MTC AUTOMATION TECHNOLOGY ACQUISITION (ATA)
GUIDELINES
MTC expanded its financial incentive to incentivise eligible manufacturers in the timber industry for the purchase of new machinery/equipment to upgrade their manufacturing processes, for the diversification of the company’s product range as well as process line automation.
A) Eligibility Criteria
1. The company shall be incorporated in Malaysia and based in Peninsular Malaysia.
2. The company shall be a Malaysian-owned company (with at least 51% of shareholding).
3. The company shall be a member of any one (1) of the following six (6) timber associations:
- Malaysian Wood Industries Association (MWIA);
- The Timber Exporters' Association of Malaysia (TEAM);
- The Malaysian Panel-Products Manufacturers' Association (MPMA);
- Malaysian Wood Moulding & Joinery Council (MWMJC);
- Malaysian Furniture Council (MFC); and
- Persatuan Pengusaha Kayu-kayan & Perabot Bumiputra Malaysia (PEKA) [Association of Malaysian Bumiputera Timber & Furniture Entrepreneurs].
4. The company shall be installed with wood-based manufacturing facilities and in operation for at least three (3) years.
5. Must be involved in sawmilling or production of value-added timber products, or timber trading.
6. Priority is given to manufacturing companies that specialise in producing timber products for export.
7. Eligible for both small and medium enterprises (SMEs) and non-SME companies with an annual revenue below RM100 million and are not public listed, subsidiaries of public listed companies (PLC) or companies have equity owned by PLCs.
8. Companies with Government equity (federal or state) in its shareholding or state-owned enterprises are not eligible.
9. SMEs with common shareholders having different core businesses may apply (excluding Purchase of Material Handling Equipment), with a reimbursable amount as follows:
i. Purchase of new machine: RM70,000 each, up to RM140,000.
ii. Purchase of reconditioned machine: RM50,000 each, up to RM100,000.
10. SMEs with common shareholders with similar core businesses may apply and share the eligible incentive.
11. On-going projects where the machinery/system has been installed/in-operation are not eligible.
12. Companies that have received other grant or subsidy for the purchase of the said item from other government or government-linked agencies are not eligible.
B) Scopes and Incentive Categories
1. Automation Technology
- Automation technology refers to new machinery/equipment which is:
- Dedicated for sawmilling or value-added timber processing
- Used directly in the manufacturing processes at the factory floor
- Imported or locally fabricated
- The machine/equipment must be installed in the factory and have been in operation for at least one (1) month after commissioning before the submission for reimbursement.
- The company should demonstrate that the machine/equipment purchased enhances productivity, e.g. reducing man hours/number of workers/increasing the volume of output/reducing production lead time or increasing company’s revenue.
1.1 To incentivise SMEs that purchase new woodworking machinery involved directly in the manufacturing processes to upgrade their manufacturing processes or to diversify the company’s manufacturing capacity.
i. Matching Grant for Small Enterprises
- Small enterprises with sales turnover from RM300,000 to less than RM2 million.
- 50% of the machine price & freight charges.
- Limited to RM150,000 per company (one-off).
ii. Purchase of New Machine
- Small enterprise with sales turnover from RM2 million to less than RM15 million.
- 20% of the machine price & freight charges.
- Limited to RM70,000 per company/group of companies. Graduation policy applies.
iii. Medium Impact Project (MIP)
- Medium enterprises with sales turnover from RM15 million to not exceeding RM50 million.
- 20% of the machine price & freight charges.
- Minimum project value at RM350,000.
- Limited to RM150,000 per company/group of companies (one-off).
1.2 To incentivise non-SMEs in their domestic investment in new production line(s) with modern technologies for upgrading of manufacturing facilities and ultimately to gear the industry towards Industry 4.0.
i. High Impact Project (HIP)
- Non-SMEs, i.e. sales turnover from RM50 million to not exceeding RM100 million.
- 10% of the machine price & freight charges.
- Minimum project value at RM700,000.
- Limited to RM200,000 per company/group of companies (one-off).
2. Material Handling Equipment
- To address timber industry’s urgent needs for material handling equipment due to labour shortage.
- Material handling equipment includes semi and auto pallet truck, auto stacker, conveyors/rails, sortation system, automated guided vehicle, etc. and positioning equipment covering lift/tilt/turn tables, manipulators, industrial robots, etc.
i. Purchase of Material Handling Equipment
- Open for both SMEs and non-SMEs.
- 50% of the machine price & freight charges.
- Limited to RM100,000 per company/group of companies (one-off).
3. Reconditioned Machine
- In addition to the eligibility criteria for Automation Technology, reconditioned machine should mean that a machine which has been inspected, and that any damaged or worn parts have been either repaired or replaced. The machine is then reassembled, returning it to “as new” condition or in good working condition.
