Originally from: International Commercial Arbitration in Asia - 3rd Edition

I. INTRODUCTION

Malaysia’s system of commercial dispute resolution is rooted in its common law heritage, and allows disputes to be resolved either publicly, through adjudication in court, or privately, through arbitration or other methods. Public dispute resolution remains the favoured process although there is a growing shift toward private resolution of commercial disputes, particularly those that have an international flavour because of the parties involved or other factors. This chapter deals with arbitration in Malaysia.

II. THE CONDUCT OF ARBITRATION IN MALAYSIA

A. The Historical Perspective

Since the chapter written in the previous edition of this publication, there has been a fundamental change in the arbitration laws in Malaysia. The Arbitration Act 19521 which formerly governed arbitration laws in Malaysia has been repealed and replaced by the Arbitration Act 20052 (“the 2005 Act”). This reform, which has taken more than 50 years since the Arbitration Act 1952, had been long overdue. Part of the delay in achieving this change was the debate between various factions involving the construction industry on whether the English Arbitration Act 19793 should be used as a model for the reform or whether reform should proceed on the basis of the UNCITRAL Model Law for international commercial arbitration. A subset of this debate was whether there should be two Acts, one dealing with domestic arbitrations and the other with international arbitrations or whether there should be one Act incorporating both regimes.