License To Open A Restaurant In Malaysia

If you want to open a restaurant in Malaysia, you must have a license to operate your business.

This article explains the mandatory and additional licenses that are often required to open a food and beverage (F&B) outlet in Malaysia.

For each license, we will discuss:

  • waiting period,
  • the government body that issues the license, and
  • best practices or additional considerations

Please note that you need to register an Enterprise or Sdn Bhd company first because registration documents are required to apply for a licence.

Let’s start!

License is mandatory

Whether you plan to serve fried rice or gold-plated crayfish, all restaurants require a valid premises license and signage.

Premises License & Signs

This license is issued by the Local Authority (also known as PBT) that controls the specific area.

This license proves that your premises meet PBT health and safety standards and that your signage gives an accurate impression to the public.

Requirements

The following are the requirements that must be met to obtain an F&B premises license:

  • Have SSM business registration documents
  • Attend a food handling course approved by the Ministry of Health
  • Receive typhoid shots for you and the staff
  • Pass the premises inspection by officers from the Local Authority

Each PBT has slightly different security, pest control, customer amenities, location, and even interior design specifications. For example, there are local authorities that require different types of flooring for air conditioned spaces!

The best way to pass a premises inspection is to talk to a business advisor, call the relevant PBT, or obtain an official checklist from an online source.

Application period, validity period & cost

Allow between two to four weeks from the date of application for the Local Authority to issue your premises license and sign.

This license is normally valid for one year from the date of issue and can be renewed for another 12 months with each renewal.

Some local authorities use a prorate system based on the calendar year so the license expires on December 31 regardless of when it was issued and you are only charged for the number of months the license is active.

The license price also depends on the size and location of the restaurant.

Take DBKL as an example

1. Restaurants, coffee shops, food stalls, milk bars, snack bars, bars, public houses, canteens and cafeterias:

(a) dining area not exceeding 90 square meters (RM200 per year)
(b) dining area does not exceed 120 square meters (RM300 per year)
(c) dining area exceeding 120 square meters (RM400 per year)

2. Food court (RM200 per year)

3. Food stalls in licensed premises (RM100 per year)

You can refer to DBKL’s official website for more information, but be reminded, it is only for premises located within DBKL’s jurisdiction.

Additional licenses

These licenses are not required for normal restaurants, but if you want to open an unusual restaurant, the Malaysian government requires additional licenses according to the activity.

1. Public House License

Authority: Local Authority

If you plan to sell alcoholic beverages to drink on the premises, then you need to apply for a Public House License from your local authority. You must comply with certain restrictions, such as:

  • pass an interview with the police (determining you do not sell illegal alcohol)
  • make sure the premises are within a certain distance from mosques, schools, or Muslim majority residential areas

2. Halal certificate

Authority: Malaysian Islamic Development Department (JAKIM)

If your main target is Muslim customers, a Halal certificate can give you an advantage over restaurants that do not have this certificate. This is because Malaysia is one of the countries with the strictest Halal requirements.

After applying, JAKIM officers will inspect your premises and may take samples for laboratory testing (under your umbrella!). The fee for the restaurant is RM200 per premise, and the Halal certificate is valid for 2 years.

3. Music and Entertainment License

There are two related activities that require separate licenses:

3.1 Music Authors Copyright Protection (MACP) License

Authority: Malaysian Employee Rights Protection Agency (MACP)

If you want to play K-pop songs to attract customers, you have already made a profit from the artist’s music and need to buy a license from MACP.

For restaurants, the fee ranges from RM 847 to RM1,376 and is valid for one year.

Recording of songs and ‘live’ performances (by DJs or karaoke customers) are charged separately.

3.2 Public Performance License

Authority: Malaysian Employee Rights Protection Agency (MACP)

Live performances of copyrighted songs require an additional Public Performance Licence, also valid for one year at a price of RM1,200 – RM27,000 depending on the number of customers and whether the performance is the main attraction of the business.

4. Wholesale, Retail & Trade License (WRT)

Authority: Ministry of Domestic Trade (KPDN)

If you are a foreign national and plan to open a restaurant as a foreign owned business (more than 50% foreign owned) you need a WRT License which governs foreign involvement in trade in Malaysia.

It costs RM3,000, takes 1-3 months to be approved, and is valid for two years.

Alternatively, look for local shareholders or directors to avoid the need to apply for this license, and enjoy the benefits of being a legally recognized local business.

5. Personal Parking License

Authority: Local Authority

Let’s say your restaurant is in a busy area and there is vacant land nearby that could be used as a parking lot.

You will need to plan the parking layout as you would for the floor space in your restaurant and submit this to your Local Authority.

Again, officers will come to ensure parking meets standards.

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