In conjunction with its 10th anniversary celebration, LOFSA is organising a series of seminars and conferences in the months ahead to further enhance and promote the Labuan Malaysian IOFC.

A one and a half-day seminar will be held on 2 & 3 May 2006 at the Sheraton Labuan Hotel with the theme of: “Malaysian IOFC – The Preferred Financial Hub.” It is expected that the event will attract several prominent international speakers who will present to over 100 participants.

LOFSA will also organise the 2nd International Islamic Finance Conference in November 2006 and has again lined up a number of prominent speakers and presenters from the offshore and related industries for the 2-day seminar.

While Malaysia declared the island of Labuan to be an International Offshore Finance Centre in 1990, LOFSA was not established as the single regulator for Labuan until 1996 under the LOFSA Act.

Incorporting in Labuan offers significant benfits in terms of tax: the Labuan Offshore Business Activity Tax Act provides for the reduction or complete exemption of income tax in respect of many business activities carried on by offshore companies in Labuan.

Chargeable profits derived by an offshore company from an offshore trading activity are subject to tax at a rate of 3%. However, an offshore company which carries on an offshore non-trading activity is exempt from income tax altogether.

This benign tax regime has allowed Labuan to grow rapidly in stature, and it is now a well established IOFC. As at 30 September 2005, there were about 3,000 active offshore companies in Labuan, including 59 offshore banks, 112 offshore insurance and insurance-related entities, 68 leasing companies, 15 fund managers and 20 trust companies.

The remaining are trading and non-trading offshore companies originating from more than 70 countries, of which more than half were from the Asia-Pacific region.

A recent entrant to the Labuan IOFC was KFH (Labuan) Berhad, a subsidiary of Kuwait Finance House (Malaysia) Berhad which offers a wide range of shariah-compliant offshore banking products.

LOFSA believes that the establishment of firms such as KFH (Labuan) Berhad will encourage more international Islamic financial institutions to establish operations in Labuan.