SERVICES EXPORT FUND
The Services Export Fund (SEF) is a scheme to provide assistance in the form of reimbursable grants, to Malaysian Service Providers (MSPs) for undertaking activities to venture into the international market through:

• Tendering or negotiating for international projects;
  
• Conducting pre-feasibility or feasibility studies for international projects; and
  
• Export promotion activities.
  

OBJECTIVES
The objectives of SEF are to:

• Expand exports of services by increasing the visibility and awareness of the expertise of MSPs in the global market;
  
• Brand MSPs as internationally competitive, competent and reliable; and
  
• Gather market intelligence through undertaking feasibility and other related studies which will assist Malaysian companies in securing projects overseas.
  

TYPES OF GRANTS
There are 4 types of grants available under SEF:

Grant 1 - For Participating in Tenders to Undertake Studies.
Grant 2 - For Participating in Tenders for Projects, or Preparing Negotiated Project Proposals *, to "Design", "Design-Build", "Design Build-Operate" and Design-Build-Operate-Maintain" projects.

Grant 3 - For Undertaking Pre-Feasibility and/or Feasibility Studies for:

• Foreign governments and their agencies;
  
• Owners of projects, endorsed by foreign government;
  
• International funding institutions such as the Islamic Development Bank, World Bank, Asian Development Bank, to benefit a third party; or
  
• Global institutions like the United Nations and their agencies, World Health Organization, International Red Cross and Red Crescent, to benefit a third party.
  

Grant 4 - For Export Promotion Activities

ELIGIBILITY CRITERIA

To qualify for the SEF Grant, MSPs must be:

• Firms incorporated under the Companies Act 1965,
  or
  
• Sole proprietors and partnerships registered with respective professional bodies;
  
• Having at least 60% Malaysian equity;
  
• For Grant 1, 2 and 3, applicant must also:
  a. Demonstrate experience and competency as a company or individual person to be an international service provider either individually or in consortia. Company must provide documentary evidence of past projects undertaken by the company or the individual; and
  b. Provide documentary evidence of the technical expertise available for undertaking projects overseas.
  
• For Grant 4, applicants must submit copy of latest audited account. For firms in operation less than 1 year, a copy of management account can also be submitted.
  
• Provide evidence of financial capability to undertake the activity as follows:
  

  a. Audited accounts for the preceding 3 years;

  b. If the applicant is not able to provide the audited account for the preceding year, the applicant may submit an unaudited account for the immediate preceding year.

  c. Company's account must show positive shareholders' fund and working capital;

  d. If the company is not able to meet condition (c), the following documents are accepted as evidence of financial capabilities to undertake the project;

  i. Company's latest 6 months bank statements with the average balance amount not less than 10% of the value of the grant applied;
  or
  ii. Directors' latest 6 months bank statements with the average balance amount not less than 10% of the value of the grant applied and letter of undertaking to provide personal financing to the company to undertake the tender/ proposal;
  or
  iii. Credit line or loan facility with local or foreign bank with facilities value of not less than 20% of the value of grant applied.

  e. For SMEs that are sole proprietors or partnerships that are registered with the respective professional bodies that do not have audited accounts, the followings can be accepted as evidence of financial capabilities:

  i. Firm latest 6 months bank statements with the average balance amount not less than 10% of the value of the grant applied;
  or
  ii. Individual partners latest 6 months bank statements with the average balance amount not less than 10% of the value of the grant applied and letter of undertaking to provide personal financing to the company to undertake the tender/ proposal;
  or
  iii. Credit line or loan facility with local or foreign bank with facilities value of not less than 20% of the value of grant applied.

  f. For companies in operation less than 1 year, the management account can be submitted.
  

SECTORS ELIGIBLE FOR THE GRANT

GRANT 1 - FOR PARTICIPATING IN TENDERS FOR STUDIES

Under this grant, MSPs can apply for 50 per cent reimbursement of approved eligible expenses in the preparation and submission of tenders for eligible project studies. This relates specifically to the costs in preparing and submitting tenders to do studies, and not the cost of actually undertaking the study itself.

Studies eligible for this grant include:

• Pre-Feasibility Studies
  
• Feasibility Studies
  
• Privatisation Studies
  
• Project Management Studies
  
• Project Formulation Studies
  
• Project Audits

GRANT 2 - FOR PARTICIPATING IN TENDERS FOR PROJECTS or PREPARING NEGOTIATED PROJECT PROPOSALS

Under this grant, MSPs can apply for the reimbursement of 50 percent of eligible expenses incurred in the preparation and submission of tenders and proposals only if the company is unsuccessful in winning the bid, or the negotiated project. These grant are for "Design", "Design-Build", "Design Build-Operate" and Design-Build-Operate-Maintain" projects.

