# Should a foreign company register a branch or a new Sdn Bhd?
URL: https://robocompanysecretary.com/answers/foreign-branch-vs-subsidiary/

## Should a foreign company register a branch or a new Sdn Bhd?

Last updated: 14 October 2026 Answer from Robo Company Secretary How we write answers

A branch is the foreign parent operating in Malaysia — the parent is fully liable for everything the branch does, and registration and filings are heavier. A subsidiary Sdn Bhd is a separate Malaysian entity: liability contained, cleaner banking, simpler Employment Pass sponsorship. Most foreign companies entering Malaysia choose the subsidiary unless regulation forces a branch.

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Sources: Companies Act 2016 (foreign company provisions)

Also asked as: register foreign branch malaysia; subsidiary vs branch; foreign company malaysia entity.

### Key facts

- Branch: parent fully liable, s.562 registration
- Subsidiary: separate entity, standard incorporation
- Subsidiary preferred for banking + EP

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