November 8, 2011 [BERNAMA] - Malaysia is well positioned to help global petroleum storage and trading companies enter the vast markets of China, India and Southeast Asia, said President cum Chief Executive Officer of Malaysia Petroleum Resources Corporation (MPRC) Dr. Emir Mavani.
The country can leverage on its inherent strengths to create a natural oil and gas trading hub in this region, as “we have the land, oil and gas and highly qualified people,” he said in a statement here today.
The Labuan FSA and Malaysia Petroleum Resources Corporation (MPRC) on October 31 had launched the Global Incentives for Trading (GIFT) programme as part of efforts to develop Malaysia as an oil and gas trading hub.
Five trading companies were also given the inaugural licenses by Labuan FSA, entitling them to be immediately eligible for the GIFT incentives.
They were PETCO which is a subsidiary of Petroliam Nasional Bhd, Dialog Group Bhd, YTL Power International Ltd (a subsidiary of YTL Corporation Bhd), B.B. Energy of Greece and Vitol Group of Switzerland.
“The companies that are here today have expressed their interests and desire to play a leading role in the storage and trading business,” Dr Emir said in the statement issued through Labuan FSA, adding that it “will be an exciting time for oil and gas companies for the foreseeable future.”
Incentives offered under the GIFT programme to petroleum and petroleum-related trading companies include a flat corporate tax rate of three per cent of chargeable income and 100 per cent exemption on director fees paid to non-Malaysian directors.
Others are 50 per cent exemption on gross employment income for non-Malaysian professional traders; tax exemption of stamp duties on documentation for Labuan business activities and tax exemption on dividends received by or from the LITC companies and all other fiscal incentives that are attached to a Labuan entity.
The incentives under GIFT are expected to encourage global storage and trading companies to use Malaysia as their base for storage, trading and business development purposes.
To qualify for these benefits, companies must also generate a minimum company turnover of US$100 million annually, employ a minimum of three professional traders as well as use and engage local support services among others.
MPRC started operations in July 2011 and is mandated by the Government of Malaysia to transform the oil and gas services sector with a long-term aim of making Malaysia the number one hub in the Asia Pacific region for the industry.
