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Labuan International Business and Financial Centre

A Well-regulated Jurisdiction

Labuan IBFC, regulated by Labuan Financial Services Authority [Labuan FSA], has a comprehensive, modern and globally-recognized regulatory framework.

The jurisdiction’s adherence to international standards and best practices in financial services and prudential supervision, including protocols on anti-money laundering and exchange of information and regulatory requirements set by the Organization of Economic Co-operation and Development [OECD], reinforces Labuan IBFC’s commitment to ensuring a safe and secure business environment.

Modern Legislation

Labuan IBFC’s comprehensive regulatory framework provides for a broad range of legal entities including companies limited by shares or guarantee, foundations, special purpose trusts and protected cell companies. Insurance and insurance related businesses in Labuan IBFC are generally governed by the following modern Acts:

Labuan Business Activity Tax Act 1990

Labuan Companies Act 1990

Labuan Financial Services and Securities Act 2010

FATCA Compliance

Labuan FSA via a circular to all financial institutions reinforced the agreement in substance between the Malaysian Government and the United States Treasury reached in June 2014, towards the implementation of the Foreign Account Tax Compliance Act [FATCA] in Labuan IBFC. It is said that the agreement in substance will remain effective until a formal inter-governmental agreement is signed.

The Regulator

Labuan FSA was established on 15 February 1996 under the Labuan Financial Services Authority Act 1996. Labuan FSA is the statutory body responsible for the development and administration of the Labuan IBFC.

The objectives of Labuan FSA include the following:

To promote and develop Labuan as an international centre for business and financial services;

To develop national objectives, policies and priorities for the orderly development and administration of international business and financial services in Labuan; and

To act as the central regulatory, supervisory and enforcement authority of the international business and financial services industry in Labuan.

Labuan FSA’s key role is to license and regulate licensed entities operating within Labuan IBFC and to ensure all such entities remain in compliance with the internal and international best standards adopted by the jurisdiction. Labuan FSA also develops policies for the orderly conduct of business and financial services in Labuan IBFC.