Lega l He r a ld . NOVEMBER 2015 7
An Overview of Arbitration
|by Dato’ Nitin Nadkarni and Darshendev Singh|
1. EXECUTIVE SUMMARY
1.1 What are the advantages and disadvantages
relevant to arbitrating or bringing arbitrationrelated
proceedings in your jurisdiction?
● Malaysia is a signatory to the 1958 Convention on
Recognition and Enforcement of Foreign Arbitral
Awards (New York Convention). As such, an arbitral
award from Malaysia is enforceable in more than
● The Malaysian Arbitration Act 2005 (AA) is modelled
on the UNCITRAL Model Law on International
Commercial Arbitration 1985 (with amendments as
adopted in 2006) (Model Law) and the New Zealand
Arbitration Act 1996.
● Malaysia is a common law jurisdiction, and
the Malaysian courts regard decisions by
Commonwealth courts as highly persuasive,
particularly in commercial matters.
● Sections 11 and 19 of the AA give the courts and
arbitral tribunals, respectively, the power to order
interim measures. Pursuant to section 19 of the AA,
arbitral tribunals have the power to order security for
costs, discovery of documents and interrogatories,
giving of evidence by affi davit, and the preservation,
interim custody or sale of any property which is the
subject matter of the dispute.
● Arbitral immunity: section 47 of the AA expressly
provides that an arbitrator shall not be liable for
any act or omission in respect of anything done or
omitted to be done in the discharge of his or her
functions as an arbitrator unless the act or omission
is shown to have been in bad faith.
● Unless otherwise agreed by the parties, no person
shall be precluded by reason of nationality from
acting as an arbitrator: section 13 of the AA.
● In applying to set aside an arbitral award, the
members of the arbitral tribunal are not named as a
party to the application.
● Foreign lawyers are allowed to appear in arbitral
proceedings both as counsel and as arbitrator.
● According to the website of the Kuala Lumpur
Regional Centre for Arbitration, there is no
withholding tax imposed on arbitrators (see http://
● Cost effectiveness: arbitrations are cheaper to hold
in Malaysia than in neighbouring countries.
● According to the website of the Kuala Lumpur
Regional Centre for Arbitration, foreign arbitrators
do not need a work permit or a professional visit
pass when conducting an arbitration in Malaysia for
a short duration (see http://klrca.org/about/).
● There is minimal judicial intervention with respect to
arbitral proceedings. Section 8 of the AA expressly
states that “No court shall intervene in matters
governed by this Act, except where so provided in
this Act”. Pursuant to section 10 of the AA, a court
must stay proceedings that are the subject matter of
an arbitration unless the parties have already taken
steps in the court proceedings, or the arbitration
agreement is null and void, inoperative or incapable
of being performed.
● An award shall be final and binding on the parties,
and it may be relied upon by any party by way of
defence, set-off or otherwise in any proceedings in
any court (section 36 (1), AA).
Lega l He 8 r a ld . NOVEMBER 2015
● An arbitral award can only be set aside in exceptional
circumstances. This is discussed in Section 5.1 below.
● The Malaysian courts have repeatedly held that
an arbitral award is conclusive and can only
be challenged in exceptional circumstances. In
particular, international awards (which include any
award where one party is not Malaysian) can only be
challenged on the grounds set out in the New York
Convention. An award will not be set aside merely
because of the failure of an arbitrator to draw correct
inferences of fact.
● The Kuala Lumpur Regional Centre for Arbitration
(KLRCA) is the primary venue for international
arbitration proceedings held in Malaysia. The
KLRCA has excellent modern facilities, including
• 3 large hearing rooms (up to 22 persons);
• 10 medium hearing rooms (up to 14 persons);
• 5 small hearing rooms (up to 10 persons);
• 15 breakout rooms;
• seminar room;
• auditorium (up to 182 persons);
• business centre;
• arbitrator’s lounge;
• specialised alternative dispute resolution &
construction law library;
• advanced video conferencing equipment;
• ultramodern court recording & transcription
• private dining room;
• outdoor cafeteria; and
• library and resource centre.
1.2 How would you rate the supportiveness of
your jurisdiction to arbitration on a scale
of 1 to 5, with the number 5 being highly
supportive and 1 being unsupportive of
arbitration? Where your jurisdiction is in
the process of reform, please add a + sign
after the number.
Malaysia has become an arbitration-friendly jurisdiction
and we would rate it as a 5.
2. GENERAL OVERVIEW AND NEW
2.1 How popular is arbitration as a method of
settling disputes? What are the general
trends and recent developments in your
Arbitration has been increasingly used as a method
of dispute resolution in Malaysia. Originally used in
construction disputes, it is becoming increasingly popular
for commercial dispute resolution. The enactment of the
Model Law in the form of the 2005 Arbitration Act, which
replaced the outdated 1952 Arbitration Act, has increased
public confidence in, and adoption of, the arbitral process.
Consistent with the experience in other jurisdictions,
we anticipate that the mandating of adjudication in
construction disputes by the Construction Industry
Payment and Adjudication Act 2012 will lead to a
reduction in construction-related disputes being referred
2.2 Are there any unique jurisdictional
attributes or particular aspects of the
approach to arbitration in your jurisdiction
that bear special mention?
Due to the colonial heritage and the large number of
students who receive their tertiary education in England
and Australia, English is the main language of both
law and business in Malaysia, and most commercial
arbitrations are conducted in English. However, Malaysia
is a multiracial country and its arbitrators can converse
in English, Malay, Tamil, Mandarin and/or Chinese
dialects. Translators and interpreters are also widely
available. Pursuant to section 24 of the AA, the parties
are free to agree on the language to be used in the arbitral
Lega l He r a ld . NOVEMBER 2015 9
2.3 Principal laws and institutions
2.3.1 What are the principal sources of law and
regulation relating to international and domestic
arbitration in your jurisdiction?
The principal source of law and regulation relating to
international and domestic arbitration is the AA. The AA
is based on the Model Law. Malaysia is a signatory to the
New York Convention, key provisions of which have been
adopted in the AA.
Unless the parties to an international arbitration agree,
Part III of the AA (further explained below) shall not
apply to that arbitration. Conversely, unless the parties
to a domestic arbitration otherwise agree, Part III shall
apply to the domestic arbitration. The parties may agree
to apply or exclude the application of Part III of the AA in
whole or in part.
Part III of the AA comprises seven sections (sections 40–
46) of the AA, which deal with:
• Consolidation of proceedings and concurrent
• Determination of preliminary points of law by the
High Court in the course of the arbitration with
the consent of the arbitral tribunal or every other
party to the arbitration.
• Reference to the High Court of any question of
law arising out of the arbitral award.
