FIC GUIDELINES TO PROVIDE GREATER FLEXIBILITY

(sourced from NEW STRAITS TIMES, DATED MAY 22, 2003, B1(BUSINESS TIMES)

According to the new strategies announced by the Government to stimulate Malaysia's economic growth, the move will further enhance the nation's competitiveness in attracting foreign direct investment.

For acquisition by Malaysian and foreign interest, the only equity condition imposed will be Bumiputera equity of at least 30 per cent.

In the case of acquisition by foreign interest, the remaining equity can be held either by foreign interest or jointly by foreign and Malaysian interests.

The requirement of at least 30 per cent Bumiputera equity participation will be applied by all ministries except where exemption have been granted by the Government.

Processing of proposals by licensed manufacturing companies will be centralized at the Ministry of International Trade and Industry (MITI), and of corporate proposals at the Securities Commission.

These proposals will be no longer require the FIC's consideration.

For companies seeking listing on the Kuala Lumpur Stock Exchange (KLSE), Bumiputera equity participation must be at least 30 per cent upon listing.

The foreign equity condition, meanwhile, will be liberalized to attract more foreign companies to be listed on the KLSE in line with the Capital Market Master plan.

In addition, foreign interests will be allowed to acquire landed properties exceeding RM150,000 per unit.

For acquisitions exceeding RM100 million, companies can apply for exemptions from the FIC guidelines, subject to the approval of the Finance Minister and on a case-by-case basis.

This exemption is given for applications received before May 31, 2004.

back