GRANT 3 - TO UNDERTAKE PRE-FEASIBILITY AND FEASIBILITY STUDIES

Under this grant, MSPs can apply for reimbursement up to 100% of the eligible cost of pre-feasibility and feasibility studies. The funding of the studies can take any of the following forms:

• Fully funded through the SEF;
  
• Jointly funded by the SEF and the foreign government or its agencies;
  
• Jointly funded by the SEF and the owner of the project which is endorsed by the foreign government or its agencies;
  
• Jointly funded by the SEF and global and international financing institutions.

ELIGIBLE ACTIVITIES AND EXPENSES FOR GRANT 1, 2 AND 3

The expenses and activities covered under the grants are:

1. Purchase of bid documents
2. Travel and accommodation expenses related to bid briefings, technical visits and consultative meetings with potential clients.

Expenses covered:

• Costs of travel for not more than 15 trips. Air travel will be for economy class. Visa fees, excess baggage claims and insurance are not eligible for claims.
  
• Accommodation for a maximum of 21 nights, for the entire bidding process. Hotel accommodation limited to one room per person, not exceeding RM 1000 per night.
  
• Reasonable cost of related local expenses, such as car rentals, taxi fares and cost of engaging a local guide and interpreter.

3. Approved Costs Related To Fact-Finding and Market Research

Costs associated with fact-finding and market research in the targeted market which is relevant to the bid. These include:

• Surveys relevant to the tender bid preparation and submission. These surveys include geotechnical, hydrological and ground surveys;
  
• Purchase of market reports and related information
  
• Related expenses on research and local studies
  

4. Approved Design Costs

Expenses incurred for:

• Schematic designs
  
• Computer-aided animation
  
• Video presentation
  
• Technical drawing costs
  

5. Staff Costs

The fees and cost of professional, sub-professional and administrative support staff directly involved with the preparation of the proposal. All approved cost must be in accordance with the latest Treasury Guidelines on Government Procurement for Consultancy Services. Copy of the guidelines is available at Treasury's website: www.treasury.com.my

6. Scale and Mock-Up Model Costs
The cost of preparing and constructing bidding level scale models by third party or existing staff. For the existing staff, the cost will be on man-months x charging rate.

7. Printing, Binding and Transmittal Costs

The eligible expenses include:

• Legal and Translation costs
  
• Printing and Binding costs
  
• Courier and Postage costs
  
• Telephone, telegram, telex and facsimile costs

GRANT 4 - FOR EXPORT PROMOTION ACTIVITIES

Under this grant, MSPs can obtain a 50% reimbursable grant on the approved cost of the eligible activities. Eligible activities are as follows:

1. Participation in International Trade Fairs.

2. Participation in Trade and Investment Missions (T&I) and Specialised Marketing Missions (SMM).

3. Participation in Industry Related International Conferences Overseas.

4. Participation in meetings related to negotiations on Mutual Recognition Agreement (MRA), Free Trade Agreement (FTA), ASEAN, World Trade Organization (WTO) and other market access negotiations by representatives of Trade and Industry Associations and Professional Bodies.

5. Preparation of Promotional Materials.

6. Export Market Research

7. Initial Cost of Setting up Office Overseas, for the purpose of:

• undertaking activities for promotion of Malaysian products and services;
  
• seeking opportunity for outsourcing and subcontracting business;
  
• to undertake research on the market; and
  
• to undertake and monitor implementation of projects and contracts.
  

CLAIMABLE EXPENSES

1. Participation in International Trade Fairs.

• Participation fee;
  
• Economy class airfare for one person. Cost does not include items such as visa fees, excess baggage and insurance premium;
  
• One hotel room not exceeding RM200 per night for local international trade fairs, and RM1,000 per night for overseas fairs;
  
• Payment will cover the duration of the event and 2 additional days;
  
• Rental of standard booth which is limited to 18 m2;
  
• Construction and enhancement of standard booth or shared cost of construction on group basis;
  
• Interpreter services for non-English speaking countries of the international trade fair limited to RM1,000 for the duration of the fair;
  
• Shipment of exhibits and promotional materials. Cost does not include items such as import duties, bank guarantee and surcharge;
  
• For local international trade fair sending of samples and promotional materials is subject to a maximum cost of RM2,000;
  
• Standard advertisement in trade fair show directory;
  
• For claims related to participation in Local International Trade Fair, company must submit a copy of the event report from the fair organizer, which has been certified by an external auditor. The report must certify that the fair has fulfilled the criteria of an international trade fair, as follows:
  
  o minimum space occupied for the fair must be at least 1,000 m2 gross,
  and
  o at least 10% of visitors must be foreign visitors, or
  o at least 20% net space is rented to foreign exhibitors, or
  o at least 20% of exhibitors are foreign exhibitors.
  