• Appeal against the decision of the High Court on
the question of law arising out of the arbitral award.
• Costs and expenses of the arbitration.
• Extension of time for the commencement of
• Extension of time for the making of an arbitral
Malaysia is a party to the ICSID Convention.
2.3.2 Which are the principal institutions that are
commonly used and/or government agencies
that assist in the administration or oversight of
international and domestic arbitrations?
The principal institution that both administers and
commonly provides a venue for commercial arbitrations
in Malaysia is the KLRCA. The KLRCA maintains its
own rules of arbitration, which are a modification of
the UNCITRAL. Rules of Arbitration. The KLRCA also
maintains, amongst others, the following rules:
• i-Arbitration rules, for arbitration of disputes
arising from commercial transactions premised
on Islamic principles. The rules incorporate
a reference procedure to a Shariah Advisory
Council or Shariah expert whenever the arbitral
tribunal has to form an opinion on a point related
to Shariah principles.
• Fast track arbitration rules, designed for parties
who wish to obtain an award in the fastest way
with minimal costs.
The KLRCA was established in 1978 under the auspices
of the Asian-African Legal Consultative Organization. The
KLRCA was the first regional centre established in Asia to
provide institutional support as a neutral and independent
venue for the conduct of domestic and international
arbitration proceedings in Asia. It was also the first centre
in the world to adopt the UNCITRAL Arbitration Rules as
revised in 2010. The KLRCA has developed new rules
to cater for the growing demands of the global business
community, such as the KLRCA i-Arbitration Rules and
the KLRCA Fast Track Rules, as well as Mediation and
Conciliation Rules. The KLRCA has won several awards,
including the prestigious Global Arbitration Review Award
for ‘innovation by an individual or organisation in 2012’.
KLRCA has a panel of over 700 experienced domestic
and international arbitrators.
Besides the KLRCA, arbitrations are also administered
by a number of other bodies, including the Institute of
Engineers Malaysia, Kuala Lumpur and Selangor Chinese
Chambers of Commerce, Malaysian Rubber Board,
Palm Oil Refiners Association of Malaysia, Institution
of Surveyors, the Malaysian International Chambers of
Commerce and the Malaysia Institute of Architects.
Lega l He 10 r a ld . NOVEMBER 2015
2.3.3 Which courts or other bodies have judicial
oversight or supervision of the arbitral process?
The High Court has judicial oversight and supervision of
the arbitral process in Malaysia. An arbitral award that
is made in West Malaysia falls under the jurisdiction of
the High Court of Malaya. An arbitral award that is made
in East Malaysia falls under the jurisdiction of the High
Court of Sabah & Sarawak. An appeal from either of
the courts would be made to the Court of Appeal. The
Federal Court, the highest court, has the jurisdiction to
hear an appeal from the Court of Appeal, but only when
leave has been granted. Leave to appeal to the Federal
Court will only be granted if the decision of the Court of
Appeal raises questions of general principle on which the
Federal Court has not previously decided or questions of
importance upon which further argument and a decision
of the Federal Court would be to the public’s advantage.
3. ARBITRATION IN YOUR JURISDICTION —
3.1 The appointment of an arbitral tribunal
3.1.1 Are there any restrictions on the parties’
freedom to choose arbitrators?
The parties are free to choose the arbitrators. However,
pursuant to section 14 of the AA, an arbitrator’s
appointment may be challenged if there are circumstances
likely to give rise to justifiable doubts as to that person’s
impartiality or independence, or if that person does not
possess qualifications agreed to by the parties. A party
may challenge an arbitrator appointed by the same party,
or in whose appointment that party has participated, only
for reasons of which that party becomes aware after the
appointment has been made.
Foreign lawyers are allowed to appear in arbitral
proceedings both as counsel and arbitrators. Pursuant
to section 13 of the AA, unless otherwise agreed by
the parties, no person shall be precluded by reason
of nationality from acting as an arbitrator. There is no
requirement that an arbitrator must be a member of the
3.1.2 Are there specific provisions of law regulating
the appointment of arbitrators?
Pursuant to section 12(1) of the AA, the parties are free to
determine the number of arbitrators. Pursuant to section
13 of the AA, the parties are free to agree on a procedure
for appointing the arbitrator or the presiding arbitrator.
3.1.3 Are there alternative procedures for appointing
an arbitral tribunal in the absence of agreement
by the parties?
Either party may apply to the Director of the KLRCA for
appointment of the party-appointed arbitrator(s), presiding
arbitrator and/or sole arbitrator pursuant to section 13 of
the AA. Should the Director of the KLRCA fail to act within
30 days from the application, any party may apply to the
High Court for such appointment. Pursuant to section
12(2) of the AA, should the parties fail to determine the
number of arbitrators, the arbitral tribunal shall consist of
three arbitrators (in the case of an international arbitration)
or a single arbitrator (in the case of a domestic arbitration).
3.1.4 Are there requirements (including disclosure)
for “impartiality” and/or “independence”,
and do such requirements differ as between
domestic and international arbitrations?
Pursuant to section 14(1) of the AA, a person who is
approached in connection with that person’s possible
appointment as an arbitrator shall disclose any
circumstances likely to give rise to justifiable doubts as
to that person’s impartiality or independence. This duty to
disclose shall continue until the final award is rendered.
In this regard, section 14(2) of the AA places the duty
on the arbitrator to disclose to the parties, without delay,
from the time of appointment and throughout the arbitral
proceedings, any circumstances that are likely to give
rise to justifiable doubts as to his or her impartiality or
independence, unless the parties have already been
informed of such circumstances by the arbitrator.
These requirements do not differ between domestic and
Lega l He r a ld . NOVEMBER 2015 11
3.1.5 Are there provisions of law governing the
challenge or removal of arbitrators?
Yes, sections 14–17 of the AA govern challenges to, and
removal of, arbitrators. An arbitrator may be challenged
only if the circumstances give rise to justifiable doubts as
to his or her impartiality or independence, or he or she
does not possess qualifications agreed to by the parties
(section 14(3), AA).
Unless otherwise agreed by the parties, the party who
intends to challenge an arbitrator shall, within 15 days
after becoming aware of the constitution of the arbitral
tribunal or of any reasons referred to in section 14(3)
of the AA, send a written statement of the reasons for
the challenge to the arbitral tribunal (section 15(1), AA).
The words “Unless otherwise agreed by the parties” in
section 15(1) of the AA signify that the parties can agree
to a procedure for the challenge of arbitrator. Most rules
of arbitration maintained by the arbitral institution set out
their respective challenge procedures.
The arbitral tribunal shall then make a decision on the
challenge, unless the challenged arbitrator withdraws
from office or the other party agrees to the challenge.
