Open a HORECA Company in Malaysia

Updated on Monday 03rd June 2019

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HORECA represents the acronym describing businesses operating as hotels, restaurants and cafes. When referring to the HORECA market segment, it is necessary to know that the term also refers to the suppliers of goods necessary for these types of businesses (food, beverages and so on). As the term designates a wide range of business activities, we invite businessmen to request legal assistance from our team of consultants in company registration in Malaysia, who can advise on the specific incorporation requirements addressed to a given activity. 
 

What types of licenses are required for Malaysian hotels? 
 

Any HORECA company in Malaysia is required to apply for specific business licenses and permits. Restaurants and cafes have to apply for licenses that attest the fact that the food is handled, prepared, stored and served following the national health legislation, while hotels and other accommodation units in Malaysia have to obtain licenses, which depend based on their rating. Our team of consultants in company registration in Malaysia can provide full information on the process, which is comprised of the following: 
 
  • the main authority which regulates this sector is the Ministry of Tourism and Culture;
  • the institution has the right of verifying if the provisions of the Tourism Industry Act and the Tourism Vehicles Licensing Act are followed accordingly;
  • all accommodation units in Malaysia have to obtain the necessary licenses prior to starting their business activities;
  • the number of licenses required in a hotel in Malaysia depend on the types of activities that are carried out in the premises;
  • the main business license available in this case is the Tourist Accommodation Premises License
     
However, those opening a company in Malaysia as a hotel may also need to apply for a license which grants the right to sell alcoholic beverages, other ones for the right of building a pool inside the hotel’s premises, for building a parking lot, for indoor facilities and for operating a beauty salon. In the case of a 5 stars hotel, all the above mentioned types of licenses are necessary, as high rank accommodation units usually provide all types of services to their clients. 
 

What should one consider when opening a catering unit in Malaysia? 
 

As a foreigner opening a company in Malaysia that will operate as a catering unit (restaurant, café and other types of premises designed to offer food and drinks products), there are a number of aspects that should be considered. When entering this business sector, the investors should decide on matters such as: the design of the catering unit, its location, the menu, the marketing strategy followed in order to reach the target group and also the licensing requirements. 
 
A restaurant in Malaysia will need to obtain a set of licenses, depending on the types of activities it wants to start here. If the business will provide music events, a music license will be required. In the case in which the company is registered by a foreign investor, an additional license is requested under the local legislation, namely the Wholesale, Retail Trade License; our consultants in company registration in Malaysia can provide legal assistance on how to apply for this type of license. 
 

What are the characteristics of the accommodation industry in Malaysia? 
 

The accommodation industry in Malaysia, which includes a wide range of accommodation units, but which mainly refers to hotels, is a growing sector in this country. This can be seen in the total number of hotels that were built in the last decade. According to the information provided by the National Property Information Center, at the end of 2017, Malaysia had a total of 3,126 hotels accounting for a total of 246,564 rooms. 
 
This represented an increase of 8.58% compared to the previous year, when the country had 2,879 accommodation units. Compared to 2007, the accommodation industry increased by 41.77%. Most of the hotels registered in this country are located in Kuala Lumpur, the country’s capital city. The accommodation sector is developing in this country at a fast pace as Malaysia is one of the leading touristic destinations in its region. 
 
For example, at the level of the same year, 2017, Malaysia was the second most visited country in the South East Asia region and the traveling activities developed here accounted for 4.8% of the country’s gross domestic product (as mentioned by the World Travel and Tourism Council); investors can request advice on the legislation regulating companies operating in this sector from our team of specialists in company formation in Malaysia.  
 
Malaysian restaurants will need the Wholesale, Retail Trade License only when the restaurant has a specific concept, but there are also requirements concerning its minimum surface (of at least 1,500 square feet). Businessmen are invited to contact our team of specialists in company formation in Malaysia for further information on any matter related to the registration of a business operating in the HORECA industry