Labuan IBFC’s strategic location enables investors to foster long-lasting business relationships with Asia’s emerging economies such as China and India. In addition, it lies in close proximity to major shipping routes and boasts excellent shipping support services and facilities.

The Malaysian International Ship Registry (MISR), introduced to attract individual or foreign shipping companies to register their ships through Labuan IBFC thereby bypassing the requirements for a Malaysian majority shareholder, is expected to further enhance the jurisdiction’s shipping operations.

Shipping operations include the transportation of passengers or cargo by sea or the letting or charter of ships on a voyage or time charter basis.

The Malaysia International Ship Registry (MISR) is a body for the registering of international ships. The MISR has been established to encourage individuals and foreign shipping companies to register their ships in Malaysia without having to comply with the requirements of a Malaysian majority shareholder. The MISR would enable the placing of Malaysia on the international maritime map.

Under the MISR, foreigners are allowed to hold 100 per cent equity in line with the government’s effort to encourage foreign investments in the country. With the registration of international ships, it would help increase the ship registry’s capacity in handling the country’s transportation trade.

Key Features of Malaysia International Ship Registry (MISR)

Port of Registry

The port of registry for a Malaysian international ship is Labuan.

Ship Owner Eligibility

The Registrar of Ships may register a ship as a Malaysian international ship, if it is owned by a corporation that satisfies the following requirements:

  1. Incorporated in Malaysia
  2. The office of the corporation is established in Malaysia; and
  3. The majority of the shareholding, including voting shares of the corporation are not held by Malaysian citizens.

Ship Manager Eligibility

The owner of a ship shall, before applying for a ship to be registered, appoint a ship manager who shall be:

A Malaysian citizen having his permanent residence in Malaysia; or

A company incorporated in Malaysia and having its principal place of business in Malaysia.

Vessel Age and Survey Requirements

No ship shall be registered under the MISR unless:

  1. It is fitted with mechanical means of propulsion
  2. It is not less than 1,600 gross tonnage; and
  3. The age of the ship is not more than 15 years if it is a tanker or a bulk carrier, or not more than 20 years if it is of a type other than a tanker or a bulk carrier.

Surveys are conducted by ship surveyors working under the direction of the Surveyor-General who may also authorize classification societies on his behalf.

Authorized Classification Society

The following are the recognized classification societies for the MISR:

  1. American Bureau of Shipping
  2. Bureau Veritas
  3. Det Norske Veritas
  4. Germanischer Lloyd
  5. Lloyd’s Register of Shipping
  6. Nippon Kaiji Kyokai.

Application for Vessel Name

An application must be submitted in writing to the Registrar of Ships to receive approval of the vessel’s name:

  1. Proposed name for a Malaysian vessel must be approved by the Register of Ships. Owners should apply for the vessel’s name at least 14 weeks in advance before the date at which the vessel is supposed to be registered.
  2. Three (3) names can be submitted for approval. An approved name is valid for a period of twelve months.
  3. Form “Application for Name of Ship” (MISR/BKI/01/05) is to be used.

The following relevant documents are also required to be submitted at this stage:

 

  1. Form “Appointment/Cancellation of an Authorized Officer” (MISR/BKI/03/05)
  2. Form “Application for Reserve Prefix/Suffix Name of Ship” (MISR/BKI/02/05)

Malaysia International Ship Registry (MISR) Advantages

  • Competitive entry cost and annual fee compared to other international ship registry jurisdictions.
  • The age of the ships or vessels qualified for the registration under the MISR must not exceed 15 years if it is a tanker or a bulk carrier, or not more than 20 years for any other type of vessels.
  • The ship must weigh not less than 1,600 gross tonnages and must be fitted with mechanical means of propulsion.
  • Foreigners are allowed to hold 100 per cent equity in the company owning the ship or vessel.
  • There is no restriction on the nationality of the crews. However, all crew must meet the standards of the International Convention on Standards of Training, Certification and Watch keeping for Seafarers (STCW) 1978.
  • Malaysia is a non-Flag of Convenience (‘FOC’) registry. Ships with a flags of convenience registry are likely to be targeted by the special enforcement of the countries visited by them.

The Valsen Advantage

  1. Speedy, Efficient and consistent Services.
  2. Relentless effort to obtain bank accounts.
  3. Expert advice on structuring options.
  4. Dedicated ongoing compliance support.