Industry Guide on How to Set Up a Private Transportation Services Business in Malaysia

Transportation is one of the inevitable aspects in the daily lives of people living in Malaysia. Thus, there is a high demand for transportation from Malaysians to facilitate their daily activities. The emergence of e-commerce has contributed to the revolution of the private transportation industry, as we can witness the success of companies such as Grab and MyCar.

Perhaps you can be the next top private transportation service business provider in Malaysia if you decide to join this transportation revolution.

Malaysia’s Private Transportation Business

Private transportation business is referred as transportation services designated for personal or individual use. Passengers will not have to squeeze for space among mass crowds on public transports as services are done through private booking procedures. The responsibility of private transportation business companies is to receive these bookings from clients and then arranging the correct mode of transportation according to their requirements.

Passengers have the flexibility to decide when and where they are going to travel thanks to private transports. Take a look at services provided Grab which is the most popular private transportation business in Malaysia. Nevertheless, the fees of private transportation services are higher compared to public transports due to its nature.

Also, private transport is not merely limited to these categories. In Malaysia, the different private transportation business categories are as the following:

  • Rental of Vehicles for Events: Company trips, school trips, weddings, party bus, minibus charter.
  • Corporate Services: Executive ride shares, limo services, airport transfers.
  • Miscellaneous Services: School bus, delivery services, e-hailing cabs, private hotel tours.

The type of vehicles decided by the company to provide services can range from a wide variety, including bicycles, motorcycles, scooter, recreational equipment, and even sailboats and private jets!

The Business Registration Process

In order to be recognized as a legal business entity in Malaysia, you must proceed the registration process with the SSM along with relevant documents. The company should have at least two directors with the minimum age of 18 years old and above as well as residing in Malaysia, while they do not possess any bankruptcy history.

Moving on, here listed down are the business entity options in Malaysia to choose from:

  • Sole Proprietorship
  • Partnership or Limited Liability Partnership (LLP)
  • Private or Public Limited Company (Sdn. Bhd. Or Berhad)
  • Companies limited by guarantee

Sole proprietorship or an LLP is considered the easiest to set up with the least investment. As business is operated in Malaysia, a Malaysian business address, business insurance and a corporate bank account is required. Registration of company tax can be done via Inland Revenue Board of Malaysia’s (LHDN) online portal. Moreover, it is recommended that you allocate investment in website and application design and development, in order to grab the attention of customers towards your services.

Licenses and Permits for Private Transportation Businesses

In spite of business license in Malaysia be either general or industry-specific, it is necessary to retrieve approvals before operating your business. In terms of transportation businesses, these are the relevant license and permits required:

  • Car rental and vehicle leasing license from Land Public Transport Comission (APAD).
  • All drivers under company possesses Vocational Driving License (VDL) or Commercial Driving License.

(For more information, please refer to Road Transport Department (JPJ)

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