If the challenge is not successful, the challenging party
may, within 30 days after having received notice of the
decision rejecting the challenge, apply to the High Court
to make a decision on the challenge. The decision of the
High Court shall be final and no appeal may be made.
If the challenge is successful, it appears that the other
party does not have a right to appeal to the High Court
against the decision.
Where an arbitrator becomes in law or in fact unable
to perform the functions of that office, or for any other
reason fails to act without undue delay, that arbitrator’s
mandate terminates on withdrawal from office or if the
parties agree on the termination. If any party disagrees
on the termination, either party may apply to the High
Court to decide on such termination and no appeal shall
lie against the decision of the High Court.
Where an arbitrator withdraws from office or a party
agrees to the termination of the mandate of an arbitrator,
it shall not imply acceptance of the validity of any of the
• The circumstances give rise to justifiable doubts
as to that arbitrator’s impartiality or independence.
• The arbitrator does not possess qualifications
agreed to by the parties.
• The arbitrator is in law or in fact unable to perform
the functions of that office, or for other reasons
fails to act without undue delay.
A substitute arbitrator shall be appointed where the
mandate of an arbitrator terminates, an arbitrator
withdraws from office for any other reason, the mandate
of the arbitrator is revoked by agreement of the parties
or in any other case of termination of mandate. Where a
single or the presiding arbitrator is replaced, any hearings
previously held shall be repeated before the substitute
arbitrator. Where an arbitrator other than a single or the
presiding arbitrator is replaced, any hearings previously
held may be repeated at the discretion of the arbitral
For the avoidance of any doubt, any order or ruling made
by the arbitral tribunal prior to the replacement of an
arbitrator shall not be invalid solely on the ground that
there has been a change in the composition of the arbitral
3.1.6 What role do national courts have in any such
See Section 3.1.5 above.
3.1.7 What principles of law apply to determine the
liability of arbitrators for acts related to their
Section 47 of the AA expressly provides that an arbitrator
shall not be liable for any act or omission in respect of
anything done or omitted to be done in the discharge of
his functions as an arbitrator unless the act or omission is
shown to have been in bad faith.
Lega l He 12 r a ld . NOVEMBER 2015
3.2 Confidentiality of arbitration proceedings
3.2.1 Is arbitration seated in your jurisdiction
confidential? What are the relevant legal or
institutional rules which apply?
Although there is no statutory provision contained in the
AA which declares arbitration proceedings as confidential,
it is not uncommon for parties to enter into an arbitration
agreement on the basis that all matters relating to the
arbitral proceedings shall be kept confidential.
In the absence of such a confidentiality clause in the
arbitration agreement, the Malaysian courts would most
likely imply an obligation of confidentiality in the arbitration
agreement. Most confidentiality clauses are adopted in
the arbitration agreement by adopting a set of arbitral
institutional rules which contains such a clause. For
example, Rule 15, Part 1 of the KLRCA 2013 arbitration
rules expressly provides for confidentiality.
3.2.2 To what matters does any duty of confidentiality
extend (for example, does it cover the existence
of the arbitration, pleadings, documents
produced, the hearing and/or the award)?
This will depend on any confidentiality agreement entered
into by the parties, as there is no relevant statutory
3.2.3 Can documents or evidence disclosed in
arbitration be used in other proceedings or
Unless otherwise expressly agreed between the parties
or if they are in the public domain, documents or
evidence disclosed in arbitration cannot be used in other
proceedings or contexts. As mentioned in Section 3.2.1
above, in the absence of a confidentiality agreement
relating to the arbitration, the Malaysian courts would
most likely imply an obligation of confidentiality in the
However, pursuant to section 36(1) of the AA, the award
made by an arbitral tribunal may be relied upon by any
party to the arbitral proceeding by way of defence, set-off
or otherwise in any proceedings in any court.
3.2.4 When is confidentiality not available or lost?
Confidentiality is lost if the parties waive such
confidentiality or the court makes an order granting
permission to disregard it. Confidentiality is not available
in respect of documents in the public domain.
Documents filed in the courts and read out in open court
are public documents. Thus matters relating to an arbitral
proceedings may lose their confidentiality if the award is
challenged and the arbitration documents are produced in
the High Court.
3.3 Role of (and interference by) the national
courts and/or other authorities
3.3.1 Will national courts stay or dismiss court
actions in favour of arbitration?
Section 8 of the AA expressly states that “No court shall
intervene in matters governed by this Act, except where
so provided in this Act”.
Pursuant to section 10 of the AA, it is mandatory for the
Malaysian courts to stay any court proceedings which
are the subject of an arbitration agreement in favour of
arbitration. A stay will be refused if:
• The party applying for a stay of proceedings has
taken definite, conscious and deliberate steps to
participate in the court proceedings.
• The arbitration agreement is null and void,
inoperative or incapable of being performed.
3.3.2 Are there any grounds on which the national
courts will order a stay of arbitral proceedings?
Lega l He r a ld . NOVEMBER 2015 13
The courts are unlikely to order a stay of the arbitral
proceedings unless the arbitral tribunal has no jurisdiction.
The procedure for challenging jurisdiction is discussed in
Section 3.6.3 below.
3.3.3 What is the approach of national courts to
parties who commence court proceedings in
your jurisdiction or elsewhere in breach of an
agreement to arbitrate?
The courts have consistently favoured arbitrations as
the parties’ choice of dispute resolution. The power of
the court to grant a stay of its proceedings in favour of
arbitration is discussed in Section 3.3.1 above.
Besides granting a stay of the court proceedings, antisuit
injunctions restraining a party from commencing
court proceedings in other jurisdictions in breach of an
arbitration agreement which provides Malaysia as the
seat of arbitration may be granted by the courts.
3.3.4 Is there a presumption of arbitrability or policy
in support of arbitration? Have national courts
shown a willingness to interfere with arbitration
proceedings on any other basis?
Pursuant to section 4(1) of the AA, any dispute which
the parties have agreed to submit to arbitration under an
arbitration agreement may be determined by arbitration
unless the arbitration agreement is contrary to public
policy. The public policy of Malaysia may differ from that of
another jurisdiction and must be considered in a Malaysian
context. There is a presumption of arbitrability which is
qualified by public policy requirements. In practice, the
courts will presume arbitrability of commercial disputes
(except gaming contracts).
As mentioned in Section 3.3.3 above, the courts have
consistently favoured arbitrations. Pursuant to section 8
of the AA, the national courts cannot intervene in matters
governed by the AA except where so provided in the AA.
