Quick answer: MDEC's Malaysia Digital (MD) guidelines do not name e-commerce as an activity, and they exclude trading, retailing and leasing of hardware, software and accessories. A company that simply sells goods online does not qualify. A company that builds and operates its own technology platform may map to a named area such as a sharing economy platform, cloud computing or big data analytics, so the question is what the company actually does. Confirm borderline cases with MDEC.
- E-commerce is not named as an MD activity.
- Trading and retailing are excluded.
- A technology platform, not the selling of goods, is what may qualify.
- Sharing economy platforms are a named area, covering matching supply and demand.
- Confirm borderline platform models with MDEC before applying.
Selling Versus Building
| Business model | Likely position |
|---|---|
| Online store selling goods bought for resale | Excluded as trading and retailing |
| Marketplace platform matching buyers and sellers | May map to a sharing economy platform or other area, confirm with MDEC |
| Own e-commerce software sold to merchants | May map to cloud-based applications, confirm with MDEC |
| Logistics and delivery platform | Sharing economy platforms include delivery and transport services |
| Analytics for merchants | May map to big data analytics or AI |
What MDEC's Sharing Economy Area Covers
MDEC describes sharing economy platforms as digital platforms that match supply and demand so people can share underused assets, goods or skills on a temporary or on-demand basis, including gig work, freelancing, delivery and transport services and asset sharing. A marketplace that fits this description has a basis for the area. A shop selling its own stock does not.
Questions to Ask About Your Model
- Is our revenue from selling goods, or from technology or platform fees?
- Do we build and operate the platform ourselves?
- Does the platform match supply and demand as MDEC describes?
- Can we show two knowledge workers working on the technology?
- Have we avoided the retailing, trading and marketing exclusions?
If You Are Mainly a Seller
| Option | What it means |
|---|---|
| Change the model | Develop and operate technology as the core business |
| Separate the technology arm | A distinct entity or activity that builds the platform, if genuinely independent |
| Skip MD status | If the core is retailing, MD status may not be available to you |
Not sure where you stand? WhatsApp us. We will check it before you apply.
Mistakes
Applying as an online shop
Retailing is excluded.
Calling a store a platform
MDEC looks at what the company does.
Ignoring marketing exclusions
Advertising and promotion are excluded.
Three Scenarios
Scenario 1. An online fashion store applies. Retailing is excluded, so it does not qualify.
Scenario 2. A company builds a marketplace app matching freelancers and clients. It may map to a sharing economy platform.
Scenario 3. A company sells merchant software on a subscription basis. It may map to cloud-based applications.
How We Help
What we handle for you
Before you apply
- Test your activity, hiring plan and cost base against MDEC's conditions.
- Advise whether MD status, a tax incentive or both make sense for your business.
- Prepare your business plan and financial plan based on your company idea or business model.
Application
- Prepare and submit the application and answer MDEC's questions.
Why companies choose us
End-to-end under one roof
- We handle company incorporation, accounting and payroll, as well as MD status and expatriate pass applications, so your structure, records and hiring plan stay aligned.
- The company is set up correctly from day one.
We check before you invest
- We confirm eligibility, including whether you can hire the expatriates you need, before a foreign investor decides to incorporate in Malaysia.
- Neutral Consulting PLT is a Kuala Lumpur firm led by a Managing Partner who is a member of the Malaysian Institute of Accountants.
Frequently Asked Questions
Quick answers.
Does an e-commerce company qualify for Malaysia Digital status?
A company that sells goods online does not, because retailing and trading are excluded. A technology platform may map to a named area.
Is e-commerce an MD activity?
It is not named in MDEC's activity list.
Does a marketplace platform qualify?
It may map to the sharing economy platform area, which covers matching supply and demand, but confirm with MDEC.
Do delivery platforms qualify?
Sharing economy platforms include delivery and transport services.
Does an online store qualify?
No. Trading and retailing are excluded.
Does dropshipping qualify?
It is a form of trading and retailing, which is excluded.
Does e-commerce software qualify?
It may map to cloud-based applications or other areas. Confirm with MDEC.
Does digital advertising for sellers qualify?
Advertising, marketing and promotion are excluded.
What staff are needed?
At least two full-time knowledge workers on the MD activities.
How should I describe my business?
Describe the technology you build and operate, not the goods you sell.
Who can confirm my model?
MDEC's Client Contact Centre at [email protected].
Can you assess my e-commerce model?
Yes. We test your model against MDEC's areas and exclusions.
Sources
Official sources
This page is general information, not legal advice. Agencies change their requirements, so confirm the current rules with MDEC, or with us, before you act. Checked November 2026.
Talk To Us Now
Thinking of applying for MD status? We will assess it first. All consultations are by video call.