Labuan – a regulated gateway to global broking

Labuan is Malaysia’s international financial centre and is increasingly becoming one of the most attractive jurisdictions for companies seeking a Money Broking licence and aiming to operate on a global scale.

Against the backdrop of growing regulatory pressure and the high cost of entering major international markets, Labuan stands out as an alternative offering clear rules, a fast licensing process, and a transparent tax model. As a result, it is one of the few international financial centres that approaches fintech and broking in a systematic and commercially realistic way, with a clear understanding of industry dynamics.

How the regulator operates

The Labuan Financial Services Authority (Labuan FSA) has built a strong reputation as a fast and well-structured regulator. Unlike many European regulators, where licensing processes can turn into prolonged bureaucratic exercises, Labuan FSA operates efficiently, with licences typically issued within 8–16 weeks.

The regulatory framework is designed to minimise risks for applicants:

the licence application is submitted first,
following conditional approval, the company is incorporated,
bank accounts are opened and economic substance requirements are fulfilled.

This approach makes the process not only efficient but also predictable – a key factor highly valued by international brokers, payment institutions, and fintech companies.

Capabilities of the Money Broking Licence

The Labuan Money Broking licence is designed for businesses operating with international capital flows. It is not a local brokerage licence, but rather a tool for cross-border operations without geographical limitations.

A licensed company may:

conduct foreign exchange broking,
act as an intermediary between financial institutions,
execute international FX transactions,
work with derivatives and complex financial instruments,
provide OTC operations and multi-currency services.

The core principle is that all activities must be cross-border in nature, enabling access to markets across APAC, the Middle East, Europe, and Africa.

To qualify for the preferential tax regime, a company must ensure:

at least 2 employees in Labuan,
a physical office or dedicated workspace,
a minimum operational budget.

Money Broking Licence application process

The standard licensing pathway consists of six key steps:

Preparation of documentation. Business plan, AML/CTF policies, information on directors and shareholders, and a detailed description of the operating model.
Submission to Labuan FSA. The regulator assesses the reputation of beneficial owners, compliance of internal processes, and the quality of AML frameworks.
Conditional Approval. Confirmation that the proposed business model is acceptable.
Company incorporation in Labuan. Typically completed within 2–4 business days after submission of complete documentation.
Opening bank accounts in Labuan or Malaysia. Required for operational activity and handling client funds.
Final licence issuance and commencement of operations

Where required, a company may also establish a Marketing Office to promote its services within Malaysia.

Support Ecosystem – from audit to banking

Labuan has developed a comprehensive ecosystem supporting regulated businesses at every stage:

experienced auditors working exclusively with licensed financial institutions,
accounting firms familiar with FX, OTC, and fintech operations,
banks experienced in servicing international corporate structures,
professional advisors assisting with Form LMB and supporting documentation (Appendices II–V).

This allows companies to focus on growth and operations rather than procedural challenges.

Conclusion

The Money Broking licence in Labuan represents a strategic opportunity for FX and OTC companies, fintech firms, and brokers seeking to operate globally in a fast, compliant, and cost-efficient manner.

Planning to launch a global financial business? IFB provides end-to-end support – from infrastructure and licensing to operational launch.