MTC AUTOMATION TECHNOLOGY ACQUISITION (ATA)

 GUIDELINES

MTC expanded its financial incentive for purchase of machinery to incentivise eligible manufacturers in the timber industry not limited to the purchase of new machinery to upgrade their manufacturing processes. In addition, it also covers the expansion and diversification of the company’s manufacturing capacity as well as process line automation.

A)   Eligibility Criteria

• A member of any one (1) of the six (6) timber associations:

                           i.   Malaysian Wood Industries Association (MWIA);

                         ii.   The Timber Exporters' Association of Malaysia (TEAM);

                        iii.   The Malaysian Panel-Products Manufacturers' Association (MPMA);

                        iv.   Malaysian Wood Moulding & Joinery Council (MWMJC);

                         v.   Malaysian Furniture Council (MFC); and

                        vi.   Persatuan Pengusaha Kayu-kayan & Perabot Bumiputra Malaysia (PEKA)

                              [Association of Malaysian Bumiputera Timber & Furniture Entrepreneurs].

• The company must be based in Peninsular Malaysia, installed with wood-based manufacturing facilities, in operation for at least three (3) years;
• Must be involved in sawmilling or production of value-added timber products;
• Must be a majority Malaysian-owned company (i.e. with at least 51% of Malaysian shareholding);
• Small and Medium Enterprise (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 Equipment/System: RM70,000 each, up to RM140,000;

                           ii.         Purchase of Reconditioned Machine: RM50,000 each, up to RM100,000.

• SMEs with common shareholders with similar core businesses may apply and share the eligible incentive;
• For ongoing project(s) where the machinery/system has been installed/in-operation are not eligible to apply; and
• 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 for this incentive.

B)   Type of Incentive

 1.   Purchase of New Equipment/System

 1.Reimbursement Rate

• SMEs: 20% of the equipment/system price and freight charges, which is limited to a maximum of RM70,000 once every two (2) years¹ per company/group of companies.
• Non-SMEs: 10% of the equipment/system price (minimum purchase value at RM300,000) and freight charges, which is limited to a maximum of RM70,000 once every two (2) years¹.

            Note: ¹Based on the date of the new machine commissioned.

        2.Automation Technology

• Automation technology refers to machinery which is:
• Dedicated for sawmilling or value-added timber processing
• Used directly in the manufacturing processes at the factory floor
• New equipment/system
• Imported or locally fabricated
• The equipment/system 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 equipment/system 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.

 2.   Purchase of Reconditioned Machine

1. Reimbursement Rate

• SMEs and Non-SMEs: Entitled to 10% of the reconditioned machine’s price, limited to a maximum of RM50,000.00 once every two (2) years¹ per company/group of companies.

           Note: ¹Based on the date of the new machine commissioned.

        2. 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.

 3.   Purchase of Material Handling Equipment

 1. Reimbursement Rate

• SMEs and Non-SMEs: 50% of the equipment/system price, limited to a maximum of RM100,000 once per company/group of companies (one-off allocation).

 2. Material Handling Equipment

• 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.

C)     Registration/Application

• Register for an account at iap.mtc.com.my. Once the account registration is approved, the applicant will receive an email notification and instruction 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 Form of Annual Return
• Purchase Order/Sales Contract for the machine
• Brochure with photos and technical specification of new equipment/system
• Valuation Report (for reconditioned machine only)
• Manufacturing process flow chart explaining major processes
• Relevant position of the new equipment/system on the factory floor
• Factory layout plan
• 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.

• MTC will send an acknowledgement of receipt to the Applying Company of its application.
• After that, the Applying Company must allow an introductory session to be conducted by MTC prior to the installation of the equipment/system.
• The Applying Company is required to submit the “Letter of Commissioning/ Service Report” online to MTC immediately after the new equipment/system has been commissioned. A Conditional Approval Letter will be issued and sent to the eligible Applying Company to progress to next stage.

D)     Reimbursement

• Online submission for reimbursement (with full supporting documents) must reach MTC within two (2) months after commissioning of machine purchased.
• Late submission for reimbursement after the aforementioned two (2) months period will not be considered by MTC.
  • Certified true copies of documents³ 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
  • Data⁴ (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: ³To certify on the first page only.

                            ⁴Latest 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. Hardcopy documents (certified true copies) for the reimbursement submission to be submitted to MTC within two (2) weeks from the DDA.
• MTC may engage a technical expert to assist in DDA.
• Approval for reimbursement is at the sole discretion of MTC.
• The financial incentive provided is on a first-come, first-served basis until the budgeted allocation is fully utilised.

E) 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.

F) Process Workflow

For further enquiries and information, please contact:

1. Ms. Ong Lay Lee, ext. 602, email: ong@mtc.com.my

2. Ms. Wong Mei Kuan, ext. 605, email: mkwong@mtc.com.my