Buying a restaurant

Check this guide
http://malaysiabizadvisory.com/how-to-s … -malaysia/

The issues are even if you got a local partner and could buy a small business there will be difficulty getting EP as you will probably be viewed as just an investor. Paid up capital requirement would be myr 350k as opposed to myr 1 million

Restaurants are a precarious type of business and failure is quite a high risk.

In this trying economy times.
If one decided to quit their day job.
And instead operate a restaurant.
As that type of business "can make money" here.
We say "go for it".

Would be able to advise you on an F&B biz.
However not familiar with Immigration laws.
Or are you already married to a Malaysian?

Thanks Gravitas and Ash

I'm only considering fuld ownership.

The restaurant I'm considering is already registered with a paid up capital of 1mill. As I understood, no need for a new paid up capital of 1 mill. I'm not starting a new company, but taking over existing. I'm looking for an advisor or a lawyer with knowledge with buying and selling business to help me to take over the restaurant and ensure everything are legal. The restaurant is running good! Also need to ensure that I can apply for a work permit for me and my family once taking over the restaurant.

Because of the problem of getting an EP unless you are a chef., perhaps consider getting the Sarawak Mm2h based on Fixed Deposit route which allows you and family to live in KL and be just an investor in  the restaurant

Thanks Gravitas.

I found a company who can help to buy a restaurant and also with EP. They seems to have good knowledge with the process. Anyone have used QADKAM before?
http://malaysiaworkvisa.com/buy-business/

Don't use an Agent but find a Legal company or Accountant that  specialise in Company Secretarial matters. Usually incorporation Agents are not experienced in immigration matters or getting a trading license. They focus just on the company set up.

Use a company which specialises in Malaysia and not an incorporation bucket shop. The MIA can recommend a convenient and experienced Accountant. (Malaysian Institute of Accountants).

Shop around and speak to Accountants and Solicitors until you find one you find compatible.

Remember that often there are two sets of Accounts being run and you may only see one of them when being encouraged to buy a business. You are liable for the 1m PUC and all overhead agreements if you take a business over, eg rent and suppliers......

Proceed with caution.

The main issue is that even though you can buy any business you want, being the owner does not guarantee you a work permit or a trading license as they are related to you as a person and not the company. They don't come automatically with owning the company.

If anybody says otherwise dont trust them to assist you.

To get an EP you need a role and salary in the daily working of the restaurant. That requires relevant qualifications and experience.

***

As Gravitas started, its very UNLIKELY you would be granted a workpass to work in your own restaurant business because thats going to be reserved for locals. You can own stock in a company but today its extremely unlikely you could even be given the title of Managing Director. As the owner of the business you would have the title of Director and no workpass. Youd be in trouble if caught working. As Director, you have no immigration rights so there is no visa for you at all outside of a tourist visa. Company ownership has no connection to immigration matters, they are separate considerations.

That said, some of this relates to paid-up capital. From what Im saying one might ask how managers from Tesco in the UK are allowed to work here. I will suppose that with millions in paid-up capital created in the partnership with local company Sime Darby, they could petition the govt for anything they wanted. But are you a billion-dollar company?

Small businesses are just about finished as to foreigners now except in highly desired industries like bio-medical or something on a potentially grand scale.

As to taking over a company, all thats technically needed is a company Resolution written at a board of directors meeting in which the shares of the company are transferred to you. After that, there is banking and govt records that have to be produced so that your name will be appearing instead of the old name and that you will get to sign on the bank account, etc.

Im sure that many people have attempted to get around these problems by creating silent partnerships with local people but the potential for loss of control and complete loss of capital makes this course far too risky.

I can suggest you contact this accountant/secretary who is highly experienced and specialized in this and can properly guide you:

Amanda Woo
Office:
Asiacorp                               
Unit 5-1 Infinity Tower
Jalan SS6/3, Kelana Jaya   
47301 Petaling Jaya                           
Selangor, Malaysia                           

Tel : +6012-3835052
+6016-2162052

***

Have you bought it already?
Restaurant are sold because they do not make a profit.  Be sure to know your potential market for your restaurant. If you are gonna change your concept it will be good to do a market survey first before you take over.
Concept restaurants have a very short life-span unless you are a really big hit.  Dependable staff re not easy to find and you may have to a mix of locals and foreigners.

