideas & Insights Publications Tax

PENGERANG INTEGRATED PETROLEUM COMPLEX (“PIPC”)
Special Incentive Package for Manufacturing Sector

PIPC-cover

PENGERANG INTEGRATED PETROLEUM COMPLEX (“PIPC”)
Special Incentive Package for Manufacturing Sector

PIPC offers highly attractive tax incentives packages for manufacturing investors, including up to 10 years of income tax exemption, customs duty exemptions on importation of machinery, equipment and raw materials and reduced tax rates on qualifying activities.
Strategically located in Johor, Malaysia, the Pengerang Integrated Petroleum Complex (PIPC) is a fully integrated oil and gas megaproject that positions Malaysia as a leading energy and petrochemical hub in Southeast Asia. With world-class infrastructure, deepwater port access, and strong government support, PIPC offers investment opportunities in the downstream and midstream sectors.

Attractive Tax Incentives

Incentive Type
Details

1.

Special Income Tax Rate
  • 5% or 10% tax rate for up to 10 years on qualifying income; OR

2.

Investment Tax Allowance (ITA)

  • 60% or 100% capital expenditure allowance for up to 10 years;
  • Offset up to 100% of statutory income for each assessment year.

Import Duty and Sales Tax Exemptions

Exemptions on machinery, equipment, raw materials, and components used in qualifying manufacturing activities.

Stamp Duty Exemptions

Potential exemptions on property transfers and loan agreements related to approved projects.

Eligible Activities and Products

Production and processing of chemical and petrochemical products:-
i. Base Chemical – Methanol, Ethylene, Propylene, Benzene, Aromatics
ii. Organic Intermediates – C1 to C6 ;
iii. Specialty Chemical;
iv. Fertilisers;
v. Polymers/ Plastics;
vi. Oleochemical/ Biochemical

Who Can Apply

  • Local and foreign companies incorporated in Malaysia;
  • A minimum capital investment of RM500 million in qualifying manufacturing activities within PIPC.
This incentive is eligible to be considered for application received by Malaysian Investment Development Authority (“MIDA”) from 14th October 2023 to 31st December 2028.

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Malaysia My Second Home (MM2H) Programme

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Malaysia My Second Home (MM2H) Programme

Malaysia My Second Home (MM2H) Programme is a programme promoted by the Government of Malaysia to allow foreigners who fulfil certain criteria to obtain multiple-entry social visit pass to stay in Malaysia.

Malaysia My Second Home (MM2H) Programme

  1. Malaysia My Second Home (MM2H) Programme is a programme promoted by the Government of Malaysia to allow foreigners who fulfil certain criteria to obtain multiple-entry social visit pass to stay in Malaysia.
  2. Multiple-entry social visit pass valid for 5 to 20 years and is renewable.
  3. This programme opens to all citizens from all the countries recognised by Malaysia, regardless of religion, race, gender and age.
  4. Principal applicants are allowed to bring their spouse, unmarried children below the age of 21 and parents.
  5. More than 50,000 participants around the world participate in this programme.

Why Malaysia

  1. This programme is promoted by the Government of Malaysia.
  2. Multilingual country, no difficulties on daily communication.
  3. No natural disaster and political stable.
  4. Comprehensive Educational System.
  5. Comprehensive healthcare system and services.

Benefits of MM2H

  1. From a period of five (5) years, and is renewable.
  2. Unlimited access to Malaysia.
  3. Pension remitted to Malaysia are eligible to tax exemption, such as Fixed Deposit.

MM2H REQUIREMENT – PLATINUM, GOLD, SILVER

Category & Requirement
Platinum
Gold
Silver
1. Fixed Deposit
RM 4,500,000
(USD 1,000,000)
RM 2,000,000
(USD 500,000)
RM 630,000
(USD 150,000)
2. Purchase of Residential Property

RM 2,000,000 and above

RM 1,000,000 and above

RM 600,000 and above
3. Maximum Withdrawal from Fixed Deposit
50%
4. Minimum length of stay
90 days per annum
5. Dependents
Spouse, Children, and Parents
6. Business / Investment Activities

Permissible

Not allowed
7. Career Opportunities

Permissible

Not allowed
8. MM2H Pass Renewable
20 Years
15 Years
5 Years

MM2H REQUIREMENT – SPECIAL ECONOMIC ZONE (SEZ)

