Offshore Financial Center

The Labuan International Business and Financial Centre (Labuan IBFC) was created as an offshore financial hub on October 1990 and was operating under the name of Labuan International Offshore Financial Centre (IOFC). At the time it was established to strengthen the contribution of financial services to the Gross National Products (GNP) of Malaysia as well as to develop the island and its surrounding vicinity. The jurisdiction, under the robust but progressive regulatory body called Labuan Offshore Financial Services Authority or LOFSA, offers benefits such as 3% tax on net audited results or a flat rate of Malaysian Ringgit (MYR) 20,000 to trading companies; low operational costs; liberal exchange controls; and a host of other advantages including readily available, experienced and professional service providers.

Labuan IBFC is Malaysia’s only offshore centre, strategically located on Labuan island off the north west coast of Sabah which is itself part of the Borneo land mass. Since its inception, the jurisdiction has developed by leaps and bounds such that today, it is home to more than 6,500 offshore companies and more than 300 licensed financial institutions including world leading banks. Supported by a well-developed infrastructure that includes modern amenities as well as a full range of service providers for the business community, Labuan IBFC is embarking on an aggressive growth strategy to become the premier international business and financial centre in the Asia Pacific region.

There are five core areas that Labuan IBFC intends to focus on, leveraging on its key strengths. These five are offshore holding companies, captive insurance, Shariah-compliant Islamic Finance structures, public and private funds and wealth management. Given the burgeoning interest around the world in Islamic finance, Labuan IBFC is well placed to enhance its lead as an Islamic financial hub. Labuan IBFC’s position is further enhanced by the formation of the Malaysian International Islamic Finance Centre initiative that was launched in August 2006.

The Labuan Financial Exchange or LFX was officially launched on 23 November 2000 and offers a global exchange with listing and trading facilities for a wide range of financial and non financial products.