2. Participation in Trade and Investment Missions and Specialised Marketing Missions.

• Participation fee;
  
• Economy class airfare for one person. Cost does not include items such as visa fees, excess baggage and insurance premium; and
  
• One hotel room not exceeding RM1,000 per night. Payment will cover the duration of the event and two days before or after the event.

3. Participation in Industry Related International Conferences Overseas.

• Participation or registration fee;
  
• Economy class airfare for one person. Cost does not include items such as visa fees, excess baggage and insurance premium; and
  
• One hotel room not exceeding RM1,000 per night. Payment will cover the duration of the conference and two days before or after the conference.
  

4. Participation in meetings related to negotiations on Mutual Recognition Agreement (MRA), Free Trade Agreement (FTA), ASEAN, World Trade Organization (WTO) and other market access negotiations by representatives of Trade and Industry Associations and Professional Bodies.

• Economy class airfare for one person; and
  
• One hotel room not exceeding RM1,000 per night covering the duration of the meeting and two days before or after the meeting.
  

5. Preparation of Promotional Materials.

• Companies are eligible for a maximum grant of RM15,000 for preparation of export promotion materials;
  
• Cost incurred in relation to the production of promotional materials such as brochures, catalogues, flyers, banners, posters and CD-ROM;
  
• Eligible expenses include:
  
• For printed materials:-

  o Design concept
  o Finished Artwork
  o Colour separation
  o Printing
  o Re-printing (For Trade fairs or Trade mission only)
  

• Production of CD ROM and Video can be considered for SEF only if it is part of the company's participation in trade fairs or trade missions.
  o Content of text, audio, video, photography, graphic, animation, etc.
  o Design
  o Development
  o Replication and Production of CD-ROM packaging
  

• Companies must use the services of local printing and CD-ROM companies to benefit from this grant.
  

6. Export Market Research

• Companies are eligible for a maximum grant of RM30,000 per export market study conducted overseas.
  
• Eligible expenses are:
  o Research fees
  o Cost of publication of initial report
  

7. Initial Cost of Setting Up Office Overseas.

• Companies are eligible for a maximum grant of RM100,000 per office or the initial Six (6) months set up cost of the office (which ever is earlier);
  
• Eligible expenses are:
  o Rental of office and Utilities (does not cover deposits);
  o Salaries of support staff excluding allowance and bonuses.

MSPs ELIGIBLE FOR THE SEF GRANTS

For Grant 4, all services sectors are eligible except for Financial Services, Tourism Sector and Property Development.

APPLICATION PROCEDURE

• Application for Grant 1, 2 and 3 must be made using the SEF Grant Application form SEF 1/07 Rev. 3. (Download Form)
  
• Application for Grant 4 must be made using the SEF Grant Application form SEF/PROMOTION/08. (Download Form)
  These forms can be downloaded from MATRADE's website, www.matrade.gov.my.
  
• All supporting documents needed to for the applications are described in the checklist attached to the form SEF 1/07 Rev. 3 and SEF/PROMOTION/08. Applicants must submit all relevant documents when applying for the grant.
  
• The SEF Grant Approval Committee will take into account the following additional factors when considering applications for Grant 1, 2 and 3:
  o the risk assessment of the country in which the project is located;
  o the need to utilise to the fullest extent Malaysian expertise and technology;
  o the viability of the project to be undertaken;
  o the potential for downstream benefits and commercial linkages; and
  o the extent to which Malaysia's image as a supplier of quality products and services will be enhanced.
  
• Successful applicants for Grant 1, 2, and 3 will be required to sign a Letter of Acceptance with MATRADE. This document confirms:
  o the acceptance and full compliance with the conditions attached to the grant;
  o that MATRADE has the right to cancel the approval of the grant and seek reimbursement of the grant funds disbursed, in the event of a breach of the conditions attached to the grant; and
  o that the grant beneficiary undertakes to complete the bidding process and report on the progress and outcome.
  
• Reimbursements of eligible expenses will be based on actual proof of expenditure. Grant beneficiaries must submit original or certified true copies by external auditors of documents as evidence of payments within 3 months of incurring the expenditures.

FOR FURTHER CLARIFICATION PLEASE CONTACT:

Services Export Fund Unit
Services Section
Product and Services Development Division
Malaysia External Trade Development Corporation
Level 15, East Wing,
Menara MATRADE
Jalan Khidmat Usaha, Off Jalan Duta
50480 Kuala Lumpur

Tel: 603 - 6207 7077 Fax: 603 - 6203 7260
Email: info@matrade.gov.my