Category & Requirement

Special Economic Zone
1. Special Economic Zone Area

a) Forest City
b) Iskandar Puteri

c) Johor Bahru City Centre
d) Pasir Gudang

e) Kulai
f) Pontian
2. Fixed Deposit
USD 65,000 (Age 21-49)
USD 32,000 (Age above 50)
3. Purchase of Residential Property
No Limit, but need to directly purchase from Developer. (Cannot sell for Ten years)
4. Maximum Withdrawal from Fixed Deposit
50%
5. Minimum length of stay
90 days per annum
6. Dependents
Spouse, Children, and Parents
7. Business / Investment Activities
Not allowed
8. Career Opportunities
Not allowed
9. MM2H Pass Renewable
10 Years

MM2H PROGRAMME STATISTIC

2002 to 2019*(Top 10)
*For 2019, only data on applications – not approvals – are available
People’s Republic of China
15,883
Japan
5150
People’s Republic of Bangladesh
4,335
Republic of Korea
3,093
United Kingdom
2,892
Hong Kong S.A.R
1,691

Republic of Singapore

1,611
Republic of China (Taiwan)
1,518
Islamic Republic of Iran
1,428
Republic of India
1,150
Others
9,720

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Featured Ideas & Insights Publications Tax

Automation Capital Allowance (Automation CA) for Manufacturing and Servicess Sectors

MY - man-hard-hat-is-working-robot

AUTOMATION CAPITAL ALLOWANCE (AUTOMATION CA) FOR MANUFACTURING AND SERVICES SECTORS

Manufacturers involved in innovative and productive activities eligible for an Automation Capital Allowance (Accelerated Capital Allowance) of 200% on the first RM10 million of qualifying capital expenditure.

Automation Capital Allowance (Automation CA) For Manufacturing And Services Sectors

1) Objective:

The Automation Capital Allowance (Automation CA) was introduced to encourage adoption of automation among manufacturing companies.

2) Tax Incentive

Categories

Tax Incentive

1.

High labour-intensive industries (rubber products, plastics, wood, furniture and textiles)

2.

Other industries including Service Sector

Automation CA of 200% on the first RM10 million in qualifying expenditure incurred within year of assessment from 2023 to 2027

3) Eligibility Criteria

  • Companies must be incorporated under the Companies Act 2016;
  • Tax residents of Malaysia;
  • Companies must have been operating in manufacturing or services activities for a minimum of 36 months;
  • The company must incur expenditures for at least one (1) machinery /equipment / software / system with an adaptation of Industry 4.0 within the eligible amount of RM10 million
  • Industry 4.0 elements:-
  • √ Big Data Analytics;
  • √ Cloud Computing;
  • √ Augmented Reality;
  • √ Cybersecurity;
  • √ Artificial Intelligence;
  • √ Additive Manufacturing;
  • √ System Integration;
  • √ Simulation;
  • √ Internet of Things (IoT);
  • √ Autonomous Robots;
  • √ Advanced Materials.

This incentive is eligible to be considered for application received by MIDA from 1st January 2023 until 31st December 2027.

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Incentive For Reinvestment Under New Industrial Master Plan (NIMP) 2030

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Incentive For ReinvestmentUnder New Industrial MasterPlan (NIMP) 2030

New Industrial Master Plan (NIMP) 2023 offers reinvestment incentive with two tiers. Tier 1 providing Investment Tax Allowance (“ITA”) of 100% qualifying capital expenditure (“QCE”) against 100% of statutory income and Tier 2 offering ITA of 60% QCE against 70% of statutory income. This incentive is designed to encourage existing companies to reinvest in high-growth and high-value activities.

Incentive For Reinvestment Under New Industrial Master Plan (NIMP) 2030

  1. Malaysian government has introduced a reinvestment incentive aligned with the New Industrial Master Plan (NIMP) 2030, featuring a tiered and outcome-driven framework.
  2. Objectives of the incentive are:
    • To motivate companies to invest in sectors with high growth potential and substantial value.
    • To ensure that the tax incentives provided by the Government support the achievement of the targeted outcomes under the NIMP 2030 and further stimulate national economic growth.
  3. This incentive provides an opportunity for existing companies that have exhausted their Reinvestment Allowance, to continue to increase their capacity and investment in high-growth and high-value areas in the country.

A. Type of Incentives

  • The incentive is an Investment Tax Allowance (ITA) of 100% (or 60%) on the qualifying capital expenditure (excluding land cost) incurred for 5 years.
  • The allowance can be offset against up to 100% (or 70%) of statutory income for each assessment year until fully utilized.

