Foreign shareholding remains limited to 30% in fund management companies managing real estate investment trusts. Since January 2019, foreign shareholding in companies managing exchange-traded funds is no longer limited to 49%. No other regulated activity under the Capital Markets and Services Act 2007 is subject to foreign equity restrictions.
"[...] 35. Alongside action on transparency, sustainability and innovation, we are also looking to make our financial markets more inclusive and more accessible.[...]
39. So to build that capacity – and to further promote investment in a broader spectrum of assets – I am pleased to announce the following liberalisation measures:
40. First, the mandatory requirement for credit ratings will be removed, effective 1st January 2017. This will broaden the corporate bond market, and enable investors to further diversify their portfolios.
41. A gradual approach is being adopted to provide industry players sufficient time to further refine mechanisms necessary to operate under the new regime. From 1st January 2015, flexibilities will be accorded with regards to credit ratings and the tradability of unrated bonds and sukuk.
42. Secondly, the equity shareholding for credit rating agencies will be liberalised, and international credit rating agencies with full foreign ownership will be allowed in the Malaysian market from 1st January 2017.
43. The entry of international agencies will further enhance the quality and standard of rating services, introduce a more competitive fee structure, and widen both expertise and the range of credit rating services on offer. Ultimately, this liberalisation will enable the Malaysian bond market to become a more cost-effective and attractive long-term financing platform.
44. Malaysia's financing capabilities are underpinned by the market's ability to mobilise latent domestic savings. Unit trust funds have played a critical role in this respect. As a result, Malaysia's unit trust industry witnessed double-digit growth over the past decade, emerging as the largest in ASEAN, with net asset value of 344 billion ringgit, equivalent to almost a fifth of stock market capitalisation.
45. Last year, in recognition of the significant opportunities for further growth in the region, the Securities Commission Malaysia, together with the Monetary Authority of Singapore and the Securities and Exchange Commission of Thailand, signed the memoranda of understanding to enable fund managers from these three jurisdictions to offer collective investment schemes to retail investors within the signatory countries. This measure aims to facilitate greater cross-border offerings of investment funds, and bring the region yet another step closer to an ASEAN passporting regime.
46. In the spirit of the ASEAN Economic Community, and to further encourage growth and competition within the unit trust industry, I am pleased to announce today that the equity shareholding for unit trust management companies will also be liberalised.
47. With immediate effect, foreign corporations will be allowed to own 100 percent of shares in unit trust management companies, and there will be no barrier to entry for new foreign unit trust management companies coming into Malaysia. We believe this measure will make a wider range of competitive products available to investors, and increase competition in the sector. [...]" (Prime Minister's speech at Invest Malaysia 2014, 9 June 2014).
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"Chapter 1  - INTRODUCTION
1.01 The Capital Markets and Services Act 2007 (CMSA) repeals the Securities Industry Act 1983 (SIA) and the Futures Industry Act 1993 (FIA). The CMSA, which takes effect on 28 September 2007, introduces a single licensing regime for capital market intermediaries. Under this regime, a capital market intermediary will only need one licence to carry on the business in any one or more regulated activities. This will mean less cost and paperwork for capital market intermediaries that carry on more than one regulated activity.
[...]
2.02 What are regulated activities?  
(1) There are eight types of regulated activities under the CMSA. The list of regulated activities is set out in Schedule 2 of the CMSA. They are– - dealing in securities; - dealing in derivatives; - clearing for securities or derivatives; - fund management; - dealing in private retirement schemes; - advising on corporate finance; - investment advice; and - financial planning.  
(2) The licence issued under the CMSA will set out the specific regulated activities that you can conduct. 
[...]
Chapter 4 -  LICENSING CRITERIA [...]
In authorising any person wishing to undertake capital market activities6, the SC will not grant authorisation unless the application is in the best interest of Malaysia. In determining the best interest of Malaysia, the SC will give regard to any one or more of the following: [...] (e) The degree and significance of participation of Malaysians in the capital market. 
[...]
What are the requirements for a CMSL? 
4.02 Organisational requirements
Incorporation
(1) If you want to carry on any of the following regulated activities, you must be a company incorporated in Malaysia: - Dealing in securities;  - Dealing in derivatives; - Clearing for securities or derivatives; - Fund management; - Dealing in private retirement schemes; - Advising on corporate finance; and - Investment advice. 
(2) However, if you want to carry on the regulated activity of financial planning, you may do so either as a company, sole proprietorship or partnership. If you are a sole proprietor or in a partnership, you will be granted a CMSL but you will not be allowed to have any licensed representative acting on your behalf. 
[...]
4.03 Shareholder composition
(1) Except for the shareholding requirement for investment banks which is a minimum of 30% local shareholding, there are no other specific shareholding requirements for the other regulated activities.  [...]
