WHAT ARE THE OPERATIONAL REQUIREMENTS FOR A TRUST COMPANY?

A Trust Company is required to:

• Appoint at least two approved trust officers in Labuan, who can be employees of the manager, i.e. the Labuan trust company.
• Maintain separate telephone and facsimile lines for the company.
• Have its own letterhead and stationery.
• Keep all its books and records, and those of its clients, in Labuan IBFC.

WHAT ARE THE REGISTRATION REQUIREMENTS FOR TRUST COMPANIES?

A company that seeks to register itself as a Trust Company must be a company incorporated or registered under the LCA. The name of the company shall include the word ‘Trust’, ‘Trustee’ or other such words as approved by the Registrar. In addition, the company must comply with the following:

• Its authorised capital must be not less than MYR500,000 or its equivalent in any other foreign currency divided into shares of not less than MYR10 each or its equivalent in that foreign currency
• At least one half of the amount of every share issued by the applicant remains unpaid and is not liable to be called up except in the event and for the purpose of winding-up or dissolution
• At least MYR150,000 or its equivalent in any foreign currency of the authorised capital has been paid up
• The company has a professional indemnity insurance of not less than MYR1 million or its equivalent in any foreign currency or deposited with Labuan FSA securities to the value of MYR100,000
• The company is able to meet its obligations without taking into account the securities deposited with Labuan FSA
• The directors and officers designated as trust officers, who are responsible for the management of the Trust Company in Labuan, are fit and proper persons and remain as such throughout their appointment with the Trust Company

ARE THERE ANY SPECIFIC REQUIREMENTS RELATING TO TRUST OFFICERS?

Yes. A trust officer should be:

• An advocate and solicitor or a person who possesses a degree in law
• A member of the Malaysian Institute of Accountants or any other association of accountants approved by Labuan FSA
• An associate/fellow of any association of bankers, insurers, company secretaries or similar bodies
• A person who has had uninterrupted service of not less than ten years in any public service or statutory body
• Any other person comparable to the above

WHAT IS A MANAGED TRUST COMPANY?

A Managed Trust Company (MTC) is a trust company registered under the Labuan Companies Act 1990 (LCA), and is managed by a fully-operational Trust Company in Labuan.

The MTC is set up by a parent company to provide offshore trust services to its clients, while being managed by a third party (a local licensed Trust Company). This allows the parent company to extend its product offering to its clients without having to set up or maintain a presence in Labuan, thus avoiding the substantial expense and fixed costs of establishing, resourcing and equipping a new office.

In addition, the MTC would enjoy access provided by the managing company to specialists and experienced professionals who have existing relationships with local regulators, thus allowing the parent company to establish an offshore presence while maintaining its high standard of service.