May I know what is the current concept of the outlet and location?  I can provide loads of advise before you make the final decision.  I have been in the restaurant business for a good 10 years before retiring.   was the General Manager of a number of steakhouses and German restaurants in KL since 2002.

We can talk more if you like.   

Robinson

Thanks to all who have replied.

I'm aware of the risk and competitions with F&B. The restaurant I'm buying is already registered with a paid up capital of 1mill. And the owner is foreinger. I have finally found a company with experience in buying companies and immegration matters. But I would also like to get other opinion from some who have been this process before.

The process to take over a company take 2-3 weeks, if the company has no legal issues and have done the audit etc.. I already have a dp10 work permit with another company. My plan is to buy the restaurant now and become the director while applying for a dp10 work permit in my own company.. Is it legal to have multible jobs on same work permit. Or is the dp10 restricted for the company who have issued the visa for you?

You will have to give up the dp10 with current company to apply for the Director dp10 as only one work permit is possible at any time.

There is no guarantee you will get a Director dp10 unless you have skills required by the company. If you don't have restaurant skills you can still be a Director/owner (investor) , but won't get immigration under that company. It is probably 90% certain you will Not get the Director dp10 unless you are a chef.

Hopefully you are not using an Agent but using an Accountant or lawyer. Agents often have their own money making interests at heart and don't advise the pitfalls as they have their fee whether or not the transfer is successful or not.

You will need to pay the *rm1 million* paid up capital to the current owner as part of the transaction. Be careful of financial commitments the restaurant has such as rental agreements.

*One SCAM in many restaurant sales is you don't pay the 1 million to the owner (and on the sale they remove their 1 million) .

When it comes to transfer/renew the trade license the 1 million has to be shown in the corporate bank account. Then you can't move forward without finding the money yourself and still own a restaurant that can't open as it has no licence but has debts and overheads.

*The other SCAM on foreigners (and it can be your own countrymen doing it) is your 'buying' the restaurant is just a CAPITAL injection for the current owner to continue to run the restaurant (and pay themselves a nice salary) as they have license etc plus directors work visa.

They "sell" the restaurant (and "rescue" the new owner) many times to keep living in Malaysia and having income. There are lots of Arab restaurants around Bukit Bintang that could be cheating "investors" who think the can get EP but any income is already siphoned off

I think you should get a 2nd and 3rd opinion to discuss the issues you face. You could get into a really bad financial situation and be cheated as you seem quite confused if you don't even know you can only have one EP...... What kind of advice are you getting? What questions are you asking? None it seems. Just following the carrot to disaster

Perhaps actually read people s comments on this thread...........

Hi Gravitas

Thanks for your advice. I do for sure not have enough knowledge. And I'm trying to get advice from accountant/lawyer and people with own experience. The company I mentioned in my earlier thread, has not mentioned non of what you wrote. Actually they said everthing should be fine. They have checked the SST etcc. They will apply for WRT license and DP10 visa etc..

I'm in a dialog with another accountant who should have enough experience with this subject. He was recommended to me by a friend. Will meet him next week. And your comments is just what I needed.

By the way the price for the restaurant is close to a million.. (and with my experience from F&B it is worth it)

I will post again once I get more information. At least my case could be useful for someone else..

KR
James

If the price is close to 1 million you will need over 2 million to buy it.**

1 million to the current owner(s) which they pocket as selling price
And
1 million you will still have to put into the business as Paid Up Capital
Plus
Fees and Expenses

F&B is never worth a 2 million risk

Each year when the Financial Report for the business is completed (Report and Accounts) the Paid Up Capital has to be shown in the balance sheet. The 1 million can be used for running expenses but has to be returned.

Most importantly the new owners should for security of their investment appoint their own Company Secretary and not use the current one.

**The SCAM is you pay 1 million not knowing how the business set-up works and no experience. The owner offers you only a share in the business as you don't have enough money to own and run it ie 2 million. You are now bankrolling their lifestyle. Unfortunately this is how  F& B businesses get fresh money...... you are an investor and not owner so no dp10 either. Depending how many accounts books are being kept if you ever get any "profit"