In this course · 6 of 6
Course 6
Customers, data and payments
6 lessons · 6 min
- 1Online Store Disclosure Rules in Malaysia (Regulations 2024)
- 2Marketplace vs Seller Duties Under Malaysia's 2024 Online Trade Rules
- 3PDPA Rules for Online Stores Collecting Customer Data in Malaysia
- 4How to Check If a Payment Gateway Is Licensed by Bank Negara Malaysia
- 5How to Reconcile Shopee, Lazada and Payment Gateway Payouts with Sales
- 6Is Dropshipping Legal in Malaysia? Registration, Tax, Consumer Law
The short answer
A dropshipper in Malaysia is the seller in law. Registration with the Companies Commission of Malaysia (SSM), tax on profit, the store-page disclosure rules and the duty to bear re-delivery of defective or wrong goods all apply even though the supplier ships the goods.
Dropshipping means taking the order and payment, then having a supplier send the goods directly. The supplier's role does not change the dropshipper's legal position towards the buyer.
Registration. A dropshipper who sells regularly for profit is carrying on a business and is expected to register with SSM, as with any online seller.
Tax. Profit (sales less supplier cost, platform fees and other expenses) is business income. Keep supplier invoices and proof of payment, since cost of goods is deducted using them.
Consumer law. Under the Consumer Protection (Electronic Trade Transaction) Regulations 2024 the supplier on the store page must show its own name, contact details, address, full price including delivery and taxes, payment methods, terms and estimated delivery time. A seller that agreed to receive payment must bear the cost of re-delivery if the goods received differ materially or are defective.
Overseas suppliers. Goods shipped from abroad to Malaysian buyers at RM500 or less per item can be subject to the 10% LVG sales tax, collected by a registered seller or marketplace. Who is the registered seller depends on the contract and platform, so confirm before importing at volume.
Delivery times. The seller must state realistic estimated delivery times.
Legal basis and sources
The law
- Registration of Businesses Act 1956
- Consumer Protection (Electronic Trade Transaction) Regulations 2024, regs. 3 and 5
- Sales Tax Act 2018
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
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