Is company that register under labuan saving much cost & have low standard compliance

The Labuan IBFC offers a range of tax incentives and regulatory benefits that can potentially reduce costs for companies registered under its jurisdiction. However, it is important to note that the level of cost savings and compliance standards can vary depending on the individual company and their specific circumstances.

1. Tax Incentives: Companies registered in Labuan IBFC can benefit from a range of tax exemptions, such as zero percent service tax, withholding tax, and stamp duty, as well as a 3% tax rate for trading activities and zero percent for non-trading activities. These tax incentives can significantly reduce the cost of doing business in Labuan.
2. Compliance Standards: The Labuan Financial Services Authority (Labuan FSA) is responsible for the development and administration of Labuan IBFC and has been reinforcing measures to combat money laundering and terrorism financing. Companies registered in Labuan IBFC are subject to a formal beneficial ownership reporting regime and are prohibited from issuing bearer shares, which helps maintain a high standard of compliance.
3. Substance Requirements: The Amendment Act of 2022 requires Labuan companies to have at least one Malaysia-resident director, which can be fulfilled by a trust officer of a Labuan trust company or an individual who is at least 18 years old and a citizen or permanent resident of Malaysia. This requirement ensures that companies have a certain degree of substance in Malaysia, which can help maintain compliance standards.
4. International Recognition: Labuan IBFC has been recognized by international organizations such as the OECD and FATF for its anti-money laundering policies, which indicates a high level of compliance standards.

While Labuan IBFC offers tax incentives and regulatory benefits, companies must still comply with relevant laws and regulations, including those related to tax, anti-money laundering, and substance requirements. Therefore, the cost savings and compliance standards will depend on the specific circumstances of each company and their ability to leverage the benefits offered by Labuan IBFC.