A Guide to Labuan Limited Partnership and Labuan Limited Liability Partnership

An LP consists of at least one general partner (who manages the business) and one limited partner (who provides capital but doesn’t manage operations). This structure allows up to 50 partners and offers limited liability to limited partners, making it ideal for investment partnerships. 

A Labuan LLP combines the flexibility of a partnership with the limited liability protection typically enjoyed by corporations. Partners are shielded from liabilities caused by the actions of other partners, and the structure allows for more operational flexibility. LLPs are ideal for professional services firms and investment vehicles. 

1. Strategic Location: Tap into the Asia-Pacific market, sharing the same time zone with major financial hubs.

2. Infrastructure: Operate under the excellent regulatory framework provided by the Labuan International Business and Financial Centre (IBFC).

3. Global Recognition: Labuan entities are accepted by prominent exchanges, including Hong Kong, Singapore, and Dubai.

4. 100% Foreign Ownership: Full foreign ownership with minimal regulatory requirements.

5. Tax Advantages:

   • Low corporate tax rate of 3% on trading activities.

   • Exempt from withholding tax, stamp duty, capital gains tax, inheritance tax, and other indirect taxes.

   • No tax on dividends paid to shareholders and no tax on director fees for foreign directors.

6. OECD Whitelist Status: Labuan’s OECD whitelist jurisdiction ensures strong compliance with global tax and transparency standards.