As such, it is unlikely that the courts will interfere with
arbitration proceedings on any basis other than lack of
jurisdiction. Accordingly, it is unlikely that arbitrations will
be delayed or frustrated by reason of interference by the
It should be noted that, pursuant to section 5, the AA
applies with equal force to any arbitration to which the
Federal Government or any state government is a party.
3.3.5 Are there any other legal requirements for
arbitral proceedings to be recognisable and
There are no legal requirements for arbitral proceedings
to be recognisable and enforceable save for section 4(1)
of the AA, which provides that any dispute which the
parties have agreed to submit to arbitration under an
arbitration agreement may be determined by arbitration
unless the arbitration agreement is contrary to public
policy, and section 10 of the AA, which makes it mandatory
for the courts to stay the court proceedings in favour of
arbitration. The definition of an arbitration agreement is
contained in section 9 of the AA and discussed in Section
3.6.1 below. Pursuant to section 38 of the AA, an award
made in Malaysia or any other state which is a contracting
party to the New York Convention is recognised and
enforceable in Malaysia.
3.4 Procedural flexibility and control
3.4.1 Are specific procedures mandated in particular
cases, or in general, which govern the
procedure of arbitrations or the conduct of an
arbitration hearing? To what extent can the
parties determine the applicable procedures?
Pursuant to section 21(1) of the AA, the parties are free
to agree on the procedure to be followed by the arbitral
tribunal subject to the provisions of the AA. Where the
parties do not agree on a procedure, the arbitral tribunal
may, subject to the provisions of the AA, conduct the
Lega l He 14 r a ld . NOVEMBER 2015
arbitration in such manner as it considers appropriate. In
this regard, the power conferred upon the arbitral tribunal
shall include the power to:
• Determine the admissibility, relevance, materiality
and weight of any evidence.
• Draw on its own knowledge and expertise.
• Order the provision of further particulars in a
statement of claim or statement of defence.
• Order the giving of security for costs.
• Fix and amend time limits within which various
steps in the arbitral proceedings must be
• Order the discovery and production of documents
or materials within the possession or power of a
• Order the interrogatories to be answered.
• Order that any evidence be given on oath or
• Make such other orders as the arbitral tribunal
In any event, at all times, the parties shall be treated
with equality and each party shall be given a fair and
reasonable opportunity of presenting that party’s case
(section 20, AA). This means that the arbitral tribunal
must follow the rules of natural justice.
It is increasingly the norm that parties agree to adopt
institutionalised rules in commercial disputes.
There are default legislative provisions governing
procedures in the AA. These include:
• The application of Part III of the AA to domestic
• When a written communication is deemed to
have been received.
• The procedure for the appointment and number
• Challenge procedures.
• The power of the arbitral tribunal to grant interim
• Determination of the seat of arbitration.
• Submission of statements of claim and defence.
• Hearing procedure.
• When is an arbitral proceeding deemed to have
• Decision making by panel of arbitrators.
3.4.2 Are there any requirements governing the place
or seat of arbitration, or any requirement for
arbitral hearings to be held at the seat?
Pursuant to section 22 of the AA, the parties are free to
agree on the seat of arbitration. However, if the parties
fail to agree on the seat, the seat shall be determined by
the arbitral tribunal having regard to the circumstances
of the case, including the convenience of the parties.
There is no requirement that the arbitral hearings must
be held at the seat. The parties are free to agree the
place at which the arbitral hearings are to be held. Unless
otherwise agreed by the parties, the arbitral tribunal may
meet at any place it considers appropriate for consultation
among its members, for hearing witnesses, experts or
the parties, or for inspection of goods, other property or
documents (section 22(3), AA). It is not uncommon for
arbitral proceedings in Malaysia to be held at the KLRCA.
3.4.3 What procedural powers and obligations does
national law give or impose on an arbitral
The procedural powers and obligations that the national
law give or impose on an arbitral tribunal are those set
out in the AA. Amongst others, the arbitral tribunal has
powers to grant interim measures pursuant to section 19
of the AA (discussed in Section 4.1 below). The arbitral
tribunal also has the power to determine the challenge
made to an arbitrator (section 15, AA), determine its
own jurisdictions (section 18, AA), determine the rules
of procedure (section 21, AA), determine the seat of
arbitration (section 22, AA), determine the language of the
arbitration (section 24, AA), decide on the admissibility of
evidence, and so on. Unless otherwise agreed, an award
must be reasoned.
Lega l He r a ld . NOVEMBER 2015 15
22.214.171.124 What is the general approach to the gathering
and tendering of written evidence at the pleading
stage and at the hearing stage?
Pursuant to section 21(1) of the AA, the parties are
free to agree on the procedure to be followed by the
arbitral tribunal in conducting the arbitral proceedings. In
international arbitrations, it is not uncommon for memorialstyle
directions to be adopted, with each party submitting
sequentially its pleadings, witness statements, documents
and experts' reports. In domestic arbitrations, parties
commonly adopt similar procedures to those followed by
common law courts. This would involve the sequential
exchange of pleadings, followed by the simultaneous
exchange of documents, witness statements and experts’
reports. Increasingly, general discovery is not ordered,
but parties are at liberty to seek specific discovery of
Unless parties agree otherwise, the arbitral tribunal must
have an oral hearing at the request of either party. During
the oral hearing, witness statements are generally taken
as read and the witnesses will be tendered for crossexamination.
It is not uncommon for the evidence of the experts to
be recorded subsequent to the evidence of the factual
witnesses of both parties. At the close of the hearing,
directions would normally be given as to the submissions
of the post-hearing submission, replies to the posthearing
submission and submission on cost. Thereafter,
if necessary, the arbitral tribunal may require the parties
to appear before it for oral submissions before rendering
The Malaysian Evidence Act 1950 does not apply to
arbitration proceedings (section 2, Malaysian Evidence
Act 1950). As such, it is not uncommon for international
arbitrations to adopt the International Bar Association
Rules on the Taking of Evidence in International
Arbitration (revised in 2010) (IBA Rules on Evidence) and
for domestic arbitration to use the IBA Rules on Evidence
as a guide. Documents which are protected by legal
professional privilege are generally not admissible as
126.96.36.199 Can parties agree the rules on disclosure? How
does the disclosure in arbitration typically differ to
that in litigation?
Yes, the parties can agree the rules on disclosure pursuant
to section 21(1) of the AA. As mentioned in Section 188.8.131.52
above, it is not uncommon for international arbitrations
held in Malaysia to adopt the IBA Rules on Evidence,
which also set out procedures for disclosure. Generally,
disclosure in arbitration is less extensive than in litigation.
184.108.40.206 What are the rules on oral (factual or expert
witness) evidence? Is cross-examination used?
