LABUAN CREDIT TOKEN LICENSE

Big players with huge clientele database have started to shift themselves from the centralised to decentralised paradigm in the Blockchain space hence tokenising their business via the issuance of Initial Coin Offering (ICO) of their own ‘respective coin’ to increase market share as well as a strategy to promote new and upcoming products.

New start-ups with fund raising businesses are now adopting the blockchain technology instead of the conventional method through public stock markets or venture capital. New cryptocurrencies can be created via a number of different platforms and promoted as a public ICO targeted to retail investors to purchase the newly-minted digital tokens with other cryptocurrencies like Bitcoin and Ethereum. New business models such as tokenised credits in mobile application or huge retail stores, smart contracts for properties and blockchain-based ecosystems are best suited for tokenisation business.

Labuan offers Credit Token License to legalise your utility ICO making it regulated and safer to operate without violation of any laws. Low tax rate and affordable operational costs including the similar time zone for Asia Pacific regions, positions Labuan as one of the most sought-after jurisdictions which  complies with the Common Reporting System (CRS) including other international standards and regulations!

Labuan Credit Token For Initial Coin Offering

KEY ADVANTAGES OF A LABUAN CREDIT TOKEN LICENSE

  • 100% foreign ownership, Malaysian local partner not required
  • 3% corporate TAX on trading profit
  • NO Withholding Tax on Interest, Management Fee, Royalty Fee and Technical Fee
  • NO FOREIGN EXCHANGE CONTROLS
  • NO Stamp Duty and GST
  • NO Import Duty / Sales / Service Tax
 
  • NO Capital Gain Tax and Inheritance Tax
  • Ability to access to more than 70 Malaysia Tax Treaty partners
  • 50% tax abatement for expatriate professionals/managers’ employment
  • 100% tax exemption on director’s fees for foreign directors
  • NO tax on dividends to shareholders
  • 2-year multiple entry working visa (renewable) to stay in Malaysia - Optional

Eligible applicants include:

  1. All applicants must show at least three (3) years of good track record and relevant experience in the initial coin offering business
  2. Applicants will be required to register a Labuan entity in order to operate the Labuan licensed initial coin offering company with a paid-up capital of MYR 300,000

Qualifying Eligibility for A Labuan Initial Coin Offering License

  1. Individual or institution with initial coin offering expertise with a good track record and sufficient years of experience in the field
  2. Regulated initial coin offering or provider of such services from other jurisdictions with approval from home authority with the letter of consent
  3. Any licensed institutions including approved initial coin offering under the Financial Services Act 2013 with approval from the Central Bank of Malaysia

Regulatory and Operational Requirements for A Labuan Initial Coin Offering License

  1. Minimum paid up capital of MYR 300,000 (or equivalent) unimpaired by losses with a certificate of evidence from the banks within Malaysia and Labuan
  2. Must maintain an operational office in Labuan and all transactions must be done to, through and from Labuan
  3. Transact in foreign currencies of your choice, including Malaysian Ringgit (MYR)
  4. Transaction with Malaysian residents is permissible, including authorised dealers approved by the Malaysian Exchange Control
  5. Where technology client interface is deployed, any intrusions or malfunctions of the systems including adverse incidents discovered must be reported to Labuan FSA on the root cause and an impact analysis report is to be submitted within 14 days
  6. The company must appoint an approved external auditor to carry out an audit of business operations annually
  7. Maintain a separate account for clients’ monies and each transaction is to be marked clearly. All withdrawals are to be reported within 3 working days
  8. All written agreements and contracts with clients and any party are required to be documented
  9. Mandatory to observe and comply with the AML/CFT Act and Guidelines issued by Central Bank of Malaysia and Labuan Authority via the provision of a compliance officer
  10. Changes on shareholders, directors, office location, additional office outside Labuan and outsourcing arrangements require prior approval from Labuan FSA
  11. Yearly license fee payable to Labuan FSA is MYR 40,000 (approx. USD 10,000 or equivalent)

Important Documents for A Labuan Initial Coin Offering License Application

  1. A three (3) years Business Plan with its financial forecast and marketing strategies
  2. Profile of all Directors and Shareholders, including their qualifications
  3. Latest two (2) years Audited Accounts for current corporate company (if applicable)
  4. KYC, AMLA and Operations Manual / Procedures

Application Timeframe

  1. Approximately 30 to 60 days, subject to further information and supporting documents required by Labuan FSA during the approval process
  2. Interviews / Meetings with the key personnel may be requested by the Labuan FSA to understand or clarify certain processes

Annual Fees

Annual License Fee MYR 40,000
Marketing Office Fee
(optional)
MYR 7,500
Co-Located Office Fee
(optional)
MYR 10,000

The Annual License, Marketing Office, Co-Located Office fee are payable upon approval valid up to 31st December. For subsequent years, fees are to be paid on or before 15th January of each calendar year

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

QX TRUST license application service level for Labuan Initial Coin Offering license include:
  • Consultation of client's eligibility and application procedures
  • Feasibility study write-up based on client's profile
  • Due Diligence, Profiling and Guidance on documents preparation
  • Construct exclusive Business Plan to meet client's business objectives
  • Preparation of Financial Forecast, KYC, Operation and AML/CFT Manuals, Client Agreements etc
  • Submission and supervision of application process until approval
  • Act as liaison and key contact person for both client and Labuan FSA on all correspondences, meetings and /or interviews (if any)