B. Eligible Applicant

  • The company must be a Malaysian resident and incorporated in accordance with the Companies Act 2016.
  • Undertake expansion or diversification projects in the manufacturing sector.
  • The company eligible for only one (1) round of this reinvestment incentive.

C. Eligibility Criteria

List of product(s) or activity(ies) eligible for the reinvestment incentive as below:
  • Aerospace
  • Automotive
  • Chemical including biotechnology
  • Electrical & Electronics
  • Food Processing
  • Halal
  • Machinery & Equipment
  • Medical Devices
  • Metal
  • Mineral
  • Palm Oil-based Products
  • Pharmaceutical including biotechnology
  • Petroleum Products and Petrochemicals
  • Rail
  • Rubber-based Products
  • Ship building and Ship Repair
  • Textile, Apparel and Footwear
  • Wood, Paper and Furniture
The tiering tax incentive will be based on an outcome-based approach as follows:
Tier 1
Tier 2
Tax incentive
ITA of 100% on qualifying capital expenditure (QCE) (excluding land) and set off against 100% of statutory income.
ITA of 60% on QCE (excluding land) and set off against 100% of statutory income.
Incentive period
5 years
Minimum Conditions
  1. QCE must be incurred within the proposed 3-year period capital expenditure (excluding land) to be realised within 3 years as proposed;
  2. Implementation of Industrial Revolution 4.0 (IR4.0) technologies is required; and
  3. R&D expenditures (included related to product and technology improvement) must align with the proposed plan.
Additional Conditions
Subject to the following outcomes (but not limited to):

  1. Adequate number of newly hired Malaysian full-time employees in high-value positions (with minimum basic salary RM 10,000/month);
  2. The number of local and/or local service providers (companies incorporated in Malaysia) engaged as proposed;
  3. Adoption of green technology (generation of renewable energy or utilisation of energy efficiency equipment); and
  4. Any additional requirements for sustained economic growth, as stated in the approval letter.

Not Applicable.

D. Date of Application

Applications received by Malaysia Investment Development Authority (“MIDA”) from 1 January 2024 until 31 December 2028 are eligible to be considered for this incentive.

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Johor-Singapore Special Economic Zone (JS-SEZ)

Johor-Singapore Special Economic Zone-cover

Johor-Singapore Special Economic Zone (JS-SEZ)

On 8 January 2025, Malaysia Government announced tax package incentive for The Johor-Singapore Special Economic Zone (JS-SEZ). JS-SEZ offers a special corporate tax rate 5% for up to 15 years for new investment in qualifying activities such as aerospace manufacturing, medical devices, global services hubs and artificial intelligence and also special personal income tax rate 15% for 10 years for knowledge worker.

Introduction

Johor-Singapore Special Economic Zone (JS-SEZ) is the first special economic zone spanning Southeast Asia’s borders located in the southern Malaysian state of Johor.

Effective from January 1, 2025, companies undertaking new investment in high-growth sectors within the JS-SEZ eligible to apply for special corporate tax rate of 5% for up to 15 years, 15% tax rate up to 10 years for knowledge workers employed in the JS-SEZ, stamp duty exemption etc.

Location

Source: www.irda.com.my

Why Invest in JS-SEZ

Invest-JS-SEZ-01
Competitive Cost Advantage
Invest-JS-SEZ-02
Strong Government Support
Invest-JS-SEZ-03
Designated Flagships Areas
Invest-JS-SEZ-04
Strategic Location & Strong Connectivity
Attractive Policies & Incentives

Competitive Tax Incentive

A. Special Tax Corporate Tax Rate:

Special tax rate of 5% for up to 15 years for companies undertaking new investment as below:

No.

Category
Type of Incentive
1.
Flagship F (Kulai – Sedenak)

Manufacturing Company:
  1. Artificial Intelligence (AI), Quantum Computing Supply Chain;
  2. Medical Devices; or
  3. Pharmaceuticals.

Flagship E (Senai – Kulai)
Aerospace Manufacturing; and Maintenance Repair and Overhaul (MRO) Services.

2.

Flagship A (Johor Bahru Waterfront) and

Flagship B (Iskandar Puteri)
Global Service Hub.

