A sole proprietorship, also known as the sole trader, is a type of business entity that is owned and operates by an individual, in which there is no legal separate entity between the sole proprietor and the business. In short, the sole-proprietor is having unlimited liability and would personally liable.

This entity is almost the same as sole-proprietorship except its owner are more than one person. Thus, there is no legal separate entity between partners and the business.

This is the most commonly use business vehicle in Malaysia. It is to be incorporated with the Companies Commission of Malaysia. With effect from 31st Jan 2017, where the new Companies Act 2016 is appointed, it replaced the old Companies Act 1965 and allows sole members and director. It is incorporated and regulated under the Malaysian Companies Act 2016 and Companies Commission of Malaysia respectively.

Pursuant to section 236(2) of the Companies Act 2016, all companies incorporated must appoint at least one qualify company secretary within 30 days from the incorporation.

Such private companies are not allowed to raise fund from the public and the transfer of shares are restricted.

Companies incorporated or changed from private company limited by shares are no different from the companies incorporated under private limited company except for the following :-

1. Is allowed to raise fund from the public and private provided it gains approval from the authority, such as Security Commission
2. No restriction on transfer of shares
3. Unlimited shareholders

This entity is only introduced in Malaysia in 2012. Limited Liability Partnership is an alternative business vehicle regulated under the Limited Liability Partnerships Act 2012 with limited liability.