If your company wants to carry out any construction work in Malaysia, a CIDB registration is not optional — it is the law. Under Section 25 of the CIDB Act 520, every contractor, local or foreign, must be registered with the Construction Industry Development Board (CIDB) before signing or executing any construction contract. Here is how it works for foreign companies in 2026.
Local grades vs the foreign-contractor route
Malaysian companies register under a grade from G1 to G7, which caps the tender value they can take on and sets a minimum paid-up capital:
| Grade | Tender value limit | Indicative paid-up capital |
|---|---|---|
| G1 | Up to RM200,000 | RM5,000 |
| G2 | Up to RM500,000 | RM25,000 |
| G3 | Up to RM1,000,000 | — |
| G4 | Up to RM3,000,000 | — |
| G5 | Up to RM5,000,000 | RM250,000 |
| G6 | Up to RM10,000,000 | RM500,000 |
| G7 | No limit | RM750,000 |
Which route applies depends on shareholding. A local grade (PPK) requires at least 70% local equity, and Chinese shareholders get no uplift under the ASEAN–China FTA, so the cap stays at 30%. A local grade also comes with specialisation codes that decide which tenders you can bid for. Both points are covered in our guide to CIDB specialisation codes and categories B, CE, ME and F.
What this means in practice
There are two realistic paths for a foreign construction business:
- Register a Malaysian Sdn Bhd and obtain a G-grade. If you incorporate a 100% foreign-owned company, it can register for a CIDB grade like any local company — subject to the paid-up capital and personnel requirements for that grade. This suits firms that want an ongoing presence and to bid for multiple projects.
- Foreign-contractor (project-based) registration. For a one-off awarded project, you register specifically for that job. The certificate is tied to the project and must be renewed/extended as above.
Documents you will need
- SSM certificate of incorporation;
- Audited account statements;
- Technical/professional qualification certificates of key personnel;
- Proof of relevant construction work experience;
- For higher grades — registered personnel meeting CIDB's technical staff requirements.
Common mistakes
- Signing the contract before registering. Registration must come first — executing work without it breaches Section 25.
- Under-grading. A G3 contractor cannot bid a RM4 million project; match the grade to the tender values you target.
- Letting a project-based certificate lapse. Miss the 14-day extension window and work can stall.
ONEKEY BIZ handles CIDB registration end to end — incorporating the right entity, meeting the grade's capital and personnel requirements, and preparing the technical documents. Talk to our licensing team or see our licence & permit services.
Frequently asked questions
Do foreign contractors need a CIDB licence in Malaysia?
Yes. Under Section 25 of the CIDB Act 520, every contractor — local or foreign — must register with CIDB before signing or executing any construction work. Foreign-contractor registration is project-based.
What do the CIDB grades G1–G7 mean?
Grades cap the tender value you can take on and set a minimum paid-up capital — from G1 (up to RM200,000) to G7 (no limit, ~RM750,000 capital). Match your grade to the project sizes you target.
What does 'project-based' foreign-contractor registration mean?
The certificate authorises only the specific project named on it, not open-ended work, and you must apply to extend its validity within 14 days before it expires.
Related services
We handle the process described in this article end-to-end.
- CIDB Grade G7 Contractor RegistrationTop-tier registration for projects of unlimited value.
- CIDB Grade G1 Contractor RegistrationContractor registration for projects up to RM200,000.
- CIDB Grade G2 Contractor RegistrationContractor registration for projects up to RM500,000.
Sources & references
This article is general information only, not legal, tax or immigration advice. Policies, thresholds and official fees are set by the relevant Malaysian authorities and may change. Talk to our consultants about your specific situation.