Qualifying Services:
  1. Regional P&L;
  2. Strategic Business Planning;
  3. Corporate Development; and
  4. Regional or Global Treasury and Fund management conducting cash pooling activities via onshore intermediaries.
Special tax rate of 5% for a period of up to 15 years;

Eligibility Criteria / Conditions
  1. Annual operating expenditure of at least RM50 million;
  2. Company must Serve / Business Control of at least 10 Network Companies;
  3. Annual sales turnover of at least RM500 million and forex in-flow into the local banking system as proposed;
  4. A minimum of 50% of high-value positions (with a minimum monthly basic salary of RM10,000) shall be filled by full-time Malaysian employees as proposed.
3.
Flagship G (Desaru-Penawar)

Integrated Tourism Development
100% Investment Tax Allowance (ITA) on eligible capital expenditure (excluding land cost) for a period of 5 years. This allowance can be deducted up to 70% of statutory income for the relevant assessment year.

Eligibility Criteria / Conditions
  1. Company which does not have an existing entity or related entity undertaking same hotel or tourism project in Malaysia;
  2. Paid-up capital of at least RM2.5 million;
  3. Investment in capital expenditure (excluding land) of at least RM500 million;
  4. Company undertaking integrated tourism project which consists of the following:
    1. Hotel with minimum number of rooms of 80 which consists of standard, superior, deluxe and suite; and
    2. Minimum 1 tourist attractions (i.e. water park, outdoor park consists of rides and/or games, convention centre with capacity minimum of 3,000 participants, or outdoor sport excluding golf course and driving range).

4.

Flagship C (Tanjung Pelepas)

Smart Logistics Complex
Smart logistic operator who invests in development of smart logistics and carry out any of the eligible logistic activities:

a. Regional Distribution Hub;
b. Integrated Logistics Services;
c. Dangerous Goods Storage;
d. Cold Chain Facilities
100% Investment Tax Allowance (ITA) on eligible capital expenditure (excluding land cost) for a period of 5 years. This allowance is deducted up to 100% of the statutory income for the relevant assessment year.

Eligibility Criteria / Conditions
  1. Investment in capital expenditure (excluding land) of at least RM500 million;
  2. The built-up area of the smart warehouse complex must be at least 50,000m2 and equipped with at least three (3) enabling elements technologies under the IR4.0;
  3. Use the application of modern construction techniques i.e. achieving a score for the Industrial Building System (IBS) that has been set by the Construction Industry Development Board (CIDB)
  4. Total full-time workforce must consist of at least 80% Malaysian citizens;
  5. A minimum of 30% of total high-value positions (with a minimum basic salary of RM10,000) shall be filled by full-time Malaysian employees.
5.
Flagship D (Tanjung Langsat – Kong-Kong)

Manufacturing – Downstream Specialty Chemicals
Eligible product(s) / activity(ies):
a. Base Chemicals;
b. Organic intermediates C1 to C6
c. Specialty chemicals;
d. Fertilizers;
e. Polymers / Plastics;
f. Oleo chemical / Biochemical.
Special tax rate of 5% or 10% for a period of up to 10 years, for A company with capital investment (excluding land) of RM500 million and above in the manufacturing sector; OR
60% or 100% Investment Tax Allowance (“ITA”) on eligible capital expenditure (excluding land cost) for a period of 10 years.

Eligibility Criteria / Conditions
  1. A new company or an existing company undertaking diversification activities in relation to the eligible activities / products under this cluster;
  2. The company is required to have a minimum paid-up capital of RM2.5 million at the point of submission of application to MIDA;
6.
Additional Incentives
  1. 440% stamp duty exemption on the instrument of transfer/ financing agreement for the purchase of a commercial property in Flagship A and B that remains unsold as at 31st December 2024. The stamp duty exemption to be provided under Section 80(1) under the Stamp Act 1949;
  2. A deduction equivalent to amount not exceeding RM1 million for each year assessment in respect of cash contribution or contribution in-kind by qualifying person who sponsors a hallmark event.
  3. The hallmark event referred to is an event of regional or international significance which is carried on in Flagship G and supported/ verified by MOTAC. For contribution made between 1 January 2025 to 31 December 2034.
  4. ACA in respect of renovation costs incurred on a building or part of a commercial building located in Flagship A-G for the purpose of qualifying company’s business. Qualifying companies are companies that have been approved any tax incentives under PIA 1986 or ITA 1967 between 1 Jan 202 – 31 December 2034 and operating in Flagship A-G. This incentive to be utilized only once throughout their business operation in JS-SEZ.

