Entrepreneurs from China advised to hire local experts to avoid pitfalls

The Malaysia-China Friendship and Mutual Aid Association (MCFAMAA) urges Chinese entrepreneurs who wish to establish companies in Malaysia to hire professional operational teams and study local laws to avoid being at a disadvantage in case of business disputes.

“The association has received several complaints from China businessmen who initially trusted local contacts to set up companies in Malaysia under their names. 

“However, due to various reasons, these relationships soured, and upon investigation, they found that their names were never included in the company documents,” said MCFAMAA president Ee Kah Fuk, reported Sin Chew Daily.

He added this led to the loss of their invested funds and the inability to gain operational control.

“If entrepreneurs from China encounter similar issues, they can contact the association or the Chinese Embassy in Malaysia for assistance,” he said. 

He stated that Chinese entrepreneurs facing such issues often find themselves at a disadvantage under Malaysian law and may struggle to win even if they go to court.

He noted that Malaysian and Chinese legal systems differ significantly, so Chinese entrepreneurs should study these legal differences before establishing a company in Malaysia and hire recognized and professional company secretaries, accountants, and legal advisors.

He said that depending on the situation foreigners can register companies under their own names without needing to use local names.