See Section 220.127.116.11 above. It is not uncommon for the
evidence of expert witnesses to be recorded after the
evidence of the parties’ respective factual witnesses.
There have also been instances where the “hot-tubbing”
method has been applied. Pursuant to section 21(3)(h) of
the AA, the arbitral tribunal may order that the evidence be
given on oath or affirmation. This may include evidence in
the form of affidavits or sworn witness statements.
18.104.22.168 If there is no express agreement, what powers
of compulsion are there for arbitrators to require
attendance of witnesses (factual or expert) or
production of documents, either prior to or at
the substantive hearing? To what extent are
national courts willing or able to assist? Are there
differences between domestic and international
arbitrations, or between orders sought as against
parties and non-parties?
Pursuant to section 29 of the AA, any party with the
approval of the arbitral tribunal may apply to the High
Court for assistance in taking evidence. In granting such
assistance, the High Court may order the attendance of
a witness to give evidence or, where applicable, produce
documents on oath or affirmation before an officer of the
Lega l He 16 r a ld . NOVEMBER 2015
High Court or any other person, including the arbitral
tribunal. Such an order can be sought against a party or
non-party to the arbitral proceeding. This applies to both
domestic and international arbitrations.
22.214.171.124 Do special provisions exist for arbitrators
appointed pursuant to international treaties (that
is, bilateral or multilateral investment treaties)?
3.4.5 Are there particular qualification requirements
for representatives appearing on behalf of the
parties in your jurisdiction?
There are no particular qualification requirements for
representatives appearing on behalf of parties in Malaysia.
The parties can be represented by foreign lawyers, who
need not be admitted to the local Bar.
However, foreign lawyers may have to obtain a work visa
to appear as counsel for arbitrations held in East Malaysia.
3.5 The award
3.5.1 Are there provisions governing an arbitral
tribunal’s ability to determine the controversy
in the absence of a party who, on appropriate
notice, fails to appear at the arbitral
Should a party without sufficient cause fail to appear at
a hearing or produce documentary evidence, the arbitral
tribunal may continue the proceedings and make the
award on the evidence before it (section 27(c), AA).
There are no express legal provisions in the AA dealing
with late requests for adjournment of a hearing. It would
entirely be a matter for the arbitral tribunal to decide in the
proper exercise of its jurisdiction.
3.5.2 Are there limits on arbitrators’ powers to fashion
appropriate remedies, for example, punitive or
exemplary damages, specific performance,
rectification, injunctions, interest and costs?
There are no limits on the arbitral tribunal’s powers to
fashion appropriate remedies so long as the remedies are
granted in accordance with the substantive law agreed
between the parties and not against a party who is not
a party to the arbitration. However, arbitral tribunals are
generally reluctant to award specific performance or
injunctive reliefs, preferring instead to award monetary
3.5.3 Must an award take a particular form? Are there
any other legal requirements, for example, in
writing, signed, dated, place stipulated, the
need for reasons, method of delivery?
Pursuant to section 33 of the AA, an award shall be made
in writing and signed by the sole arbitrator. Should the
arbitral tribunal consist of more than one arbitrator, the
signature of the majority of all members of the arbitral
tribunal shall be sufficient provided that the reason for any
omitted signature is stated.
The award shall also state its date and seat of the arbitration,
and shall be deemed to have been made at that seat.
A duly signed copy of the award shall be delivered to
each party. It is not uncommon for the award to be
collected from the office of the sole arbitrator or presiding
arbitrator if that is convenient for the parties, or delivered
by courier to the parties’ respective solicitors. The award
is normally not delivered to the parties until full payment
of any outstanding sums payable towards the fees and
expenses of the arbitrator(s) has been remitted. However,
pursuant to section 44(5) of the AA, where an arbitral
tribunal refused to deliver its award before the payment
of its fees and expenses, the High Court may order the
arbitral tribunal to deliver the award on such conditions as
the High Court thinks fit.
Unless the parties have agreed that no reasons are to be
given or the award is an award on agreed terms pursuant
to a settlement, any award given by the arbitral tribunal
shall state the reasons upon which it is based.
Lega l He r a ld . NOVEMBER 2015 17
3.5.4 Can an arbitral tribunal order the unsuccessful
party to pay some or all of the costs of the
dispute? Is an arbitral tribunal bound by any
prior agreement by the parties as to costs?
Pursuant to section 44 of the AA, the arbitral tribunal is
bound by any prior agreement by the parties as to costs.
If there is no agreement by the parties as to costs, the costs
and expenses of an arbitration shall be at the discretion
of the arbitral tribunal. Any party may apply to the High
Court for the costs to be taxed where an arbitral tribunal
fails to specify in its award the amount of such costs and
expenses within 30 days of having been requested to do
so. In the absence of an award or additional award fixing
and allocating the costs and expenses of the arbitration,
each party shall bear its own legal and other expenses,
and an equal share of the fees and expenses of the
arbitral tribunal and any other expenses relating to the
Unless otherwise agreed by the parties, the losing party
will generally bear the costs relating to and incidental to
the arbitration proceedings. In fixing and allocating the
costs and expenses of the arbitration, the arbitral tribunal
may take into consideration any Calderbank offer (“without
prejudice save as to costs”) that was made (section 44(2),
AA). The Calderbank offer shall not be communicated to
the arbitral tribunal until it has made a final determination
of all aspects of the dispute other than the fixing and
allocation of costs and expenses (section 44(3), AA).
3.5.5 What matters are included in the costs of the
The words used in section 44 of the AA are “costs and
expenses of an arbitration”. This would include all costs
and expenses incidental to the arbitration proceedings
that have been incurred by the parties, the arbitral tribunal
and any arbitral institution. Normally, this would include:
• The fees and expenses of the arbitrators.
• The legal costs of the lawyers representing the
• The fees of the expert witnesses.
• The expenses incurred by any arbitral institution.
• The venue rental.
• The transcript service provider’s fees and
• The expenses incurred by the parties in relation
to the factual witnesses and expert witnesses.
In theory, costs may also include the costs of in-house
counsel and management, though in practice such costs
are rarely awarded.
3.5.6 Are there any practical or legal limitations on
the recovery of costs in arbitration?
There is no practical or legal limitation on the recovery of
costs in arbitration. However, if the party against whom
costs are awarded refuses to comply with the award, the
award will have to be registered as a judgment of the
court before it can be enforced.
3.5.7 Are there any rules relating to the payment of
taxes (including VAT) by foreign and domestic
arbitrators? If taxes are payable, can these be
included in the costs of arbitration?
The income earned by a domestic arbitrator is subject to
income tax in Malaysia based on progressive tax rates
(from 0% to 25%). At present, the income earned by a
foreign arbitrator in Malaysia, who is a non-resident in
Malaysia for tax purposes, is subject to income tax at a
flat rate of 25%.
