AN INTRODUCTION TO LEASING IN LABUAN
Over the years, Labuan International Business and Financial Centre's (Labuan IBFC) leasing sector has grown in tandem with the region's economic growth, as demand for capital equipment has showed no sign of abating in order to meet the demands of a developing region.
The ease through which leasing transactions can be structured, along with access to a highly efficient tax framework has no doubt worked in Labuan IBFC's favour as it is now home to more than 400 leasing companies, all of which are reaping the benefits of structuring leasing arrangements via Labuan IBFC. Companies from the oil and gas industry, airlines, shipping and other large corporations are structuring their leasing arrangements via Labuan IBFC's efficient tax regime and business-friendly regulatory environment.
Regulated and licensed by Labuan Financial Services Authority (Labuan FSA), Labuan leasing companies enjoy an ideal balance of fiscal neutrality and certainty, allowing for effective management of their operational cost.
In addition, it is cost-efficient to create economic substance on Labuan island, where there is a large English educated population and an extensive array of services providers.
WHY LABUAN IBFC?
It has one of the most competitive and flexible fiscal regimes in Asia. It boasts a modern suite of robust legislative provisions. It has been declared as a white-listed jurisdiction by the Organisation of Economic and Co-operation and Development (OECD) and complies to all international provisions on effective exchange of tax information and transparency. It has access to the Malaysian Double Taxation Network spanning more than 80 countries. It is strategically located in the heart of Asia Pacific, sharing its time zone with many major Asian cities. As part of Malaysia, Labuan is a member of the ASEAN trade bloc, including the ASEAN Economic Community. Labuan Financial Services Authority as the single supervisory and regulatory authority. It offers an international ship registry for foreign-owned ships in Labuan. It is home to the world's first omnibus Islamic Finance legislation which encompasses all requirements for Shariah-compliant financial services, including Shariah-compliant leasing solutions (known as Ijarah). Has in place stringent anti-money laundering and counter-terrorist financing regulations. THE BENEFITS OF SETTING UP A LABUAN LEASING STRUCTURE
Leasing activities fall within the...