(3) If you are a stockbroking company that is not an investment bank– (a) a person who wishes to acquire more than 51% of the total paid-up capital of a PO must be a company or corporation with shareholders' funds of not less than RM100 million; and (b) no individual other than a Malaysian citizen, may hold up to 10% of the total paid-up capital of a stockbroking company. The aggregate total participation of individuals in the share capital of the stockbroking company shall not be more than 49% of the total paidup capital. [...]" (Securities Commission (2023), Licensing Handbook, April 14)
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"Chapter 3 - THE MANAGEMENT COMPANY
3.01 A management company is a company that– (a) establishes a fund; (b) issues, offers for subscription, makes an invitation to subscribe for or purchase, units of the fund; and (c) operates and administers the fund.
3.02 A management company must– (a) be an entity incorporated in Malaysia; and (b) have a minimum shareholders' funds of RM10 million at all times. [...]" (Securities Commission (2022), Guidelines on Unit Trusts Funds, November 28)
--------------------------------
"Chapter 3 - THE MANAGEMENT COMPANY
General 
3.01 For the purpose of these Guidelines, a management company is a company that –  (a) establishes a REIT;  (b) issues, offers for subscription, makes an invitation to subscribe for or purchase units of the REIT; and  (c) operates and manages the REIT.  
3.02 A management company must– (a) be an entity incorporated in Malaysia; and  (b) hold a CMSL for the regulated activity of fund management in relation to asset management restricted to REITs. [...]" (Securities Commission (2022), Guidelines on Listed Real Estate Investment Trusts, November 28)
--------------------------------
"Chapter 1 - INTRODUCTION
1.01 The Guidelines on Real Estate Investment Trusts is issued by the SC under section 377 of the Capital Markets and Services Act 2007 (CMSA). These guidelines set out requirements to be complied with by any person intending to establish a conventional or Islamic unlisted real estate investment trust in Malaysia and issue, offer or invite any person who falls within the category of sophisticated investors to subscribe for or purchase units of the conventional or Islamic unlisted real estate investment trust
1.01A The new Guidelines on Listed Real Estate Investment Trusts issued on 15 March 2018 has superseded all requirements in relation to listed real estate investment trusts in these guidelines.
[...]
Chapter 3 - THE MANAGEMENT COMPANY
[Appointment of Management Company]
3.01 As prescribed under sections 288(2) and 289(1) of the CMSA, only a management company approved by the SC can act as a management company to a real estate investment trust.
3.02 A management company is a company that– (a) establishes a real estate investment trust; (b) issues, offers for subscription, makes an invitation to subscribe for or purchase units of the real estate investment trust; and (c) operates and administers the real estate investment trust [...]
[Eligibility Requirements]
3.04 A management company must– (a) be an entity incorporated in Malaysia;[...] (c) have a minimum of 30% local equity; and (Amended on 13 July 2011); [...]"(Securities Commission (2022), Guidelines on Real Estate Investment Trusts, November 28)
--------------------------------
"Chapter 3- THE MANAGEMENT COMPANY
General
3.01 A management company is a company that– (a) establishes an ETF; (b) issues, offers for subscription, makes an invitation to subscribe for or purchase units of the ETF; and (c) operates and manages the ETF.
3.02 A management company must be the holder of a CMSL for the regulated activity of fund management in relation to portfolio management. [...]" (Securities Commission (2022), Exchange-Traded Funded Guidelines, November 28)
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Previously: until Jan-2019
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"Chapter 3: THE MANAGEMENT COMPANY [...]
Eligibility requirements
3.04 A management company must– (a) be an entity incorporated in Malaysia; (b) have a minimum of 30% Bumiputera equity; (c) have not more than 49% foreign equity; and (d) have minimum shareholders' funds of RM10 million at all times; [...]" (Securities Commission (2009), Guidelines on Exchange-Traded Funds, June 11)
Prime Minister's speech at Invest Malaysia 2014, 9 June 2014
Securities Commission (2023), Licensing Handbook, April 14
Securities Commission (2022), Guidelines on Unit Trusts Funds, November 28
Securities Commission (2022), Guidelines on Listed Real Estate Investment Trusts, November 28
Securities Commission (2022), Guidelines on Real Estate Investment Trusts, November 28
Securities Commission (2022), Exchange-Traded Funded Guidelines, November 28
Securities Commission (2009), Guidelines on Exchange-Traded Funds, June 11.
[<a href="n/a">Speech</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=2bb1b664-aa03-425e-9472-9cc5b1558ed1">Handbook</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=2ffbdcb5-443b-45c3-9e63-8776591991fe">Guidelines</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=ad5d52fc-4eb6-4184-b4e7-d341d4781086">Guidlines</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=4b41c93b-3752-4309-b773-6f2b402203d2">Guidelines</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=0957b33a-9afb-466b-865c-92e713b82af4">Guidelines</a>],[<a href="https://www.sc.com.my/api/documentms/download.ashx?id=f9fcc4b8-3829-4835-bcfa-56c0bdecb011">Guidelines</a>]