With effect from 1 April 2015, a new Goods and Services
Tax Act 2014 (GST Act) will come into operation, replacing
the existing sales tax and service tax legislation in Malaysia.
This will inevitably have an impact on the fees payable on
the supply of services by foreign and domestic arbitrators.
With this change in law, the supply of services in Malaysia
by a domestic or foreign arbitrator shall be subject to
goods and services tax (GST) at the prescribed rate (6%
as at 2015). However, GST shall only be chargeable on
the supply if the arbitrator is a GST-registered person.
Lega l He 18 r a ld . NOVEMBER 2015
Under the GST Act, the arbitrator (whether domestic
or foreign) is liable to be GST-registered if he earns at
least RM500,000.00 a year from the provision of taxable
services in Malaysia. If the arbitrator is not GST-registered,
he is not at liberty to collect GST.
It should be noted that GST is the liability of the person
making the supply (that is, the arbitrator), unless there
are provisions in the agreement passing the GST liability
to the recipient. Further, where the agreement is silent
on whether the fees payable are exclusive or inclusive of
GST, the general legal position is that the fees shall be
taken to be GST-inclusive.
To avoid any contentious issues, foreign arbitrators
accepting appointments in arbitral proceedings in
Malaysia should agree with the parties that any applicable
GST shall be borne by the parties.
3.6 Arbitration agreements and jurisdiction
3.6.1 Are there form, content or other legal
requirements for an enforceable agreement to
arbitrate? How may they be satisfied? What
additional elements is it advisable to include in
an arbitration agreement?
Section 9 of the AA sets out the definition and form of
an arbitration agreement within the meaning of the
AA. Pursuant to section 9(1) of the AA, an “arbitration
agreement” means an agreement by the parties to
submit to arbitration all or certain disputes which have
arisen or which may arise between them in respect of a
defined legal relationship, whether contractual or not. An
arbitration agreement may be in the form of an arbitration
clause in an agreement or in the form of a separate
agreement (section 9(2), AA). It must be in writing, and is
considered so where it is contained in:
• A document signed by the parties.
• An exchange of letters, telex, facsimile or other
means of communication which provides a
record of the agreement.
• An exchange of statement of claim and defence
in which the existence of an agreement is alleged
by one party and not denied by the other (sections
9(3) and 9(4), AA).
An arbitration agreement can also be incorporated by
reference (section 9(5), AA). A reference in an agreement
to a document containing an arbitration clause shall also
constitute an arbitration agreement, provided that the
agreement is in writing and the reference is such as to
make that clause part of the agreement.
Apart from the above, it is advisable for the arbitration
agreement to expressly state:
• The number of arbitrators that would constitute
the arbitral tribunal.
• The seat and venue of the arbitration.
• The qualification/criteria/experience that is
required of the arbitrators.
• The rules of arbitration pursuant to which the
arbitration is to be conducted should it be an
• The language of the arbitration.
• The law governing the arbitration agreement.
3.6.2 Can an arbitral clause be considered valid even
if the rest of the contract in which it is included
is determined to be invalid?
Pursuant to section 18(2) of the AA, an arbitration clause is
an autonomous agreement, separate from the underlying
contract. Thus the invalidity of the underlying contract
does not ipso facto invalidate the arbitration clause.
3.6.3 Can an arbitral tribunal determine its own
jurisdiction (“competence-competence”)? When
will the national courts deal with the issue of
jurisdiction of an arbitral tribunal? Need an
arbitral tribunal suspend its proceedings if a
party seeks to resolve the issue of jurisdiction
before the national courts?
Lega l He r a ld . NOVEMBER 2015 19
Yes, the arbitral tribunal may determine its own
jurisdiction. The doctrine of competence-competence has
been codified in section 18(1) of the AA, which provides
that the arbitral tribunal may rule on its own jurisdiction.
This is also consistent with Article 16 of Model Law.
Pursuant to section 18(1) of the AA, the arbitral tribunal
may also rule on any objection with respect to the
existence or validity of the arbitration agreement.
There are two types of plea that can be made to the
arbitral tribunal. The first is a plea that the arbitral tribunal
does not have jurisdiction (which shall be raised not later
than the submission of the statement of defence) and the
second is a plea that the arbitral tribunal is exceeding the
scope of its authority (which shall be raised as soon as the
matter alleged to be beyond the scope of its authority is
raised during the arbitral proceedings) (sections 18(3) and
18(5), AA). It should be noted that a party is not precluded
from raising a plea that the arbitral tribunal does not have
jurisdiction by reason of that party having appointed or
participated in the appointment of the arbitrator.
The arbitral tribunal may rule on both pleas either as a
preliminary question or in an award on the merits (section
18(7), AA). Where, in a jurisdictional challenge, the
arbitral tribunal rules as a preliminary question that it does
have jurisdiction, any party may within 30 days appeal to
the High Court to decide the matter. No appeal shall lie
against the decision of the High Court. While an appeal
is pending, the arbitral tribunal may continue the arbitral
proceedings and make an award (sections 18(8), 18(9)
and 18(10), AA).
The courts are unlikely to order a stay of the arbitral
proceedings unless the arbitral tribunal has no jurisdiction.
3.6.4 Is arbitration mandated for certain types of
dispute? Is arbitration prohibited for certain
types of dispute?
Under national laws, arbitration is not mandated for any
particular types of dispute. The fact that any written law
confers jurisdiction in respect of any matter on any court
of law but does not refer to the determination of that
matter by arbitration shall not, by itself, indicate that a
dispute about that matter is not capable of determination
by arbitration (section 4(2), AA). Arbitration is prohibited if
it is contrary to public policy (section 4(1), AA).
3.6.5 What, if any, are the rules which prescribe the
limitation periods for the commencement of
arbitration proceedings and what are such
Section 30 of the Malaysian Limitation Act 1953 expressly
provides that the Limitation Act and any other written
law relating to the limitation of actions shall apply to
arbitrations. In the absence of an agreement between
the parties to refer a dispute to arbitration within a specifi
ed period, the general limitation period contained in the
Limitation Act would apply.
Pursuant to section 6(1)(a) of the Limitation Act, the
limitation period for an action founded on contract or tort
would be six years from the date on which the cause of
action accrued. Unless the parties have agreed to refer a
dispute to arbitration within a specified period, in an action
for contract or tort, the arbitration must be commenced
within six years from the date on which the cause of
action accrued. An arbitration is deemed commenced
when one party to the arbitration serves the other party
a notice requiring the other party to appoint an arbitrator
or to agree to the appointment of an arbitrator, or, where
the submission provides that the reference shall be
to a person named or designated in the submissions,
requiring the party to submit the dispute to the person
so named or designated (section 30(3), Limitation Act).
