Foreign law firms in Malaysia: extension of licence renewals

The validity of the qualified foreign law firm (QFLF) licence has been increased by the Malaysian Bar Council from three to five years for firms already operating in the market.

We’ve been pushing for this extension for several years, together with the UK Ministry of Justice and British High Commission Kuala Lumpur as part of the legal services working group, led by the UK’s Ministry of Justice.

The legal services working group is a part of the UK Malaysia Joint Economic and Trade Committee (JETCO).

How can UK law firms practise in Malaysia?

In 2014, Malaysia’s legal services market was officially opened to foreign lawyers and law firms.

English and Welsh law firms can apply for a QFLF licence to set up an office in Malaysia to advise on international law.

Firms must have experience and proven expertise on international Islamic finance.

Firms can also apply for a licence to operate an international partnership with a Malaysian firm and Malaysian firms can employ England and Wales-qualified lawyers.

What does this mean for you?

This change will apply to foreign law firms already operating in Malaysia as QFLFs when they renew their licence.

Foreign firms establishing in the country will continue to be issued with a three-year QFLF licence initially, but they will be issued with five-year licences following the first renewal.

This welcome development would provide further certainty for UK law firms looking to enter the Malaysian market.

Commenting on the extension, Law Society president Nick Emmerson said: “this is a welcome step forward being made by the Malaysian Bar Council.

“The previous three-year licence was a relatively short period for a foreign legal firm to realise its business plans and did not grant certainty to firms.

“Now they can enter in the knowledge that a three-year licence is no longer a permanent feature of practice in Malaysia. Instead, this period will turn to five once they reach the stage of renewals. This is welcome news for our members.

“In the meantime, we will continue to liaise with colleagues at the Malaysian Bar Council to address our member’s concerns around the existing licensing process, conditions and requirements.

"We are hopeful to be able to make positive progress in this direction in the coming months and continue to engage on areas of mutual interest.”