Social media and messaging platforms required to establish local entity for licensing

KUALA LUMPUR: Social media and internet messaging service providers must set up a locally-incorporated entity before applying for a licence, though foreign companies might be exempt.

According to a frequently asked questions guide issued by the Malaysian Communications and Multimedia Commission (MCMC), the Communications Minister has the authority to grant exceptions to foreign companies on a case-by-case basis.

The guidelines specify that the local entity must have at least 30 percent Bumiputera ownership, although there is no limit on foreign shareholding.

The FAQ also clarified that only service providers with 8 million or more users in Malaysia need to apply for the licence. This includes platforms like Facebook, Facebook Messenger, Instagram, TikTok, WhatsApp, Telegram, WeChat, X, and YouTube.

These service providers have a five-month grace period starting from August 1, the date the framework was officially gazetted, to apply for the licence and meet its requirements.

Previously, MCMC introduced this licensing requirement as part of a new regulatory framework aimed at enhancing online safety.

On Tuesday, Communications Minister Fahmi Fadzil noted that MCMC had engaged with most of the relevant platforms regarding the new requirement, although some have yet to respond.