10 Dec The New Malaysian Arbitration Regime 2005 – MLJ August 2006

Malaysia enacted a new Arbitration Act 2005 (Act 646) on 30 December 2005 based on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration. The new Act repeals and replaces the previous Arbitration Act 1952 and the New York Convention enacted by Act 320 which dealt with the recognition and enforcement of international awards. It will be applicable to all arbitrations commenced after 15 March 2006, while the old 1952 Act will continue to apply to arbitral proceedings commenced before the operative date of the new Act.

While the old 1952 Act had the merits of simplicity and clarity, it was long outmoded. With the increasing popularity of arbitrations in Malaysia, there was more and more judicial grist exposing the infirmities, shortcomings and lacunae found in the old Act. The Malaysian Arbitration Act 2005 is to be applauded as it makes the long awaited and much needed change clamoured for by the business and arbitral communities in Malaysia. Arbitration law, practice and procedure will now see a major overhaul and it would therefore be timely for practitioners in the arbitration field to take a close look at the 2005 Act.