A sole proprietorship, also known as a sole trader ship, individual entrepreneurship or proprietorship, is a type of enterprise owned and run by one person and in which there is no legal distinction between the owner and the business entity. 

A partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners in a partnership may be individuals, businesses, interest-based organizations, schools, governments or combinations.

A limited liability partnership is a partnership in which some or all partners have limited liabilities. It therefore can exhibit elements of partnerships and corporations. In an LLP, each partner is not responsible or liable for another partner’s misconduct or negligence.

A private limited company (Sendirian Berhad or Sdn Bhd) is a separate legal entity from its owners, meaning that it can buy or sell property, enter legal contracts and sue or get sued in courts.The owners are liable only to the amount they have contributed to the company, and their personal assets or wealth will be left untouched if something happens to the company.

Having a valid business license is essential for starting a business in Malaysia. It includes licenses, registrations, permits and approvals. Business license can be applied from the Pihak Berkuasa Melesen (PBM) relevant to the location and business activity. Before a business can legally start operating, businesses are required to comply with some form of licensing, which could be a general license, an industry/sector specific license or activity specific license. Business licenses are required by the legislation and administered by various government agencies, statutory bodies and local authorities. Business licenses include registrations, approvals, licenses and permits. The compliance requirements vary by industry, business activity and location.