To include expenses on:
  • General electrical installation
  • Lighting
  • Gas system
  • Water system; Kitchen fittings
  • Sanitary fittings
  • Door, gate, window, grill and roller shutter
  • Fixed partitions
  • Flooring (including carpets)
  • Wall covering (including paint work)
  • Incentives & Eligibility Criteria
  • False ceiling and cornices
  • Ornamental features or decorations excluding fine art
  • Canopy or awning
  • Recreation room for employee
  • Air-conditioning system
  • Day care centre for employees’ children
  • Surau
  • Reception area
  • Green elements, smart solutions systems
Initial Allowance: 20%, Annual Allowance: 40%

B. Special Tax Rate for Knowledge Workers:

A special tax rate of 15% for a period of 10 years is provided for eligible knowledge workers in all Flagships.

Eligibility Criteria / Conditions:

  1. Malaysian/Non-Malaysian citizen;
  2. Not generating employment income in Malaysia 24-months prior;
  3. Salary abroad/in Malaysia >RM20,000 per month.
  4. Subject to academic qualifications / years of professional work experience
  5. Subject to MyCOL profession and JS-SEZ qualifying sectors
Source: MIDA guideline

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Family Office Incentive Scheme in Forest City Free Trade Zone (FCFTZ)

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Family Office Incentive Scheme in Forest City Free Trade Zone (FCFTZ)

First location in Malaysia which provide 0% concessionary tax rate for family offices. This incentive is valid for an initial period of 10 years and an additional 10 years with further conditions.

Forest City Special Financial Zone (FCSFZ)

Following amendment bills were tabled and passed by House of Parliament in July 2024 and gazetted on 3 Oct 2025, FCSFZ is first onshore duty-free zone and special financial zone in Forest City, Johor, Malaysia.

Pulau Satu, Forest City is the first location in Malaysia to offer a zero (0%) percent tax rate for Family Office established under the Single Family Office Scheme.
forest city location map

Source: https://forestcitycgpv.com

Single Family Office (SFO) & Single Family Office Vehicle (SFOV)

What is Single Family Office (SFO)?

  1. SFO is a corporate vehicle;
  2. Wholly owned or controlled by members of a single wealthy family;
  3. Created to exclusively manage the assets, investments and long-term interests of that family;
  4. SFO may also represent multiple generations and branches of the family.

What is Single Family Office Vehicle (SFOV) ?

  1. SFOV is a corporate vehicle;
  2. Wholly owned or controlled by members of a single wealthy family;
  3. Established solely for the purposes of holding the assets, investments and long-term interest of members of the single family.

SFO vs SFOV

FCFTZ-image

Key Conditions on SFOVs Tax Incentives

SFOV must be incorporated in Malaysia, preregistered with the Securities Commission (SC), and operating in Pulau Satu, FCSFZ to be eligible for zero (0%) Concessionary Tax Rate for first initial 10 years + additional 10 years. The below conditions are also required to be fulfilled during the incentive periods.

Conditions

First 10 Years
Additional 10 Years
1. Minimum AUM

RM30Mil (*USD7Mil)

RM50Mil (*USD11.5Mil)

2. Minimum Domestic Investment in Promoted Activities
At least 10% of AUM or RM10Mil (*USD2.3Mil), whichever is lower
At least 10% of AUM or RM10Mil (*USD2.3Mil), whichever is higher
3. Minimum local operating expenditure per annum
RM500,000 (*USD115,000)
RM650,000 (*USD150,000)
4. Minimum full time employees
Two (2) and each with a minimum monthly salary of RM10,000 and of whom at least one (1) is an investment professional.
At least 4 full-time employees.
5. Physical Office
Pulau 1, Forest City SFZ min 450 square feet.
Pulau 1, Forest City SFZ min 450 square feet.
*1 USD = 4.32740 MYR

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Green Investment Tax Allowance (GITA) For Own Comsumption

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MALAYSIA GREEN INVESTMENT TAX ALLOWANCE (GITA) FOR OWN COMSUMPTION

Companies undertake in green technology project for own consumption may enjoy up to 100% Green Investment Tax Allowance (“GITA”) to be offset against 70% of statutory income. Promoted activities such as green building, renewable energy system, energy efficiency, battery energy storage system, electric vehicles etc.
In 2024 Budget, the green technology tax incentives have been revised to the following categories:
  • Green Investment Tax Allowance (GITA) Project for Business Purposes;
  • Green Investment Tax Allowance (GITA) Asset for Own Consumption; and
  • Green Income Tax Exemption (GITE) Solar Leasing
The Malaysian Green Technology and Climate Change Corporation (MGTC) has issued a new guideline for GITA for own consumption project as below:

