Shariah Compliant Pure Captive via Labuan IBFC

LABUAN IBFC INC SDN BHD IS THE OFFICIAL AGENCY AUTHORISED BY THE MALAYSIAN GOVERNMENT TO MARKET LABUAN AS THE PREMIER INTERNATIONAL BUSINESS AND FINANCIAL CENTRE IN ASIA PACIFIC

Summary

1. Definition and operational structures.

2. Who qualifies?

3. How to set-up a Labuan Shariah compliant pure captive (“Labuan SPC”)?

4. Permitted business activities.

5. Operational requirements.

6. Shariah compliance.

7. Labuan SPC - How it works?

8. Opportunities in the Malaysian market.

Definition and Operational Structures

Who qualifies?

How to set-up a Labuan SPC?

Labuan SPC permitted business activities

Labuan SPC operational requirements

Shariah compliance

9

Labuan Shariah Compliant Pure Captive - How it works?

Scenario• Company A – Singapore company • Company B – Licensed Labuan SPC wholly owned by A• C – Licensed domestic insurance company in Singapore• A & companies within its group insures with C (fronting)• C reinsures most of the risks with B• B retains some risks (e.g. 15%) and reinsures the rest with

international reinsurers at competitive rates

Advantages• Low tax regime – 3% of audited profits or MYR20,000• Tax deduction for premiums• No WHT on dividends paid by B• Creation of profit centre in B• Retains control of the group’s risk management• Access to competitive market rates for re-insurance• Conducive regulatory environment

Retained Risks

Insures withSingapore

co. A

Domestic Singapore Insurance

co. C

Reinsures with

Insured with International Reinsurers

15%

85%

Labuan co. B

0% WHT dividends

Opportunities in Malaysian market Opportunities in the Malaysian market

Please visit – www.LabuanIBFC.my

LABUAN IBFC IS THE OFFICIAL AGENCY SANCTIONED BY THE MALAYSIAN GOVERNMENTTO MARKET LABUAN AS THE PREMIER INTERNATIONALBUSINESS AND FINANCIALCENTRE IN ASIA PACIFIC