Some institutional rules may also impose procedural
requirements before a notice of arbitration can be deemed
to have been properly served.
Lega l He 20 r a ld . NOVEMBER 2015
If the parties have agreed to a specified period within
which a dispute should be referred to arbitration, then
such dispute must be referred to arbitration within that
specified period unless extended by the High Court
pursuant to section 45 of the AA. The High Court has
the power to extend the time for commencing arbitration
proceedings if it is of the opinion that, in the circumstances
of the case, undue hardship would otherwise be caused.
As mentioned in Section 2.3.1 above, unless excluded by
the parties, section 45 applies to a domestic arbitration.
Unless agreed to by the parties, section 45 does not
apply to an international arbitration.
3.6.6 Does national law enable an arbitral tribunal to
assume jurisdiction over persons who are not
party to the arbitration agreement?
National law does not allow an arbitral tribunal to assume
jurisdiction over persons who are not party to the
3.7 Applicable law
3.7.1 How is the substantive law governing the
issues in dispute determined?
Section 30 of the AA draws a distinction between domestic
and international arbitrations. Unless otherwise agreed
by the parties, in the case of a domestic arbitration where
the seat of arbitration is in Malaysia, the substantive
law shall be the laws of Malaysia. In the case of an
international arbitration, the substantive law shall be the
law as agreed upon by the parties as applicable to the
substance of the dispute. Failing agreement, the arbitral
tribunal shall apply the applicable law as determined by
conflict of laws rules. Malaysia generally follows the same
conflict of laws principles as applied in other common law
Any designation by the parties of the law of a given state
shall be construed, unless otherwise expressed, as
directly referring to the substantive law of that state and
not to its conflict of laws rules. The arbitral tribunal shall,
in all cases, decide in accordance with the terms of the
agreement, and shall take into account the usages of the
trade applicable to the transaction. It is not uncommon in
most legal systems for trade usages to be used as an aid
to interpretation of contractual terms. The burden of proof
lies on the party who wishes to rely on any particular trade
3.7.2 Are there any mandatory laws (of the seat or
elsewhere) which will apply?
The parties are free to agree on the seat of the arbitration
pursuant to section 22 of the AA. See Section 3.4.2
4. SEEKING INTERIM MEASURES IN
SUPPORT OF ARBITRATION CLAIMS
4.1 Can an arbitral tribunal order interim relief?
If so, in what circumstances? What forms
of interim relief are available and what are
the legal tests for qualifying for such relief?
An arbitral tribunal can order interim relief in relation to
the subject matter of the dispute, and the order may only
be addressed to the parties to the arbitration agreement.
The power to grant interim relief is enshrined in section 19
of the AA. Unless the parties expressly agree otherwise,
the arbitral tribunal has the power to order:
• Security for costs.
• Discovery of documents and interrogatories.
• Giving of evidence by affi davit.
• The preservation, interim custody or sale of
any property which is the subject matter of the
The arbitral tribunal may also require any party to provide
appropriate security in connection with the orders that
Lega l He r a ld . NOVEMBER 2015 21
The arbitral tribunal may also have the power to grant
such other interim reliefs that have been agreed to by the
parties whether in the arbitration agreement, pursuant to
the rules of arbitration that are adopted or otherwise.
Unless agreed by the parties or provided for by the rules
governing the arbitration, the procedures for applying such
interim reliefs are at the discretion of the arbitral tribunal.
In determining whether or not to grant a particular relief
that has been sought for, the arbitral tribunal will apply the
common law tests for such relief.
4.2 Have national courts recognised and/or
limited any power of an arbitral tribunal to
grant interim relief?
See Section 4.1 above.
The arbitral tribunal can grant interim relief after the
constitution of the arbitral tribunal and during the arbitral
proceedings (section 19, AA). On the other hand, the High
Court can order interim measures, pursuant to section
11 of the AA, at any time from the time the arbitration
agreement comes into existence up to the conclusion of
the arbitral proceedings.
As both the High Court and the arbitral tribunal have the
power to grant interim reliefs, an application should first
be made to the arbitral tribunal unless such an order is
necessary to bind third parties or to effectively enforce
the relief in cases where it cannot be done by the order
of the arbitrator. The powers granted to the High Court
pursuant to section 11 are not meant to be oppressively
invoked by a party to arbitration proceedings. They must
be exercised with utmost care and circumspection to
ensure and support the arbitration mechanism and not to
do any act which will stifle the arbitral process. Section
11(2) of the AA provides that where a party applies to the
High Court for an interim measure and the arbitral tribunal
has already ruled on any matter which is relevant to that
application, the High Court shall treat any findings of fact
made in the course of such ruling by the arbitral tribunal
as conclusive for the purposes of the application.
4.3 Will national courts grant interim relief in
support of arbitration proceedings and, if
so, in what circumstances?
Yes, the national courts will grant interim relief in support
of arbitration proceedings, whether or not the seat of
arbitration is in Malaysia. However, in granting the interim
relief, the High Court should be mindful of section 8 of the
AA, which expressly states that “No court shall intervene
in matters governed by this Act, except where so provided
in this Act”. Pursuant to section 11 of the AA, the High
Court has the power to grant the following orders at any
time from the time the arbitration agreement comes into
existence up to the conclusion of the arbitral proceedings:
• Security for costs.
• Discovery of documents and interrogatories.
• Giving of evidence by affidavit.
• Appointment of a receiver.
• Securing the amount in dispute, whether by way
of arrest of property, bail or other security pursuant
to the admiralty jurisdiction of the High Court.
• The preservation, interim custody or sale of
any property which is the subject matter of the
• Ensuring that any award which may be made
in the arbitral proceedings is not rendered
ineffectual by the dissipation of assets by a party.
• An interim injunction or any other interim
See also Section 4.2.
Lega l He 22 r a ld . NOVEMBER 2015
4.4 Are national courts willing to grant interim
relief in support of arbitration proceedings
Yes, see Section 4.3.
5. CHALLENGING ARBITRATION AWARDS
5.1 Can an award be appealed to, challenged in
or set aside by the national courts? If so, on
An arbitral award is final and binding, and the parties
cannot appeal against the award. Where the seat of the
arbitration is Malaysia, the award may be set aside by the
High Court in the circumstances set out in section 37 of
the AA, which is in pari materia to Article 34 of the Model
Law. Article 34(1) of the Model Law, however, has been
omitted from the AA.
