26 June 2023
Immigration
Impact: High
Summary
Referring to the latest announcement by the Expatriate Services Division (ESD) of the Immigration Department of Malaysia, the process for Employment Pass application has been streamlined with the introduction of a new online platform, Xpats Gateway on 15 June 2023. Companies under the purview of certain regulatory bodies or approving agencies can now apply for support letters for their expatriate employees to the relevant regulatory bodies or approving agencies through the Xpats Gateway prior to submitting the Employment Pass application to ESD.
Previously, companies under the purview of regulatory bodies or approving agencies were required to obtain the necessary support letters directly from the relevant regulatory bodies or approving agencies whereby the processes and timelines would vary between these different authorities.
The overall processing time in obtaining support letters (if relevant) and Employment Passes would now also be based on the company’s tier.
The Detail
Prior to submitting an Employment Pass application to ESD, companies under the purview of regulatory bodies or approving agencies are required to obtain a support letter from the relevant regulatory body or approving agency. Once the company obtains the support letter either through a manual application or other online platforms, it can then proceed in applying for the Employment Pass to ESD. The relevant regulatory body or approving agency would depend on the sector or industry which the company is operating in.
With the implementation of the Xpats Gateway platform, the process and timeline to obtain the support letters are streamlined across all relevant regulatory bodies or approving agencies and companies will no longer be required to submit support letter applications directly to the regulatory bodies or approving agencies through the various platforms or channels.
The implementation of the Xpats Gateway platform will be in two (2) phases, depending on the relevant regulatory body or approving agency which companies fall under.
Phase 1: 15 June 2023
| No. | Sector / Industry | Regulatory Body / Approving Agency |
| 1 | Manufacturing and Selected Services Sectors | Malaysian Investment Development Authority (MIDA) |
| 2 | Financial Services (Licensed Institutions, Payment Services Regulatees and Representative Offices) | Central Bank of Malaysia (BNM) |
| 3 | Securities and Derivatives Markets | Securities Commission Malaysia (SC) |
| 4 | Companies operating within East Coast | East Coast Economic Region Development Council (ECERDC) |
| 5 | Healthcare (Field: Traditional and Complementary Medicine) | Traditional and Complementary Medicine
Division, Ministry of Health (MOH) |
| 6 | Tourism | Ministry of Tourism, Arts & Culture (MOTAC) |
| 7 | Biotechnology and Bio-based Sector | Malaysian Bioeconomy Development Corporation (Bioeconomy Corporation) |
| 8 | Aviation | Civil Aviation Authority of Malaysia (CAAM) |
| 9 | Construction | Construction Industry Development Board (CIDB) |
| 10 | Education | Ministry of Education (MOE) |
| 11 | Mining, Quarrying & Mineral Processing | Department of Mineral & Geoscience (JMG) |
Regulated companies will need to apply for the support letter directly with the relevant regulatory body or approving agency for sectors not listed above, until Phase 2 of the implementation of the Xpats Gateway on 31 July 2023.
Furthermore, the company tiering system under ESD has now been enhanced and it is aimed to aid decision making by the relevant authorities during the processing of the Employment Pass applications. Companies under ESD are ranked according to the following five (5) key indicators:
Under the enhanced company tiering system, companies are scored among its peers that have similar characteristics and track records. The previous ESD scoring system did not take into consideration the differences in the above areas.
With the enhanced company tiering system, higher tiered companies qualify for a shorter processing time of Employment Pass applications, as compared to lower tiered companies. As an illustration, below is a standard lifecycle of an Employment Pass application based on the different company tiering, with a comparison between the previous processing time and the new reduced processing time:
Tier 1, 2 and Critical Sectors
| Department of Labour Peninsular Malaysia & MyFutureJobs | Company Registration | Regulatory Body / Approving Agency | Employment Pass Approval | Employment Pass Endorsement |
|---|---|---|---|---|
| 14 working days
2 months *New processing time effective 15 June 2023 onwards *Previous processing time prior to 15 June 2023 | 5 working days
At least 14 working days One-off application for companies yet to be registered with ESD | 3 Working days
5 – 20 working days Applicable for regulated companies only | 3 Working days
5 – 10 working days Approval by ESD and immigration Department | 1 day for KLIA1
Endorsement Less than 7 working days for Pass sticker delivery 1 working day for ePASS (applicable for renewals only) |
Tier 3, 4 and 5
| Department of Labour Peninsular Malaysia & MyFutureJobs | Company Registration | Regulatory Body / Approving Agency | Employment Pass Approval | Employment Pass Endorsement |
|---|---|---|---|---|
| 14 working days
2 months *New processing time effective 15 June 2023 onwards *Previous processing time prior to 15 June 2023 | 5 working days
At least 14 working days One-off application for companies yet to be registered with ESD | 10 Working days
5 – 20 working days Applicable for regulated companies only | 5 Working days
5 – 10 working days Approval by ESD and immigration Department | 1 day for KLIA1
Endorsement Less than 7 working days for Pass sticker delivery 1 working day for ePASS (applicable for renewals only) |
Professional Visit Pass applications under ESD and Employment Pass applications under the Malaysia Digital Economy Corporation (MDEC) remain the same for the time being.
What this means
The introduction of the Xpats Gateway platform and company tiering system is expected to improve the ease of doing business in Malaysia as the overall process to obtain Employment Passes for expatriates is now significantly streamlined across various regulatory bodies and agencies and the processing time is reduced. In line with the Government of Malaysia’s efforts in attracting more foreign direct investments (FDI) into Malaysia, companies are now able to mobilise their foreign talent pool from abroad and employ expatriate employees for positions requiring foreign expertise within a shorter turnaround time, in accordance with immediate business needs.
Furthermore, the Xpats Gateway platform is certainly a welcome introduction especially for companies under the purview of regulatory bodies or approving agencies as these regulated companies are no longer required to go through different channels and platforms to obtain support letters prior to applying the Employment Passes.
How we can help
Our team is able to assist you in understanding the Xpats Gateway in greater detail and applying for the relevant support letters and Employment Passes. In the meantime, our team is closely monitoring the implementation of the Xpats Gateway and we will provide you with the relevant updates from time to time.
Contact us
For a deeper discussion on the above, please reach out to your Vialto Partners point of contact, or alternatively:
Further information on Vialto Partners can be found here: www.vialtopartners.com
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