- A used machine “as is”, i.e. a machine that has been used and not properly maintained or reconditioned is not eligible for this incentive.
- The reconditioned machine must not be more than 5 years old from the original fabrication date.
i. Purchase of Reconditioned Machine
- Open for both SMEs and non-SMEs.
- 10% of the machine price & freight charges.
- Limited to a maximum of RM50,000 per company/group of companies. Graduation policy applies.
C) Graduation Policy
- The recurring financial incentive is given up to a stipulated period of two (2) cycles1 per company/group of companies.
- The number of cycles shall be determined by the company’s participation in ATA [formerly known as Financial Incentive for Purchase of Machinery (FIPM)], following the launch of the FIPM programme in 2018.
Note: 1 The duration of each cycle for the application year from 2018 to 2021 was three (3) years, whereas from 2022 onwards, it is two (2) years.
D) Registration/Application
- Register for an account at MTC IAP Portal: iap.mtc.com.my. Once the account registration is approved, the applicant will receive an email notification and instructions to log into the Portal.
- Applying Company shall complete their company profile in the online application portal.
- Applying Company with existing account in the portal shall log in and update their company profile. The company profile can be updated at any time and should be kept up to date for MTC’s evaluation.
- Submit the Application Form online after the purchase has been confirmed.
- Certified true copies of documents2 to be submitted online include:
- Form 24 as per the Companies Act 1965 OR Section 78 as per the Companies Act 2016
- Form 49 as per the Companies Act 1965 OR Section 58 as per the Companies Act 2016
- Latest Section 68 (Annual Return) as per Companies Act 2016
- Purchase Order/Sales Contract for the new machine/equipment
- Brochure with photos and technical specification of new machine/equipment
- Valuation Report (for reconditioned machine only)
- Manufacturing process flow chart explaining major processes
- Relevant position of the new machine/equipment on the factory floor
- Factory layout plan
- Technical proposal (for MIP and HIP only)
- Latest three (3) years audited accounts
- Latest three (3) months bank statement
Note: 2To certify on the first page only. Hardcopies are not required. Verification would be carried out during on-site DDA.
- An introductory session will be conducted by MTC to provide guidance to the Applying Companies on the reimbursement application process.
- The Applying Company is required to submit the “Letter of Commissioning/ Service Report” online/via email to MTC within one (1) month from the date ofthe “Letter of Commissioning/Service Report”.
- A Conditional Approval Letter will be issued and sent to the eligible Applying Company to progress to the next stage.
E) Reimbursement
- Online submission via MTC IAP Portal (iap.mtc.com.my) for reimbursement application (with full supporting documents) must reach MTC within two (2) months from the date of the “Letter of Commissioning/Service Report”.
- Late submission for reimbursement application after the aforementioned two (2) months period will not be considered by MTC.
- Certified true copies of documents2 to be submitted online for the reimbursement include:
- Supplier’s Invoice and Delivery Order for the machine
- Bill of Lading, Customs Declaration Form (K1) and Packing List (if purchased offshore)
- Transport or ocean freight charges
- Proof of payment issued by the local supplier
- Data3 (e.g. “before and after” results) to show that the equipment/system enhances production efficiency, e.g. reducing man hours/reducing number of workers/increasing the volume of output/reducing production lead time and/or increasing company’s revenue.
Note: 2 To certify on the first page only. Hardcopies are not required. Verification would be carried out during on-site DDA.
3 Latest one (1) month’s production record each for before and after the commissioning of the new machine. Application for material handling equipment need not to provide the data.
- MTC will conduct the due diligence audit (DDA) upon receipt of the online submission for reimbursement. Revised production data and required supporting documents (where necessary) to be submitted to MTC within two (2) weeks from the DDA.
- MTC may engage a technical expert to assist in the DDA.
- Approval for reimbursement is at the sole discretion of MTC.
- Priority is given to companies that participate in MTC Factory Transformation Programme.
- The financial incentive provided is on a first-come, first-served basis until the budgeted allocation is fully utilised.
- MTC reserves the right to amend the Guidelines of this Programme at any time without any prior notice.
F) Non-compliance (Penalty)
- In the event of non-compliance to the guidelines, the company must undertake to refund in full the disbursement's amount to MTC.
G) Process Workflow
For further enquiries and information, please contact:
1. Ms Ong Lay Lee, ext. 602, email: ong@mtc.com.my
2. YM Raja Mahadi Raja Muhamed, ext. 605, email: rajamahadi@mtc.com.my
3. Mr `Ammar Muhammad Shahmie, ext. 608, email: shahmie@mtc.com.my
4. Ms Siti Azura Saidin, ext. 610, email: azura@mtc.com.my
Industry Development & Transformation Division (IDTD)
