What does it take to obtain the prestigious Msc Malaysia Status Pioneer status in the light of Industry 4.0?
With a stroke of the pen, MDEC erases all those who had obtained their msc status from the board listing come 30 June 2021. Not surprising because the information technology has gone through a drastic change and what used to be leading technology in 1996 is rendered obsolete in the light of Industry 4.0. Today, we have to talk about Artificial Intelligence, Robotics, Iiot, connectivity between the physical and cyber and full automation. When the msc status was proposed way back in 1996, there was just a handful of information technology firms like Microsoft, Dell and Ericsson. Moving ahead twenty years since, ICT firms come in all sizes and forms and they have help change our economies towards things like lightning fast connectivity, sharing economies and digitally connected globalised supply chains. We have to change and so thus MDEC.
To be honest, MDEC has for many years wanted to make changes to its msc status portfolio just to reflect on the advances in ICT but was forced to hold back as she does not want to unnerve the many companies who had relied on the pioneer status to capture market share. The last straw came in the way of OECD�s pressure to adhere to its BEPS action 5 plan where small economies who had leveraged on preferential tax regimes to gain market access is forced to adhere to standard tax regimes. As a result, MDEC took the bull by the horn and made drastic change to its grant of pioneer status in coordination with the Inland Revenue Department. There has been a slew of changes since then regarding the type of industries that are preferred to be allowed to apply for msc status application. Also changed are the structure of the companies that are allowed to apply for the Msc Malaysia Status: companies will need a minimum of RM500,000 paid up capital.
All these criteria has been put in place since first January 2019 and so the Msc Malaysia Status route will be different from previous years and we would like to stress that it would be a very difficult journey from now onwards. To start with, approved activities are all synonymous with Industry 4.0 types, thus we will need to forget all those previous activities like ERP, CSM, Accounting, MLM and Logistics. Well, almost all of those except that if you can couple your ERP Platform with the likes of Artificial Intelligence and IIot. But we have to move with the times and so well, if it is IR 4.0, then we might as well embrace it whole heartedly. For Malaysia, it has never been a better time as we will need to run along otherwise we will be left behind, at least that is the opinion of the government. So we shall now sail with MDEC in these times of forth industrial revolution.
In OECD's view, it is of utmost importance for companies acquiring Msc Malaysia Status to have created their intellectual property in the form of copyrights and patents. This is seen as an effort and money put in by the firms to acquire their Msc Malaysia Status of which the OECD would like to see before a firm is conferred pioneer status with tax incentives. With the prioritising of obtaining intellectual property (also refered by oecd as substantive activities) as a requisite for getting pioneer status, firms that are applying for the Msc Malaysia Status should look into ways where they can acquire the IPs. In case you are one of those who are less well conversant with obtaining intellectual properties, you should get advises from IP firms before you even start on your pioneer status journey. Patentagentip is proud to be able to offer you assistance in intellectual property acquirements, so go ahead and contact us. Also, Patentagentip is also involved in helping firms to adopt Industry 4.0 elements. You are in good hands.