Q. Is there any shared hosting plan with ffmpeg support?
A. I googled for you and yes, the first entry is
Planhoster.com - Reliable, Secure and User Friendly Web Hosting & Domain Services :: Home and there are probably many others.
Q. What are the laws like in Malaysia?
A. That's asking too much. Ask a lawyer.
Q. Is adult material hosting allowed?
A. Depends what you mean by adult material. Wikipedia-type adult materials are obviously allowed. But I guess you mean porn. Porn is illegal in Malaysia so if you intend to host one, host it in other countries otherwise you may wake up one day to find your site gone, hehehe.
Q. What is policy on user generated content/file sharing sites ?
A. Policy is still policy, whether it is file sharing sites or otherwise.