(i) Investment Tax Allowance :

Tier 1
Tier 2
Qualifying Activities
Qualifying asset as approved by Minister of Finance, Battery Energy Storage System (BESS) and Green Building.
Qualifying asset as approved by Minister of Finance (Appendix 11), Renewable Energy System and Energy Efficiency (Appendix 2).
Percentage of GITA
100%
60%
Percentage (%) of Statutory Income to be Set-Off
70%
70%
Qualifying CAPEX
  • The qualifying capital expenditure must be an approved asset by MOF that have been verified by MGTC and is listed under the MyHIJAU Directory;
  • For Green Building, the qualifying CAPEX must be verified by the locally Green Building Rating Tools/ Certification Body approved by Government;
  • The asset must be new and owned by the Company;
  • The asset must be used in the business carried out by the company in Malaysia for own consumption and not for income generation.
Qualifying Asset
  • Electric vehicles (for commercial / industrial used only);
  • EV Infrastructure;
  • Green Building;
  • Energy Storage
  • Energy Efficiency;
  • Renewable Energy System;
  • Waste Composter or waste recycling;
  • Wastewater recycling or rainwater harvesting
Incentive Period
Qualifying Capital Expenditure incurred starting from 1 January 2024 until 31 December 2026.
Application Period
The application made under the GITA Asset Guidelines must be received by the Malaysian Green Technology and Climate Change Corporation [“MGTC”] from 1st January 2024 until 31st December 2026.

(ii) Eligibility Criteria:

a) New or existing Company:
  • A newly established company that incurred qualifying capital expenditure under GITA Asset; OR
  • Existing Company operating in Malaysia but has not incurred qualifying capital under GITA Asset and has not been approved for Green Technology Incentive.
b) Companies within the same group incurring the qualifying capital expenditure:
  • The project carried out in building/location separately from activities carried out by holding company or related companies;
  • The plant, machinery and equipment used shall be separately used and shall not be transferred from holding company or related companies;
  • Not shares the same employees as per holding company or related companies except for the management staff and directors of the Company;
  • This project must not result in a reduction in the investment of holding company or related companies.
c) To comply all the following criteria:
  • Minimize the degradation of the environment or reduce greenhouse emission;
  • Promotes health and improvement of environment; and
  • Conserves the use of energy, water and/or other forms of natural resources or promote the use of renewable energy or able to recycle waste material resources.

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Malaysia Cold Chain Facilities

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Malaysia Cold Chain Facilities

Investment in cold chain facilities or providing services for perishable agricultural produce such as fruits, vegetables, flowers, ferns, meat and aquatic products eligible for tax exemption up to 70% of statutory income or Investment Tax Allowance of 60% up to 5 years.

Companies providing cold chain facilities and services for perishable agricultural products i.e. fruits, vegetables, flowers, ferns,
meat and aquatic products are eligible for:

Type of Company
Incentive
New Company

  • Pioneer Status with tax exemption of 70% of statutory income for a period of
    5 years;

  • Unabsorbed pioneer losses after the end of pioneer period are allowed to be
    carried forward for 7 consecutive year of assessments;

    OR

  • Investment Tax Allowance (ITA) of 60% on the qualifying capital expenditure
    incurred for 5 years;

  • Unutilised allowances can be carried forward until fully absorbed.

Existing Company
(Company intend to reinvest in cold chain facilities for perishable agricultural produce)
  • Pioneer Status with tax exemption of 70% of increased statutory income for
    a period of 5 years;
  • Unabsorbed pioneer losses after the end of pioneer period are allowed to be
    carried forward for 7 consecutive year of assessments;

    OR

  • Investment Tax Allowance (ITA) of 60% on the additional qualifying capital
    expenditure for 5 years;
  • Unutilised allowances can be carried forward until fully absorbed.
Eligible Company
Eligible Activities
  • Must be Independent Service Provider (i.e the company conducts all of the cold chain activities on its own);
  • At least 60% of the company’s revenue must be derived from the provision of cold room facilities, refrigerated transportation and other related services for local agriculture produce.
  • Provision of cold room facilities or refrigerated transportation for local agricultural produce with or without other post-harvest activities including cleaning, washing, grading, freezing/chilling and packing;
  • Provision of cold room facilities or refrigerated transportation for local processed food products.

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