Over the last decade and half, Malaysia has been positioning itself as a safe seat for arbitration. Until 2018 there was a consistent and continued effort to fuse the legislative framework with the best international practices. While the journey starts much earlier, real progress was made when back in 2002, I was honored to be part of the ad hoc committee set up by the Malaysian Bar Council together with Dato Bill Davidson and other legal luminaries to formulate a draft Arbitration Bill at the request of the then Attorney General.
This was enacted with modifications by AGC as the Arbitration Act 2005 (“the Act”). The Act brought an arbitral regime change and made Malaysia as a UNCITRAL Model Law jurisdiction. I continued my involvement in the arbitral legislative changes as KLRCA’s Director from 2010 to 2018.
Another stop gap amendment was made in 2011 to the Arbitration Act 2005. Unfortunately, it was not sufficient as case law as decided by the Courts started to show up deficiencies in maintaining Malaysia as a safe seat for arbitration. The then President of the Bar Council, Mr. Varghese George wrote to the then Minister of Law for urgent reinstatement of pre award interest and repeal of Section 42 by amending the Arbitration Act 2005 (Amended 2011).
As instructed by the then Government, KLRCA convened a consultative workshop of stake holders to discuss possible changes to the Arbitration Act 2005 (Amended 2011). In February and April 2018, further substantive amendments were accepted by the Government to incorporate the UNCITRAL 2006 proposals to the Model Law and also, change the name of Kuala Lumpur Regional Centre for Arbitration (KLRCA) to Asian International Arbitration Centre (AIAC).
Pleased to share the Malayan Law Journal 2020 article entitled Arbitration and Its Development in Malaysia  1 MLJ 1v. It traces the development of arbitration legislation as it was in Malaysia, how it came to be as it is today as the Arbitration Act 2005 (Amended 2011 and 2018).
The next publication, we’ll discuss the repeal of Section 42, why it was requested by the Malaysian Bar Council and the ramifications of the change.
Datuk Professor Sundra Rajoo
President of the Asian Institute of Alternative Dispute Resolution (AIADR)
26 August 2020
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