Failure of an arbitrator to draw correct inferences is not
sufficient to warrant the setting aside of an award. Further,
the award is also in conflict with the public policy of
Malaysia if the making of the award is induced or affected
by fraud or corruption, or if a breach of the rules of natural
justice occurred during the arbitration proceedings or in
connection with the making of the award.
If section 41 of the AA applies to the arbitral proceedings,
any party may, within 42 days of the publication and
receipt of the award, refer to the High Court any question
of law arising out of the award which substantially affects
the rights of one or more other parties. The High Court
may, on determination of such a reference:
• Confirm the award.
• Vary the award.
• Remit the award in whole or in part, together with
the High Court’s determination on the question of
law, to the arbitral tribunal for reconsideration.
• Set aside the award in whole or in part.
The High Court may also order the arbitral tribunal to state
the reasons for its award should the award not, or not
sufficiently, contain the arbitral tribunal’s reasons. Unless
otherwise agreed, section 41 of the AA does not apply to
an international arbitration held in Malaysia.
5.2 Can the parties exclude rights of appeal or
There is no right to appeal against the award. The position
is not entirely clear, but it appears that the right to set
aside the award cannot be excluded.
5.3 What are the provisions governing
modification, clarification or correction of
an award (if any)?
Pursuant to section 35 of the AA, within 30 days of the
receipt of the award or any other period of time agreed
upon by the parties, a party:
(a) upon notice to the other party, may request the
arbitral tribunal to correct in the award any error
in computation, clerical or typographical error or
other error of similar nature; or
(b) upon notice to and with the agreement of the
other party, may request the arbitral tribunal to
give an interpretation of a specific point or part of
Should the arbitral tribunal consider the request made
to be justified, it shall make the correction or give the
interpretation within 30 days of the receipt of the request
and such interpretation shall form part of the award. The
arbitral tribunal may also correct any error of the type
referred to in point (a) above on its own initiative within 30
days of the date of the award.
Further, a party may, within 30 days of the receipt of the
award and upon notice to the other party, request the
arbitral tribunal to make an additional award as to claims
Lega l He r a ld . NOVEMBER 2015 23
presented in the arbitral proceedings but omitted from the
award. If the arbitral tribunal considers the request to be
justified, it shall make the additional award within 60 days
from the receipt of such request.
For the avoidance of any doubt, the arbitral tribunal may,
where it thinks it necessary, extend the period of time
within which it shall make a correction, interpretation or
an additional award.
See Section 5.1 above.
6.1 Has your jurisdiction ratified the New York
Convention or any other regional conventions
concerning the enforcement of arbitration
awards? Has it made any reservations?
Malaysia acceded to the New York Convention on 5
November 1985, with the following declaration:
“The Government of Malaysia will apply the Convention
on the basis of reciprocity, to the recognition and
enforcement of awards made only in the territory of
another Contracting State. Malaysia further declares that
it will apply the Convention only to differences arising out
of legal relationships, whether contractual or not, which
are considered as commercial under Malaysian law.”
6.2 What are the procedures and standards for
enforcing an award in your jurisdiction?
Awards that are made in respect of an arbitration where
the seat of arbitration is in Malaysia (domestic awards)
and awards that are made in respect of arbitrations where
the seat of arbitration is not Malaysia (non-domestic
awards) are enforceable pursuant to section 38 of the
AA. For the enforcement of non-domestic awards, such
awards must be an award of a state which is a party to the
New York Convention.
In brief, the process of enforcement requires registration
of the award as a judgment of the High Court. The
application for enforcement is made ex parte, and is
typically ordered as of right upon production of the
arbitration agreement and a duly certified copy of the
award (with a translation into English if in a foreign
language). The order for registration of the award must be
served on the respondent, who is given 14 days to apply
to set aside the registration. Enforcement of the award is
stayed pending the determination of the application to set
aside the registration of the award.
Typically, an application for enforcement may be disposed
of within six weeks at the ex parte stage. Legal fees may
be approximately $10,000.00. If the respondent applies
to set aside the award or the registration of the award,
depending on the complexity of the issues raised in
opposing the application:
• Proceedings could take between six months and
a year before it is disposed of in the High Court.
• Legal fees could vary from $20,000.00 to
Recognition or enforcement of an award, irrespective of
the state in which it was made, may be refused only at the
request of the party against whom it is invoked pursuant
to section 39 of the AA. Section 39 of the AA is in pari
materia to the Model Law save for the following that is
stated in section 39(1)(a)(vi) of the AA:
“where that party provides to the High Court proof that the
composition of the arbitral tribunal or the arbitral procedure
was not in accordance with the agreement of the parties,
unless such agreement was in conflict with a provision of
the AA from which the parties cannot derogate, or, failing
such agreement, was not in accordance with the AA.”
Lega l He 24 r a ld . NOVEMBER 2015
6.3 Is there a difference between the rules for
enforcement of “domestic” awards and
those for “non-domestic” awards?
The enforcement procedures for both types of award
are governed by section 38 of the AA and Order 69,
Rule 8 of the Malaysian Rules of Court 2012. There is
no procedural difference. However, only awards that are
from states which are parties to the New York Convention
can be recognised and enforced in Malaysia.
Pursuant to section 39(1)(a)(vii) of the AA, recognition or
enforcement of an award may be refused if the award has
not yet become binding on the parties or has been set
aside or suspended by a court of the country in which,
or under the law of which, that award was made. If an
application for setting aside or suspension of an award
has been made to the High Court on these grounds,
the High Court may, if it considers it proper, adjourn its
decision and may also, on the application of the party
claiming recognition or enforcement of the award, order
the other party to provide appropriate security (section
Pursuant to Order 69, Rule 9 of the Malaysian Rules of
Court 2012, an applicant may enforce a non-domestic
award in the same manner as a domestic award if the
non-domestic award has, under the law in force in the
place where it was made, become enforceable in the
same manner as a judgment given by a court in that
About the authors
Dato’ Nitin Nadkarni (email@example.com) is
a partner, and Darshendev Singh (ds@
lh-ag.com) a senior associate, with the
Construction, Engineering & Arbitration
Practice Group at Lee Hishammuddin
Allen & Gledhill. Nitin is registered on the
panel of arbitrators of the Kuala Lumpur
Regional Centre for Arbitration, the MIArb
and the reserve panel of arbitrators for
the Singapore International Arbitration
Centre. Darshendev, a member of the Bar
Council’s Arbitration Sub-Committee and
Sub-Committee on Construction Law since
2012, is also an associate of the Chartered
Institute of Arbitrators (UK), and the current
Vice Chairman of the Young Members Group,
This material was first published in 2015 by Thomson Reuters in Arbitration World 5th Edition, Sweet & Maxwell
International Series and is reproduced by agreement with the Publishers