Friday, May 30, 2008

English vs. Bahasa in teaching Science & Maths

I wrote this piece in 2002 for Asia Inc magazine. The original title was Avoiding the Babel trap in Malaysia Inc. It is still very relevant, especially when I hear disturbing news that the Ministry of Education is planning to revert from English to Bahasa Malaysia as the language of instruction for Maths and Science. That would be a stupid policy move that will cost Malaysia's economy very dearly in the years to come. Frankly, if Hishamuddin decides on the retrogressive step, he cannot be considered fit to lead the Ministry of Education let alone our beloved country.
It was late afternoon as I sat opposite my friend in his comfortable office in Tower 2 of the Petronas Twin Towers in Kuala Lumpur. I faced the glass window panels behind him and took in the incongruity of the few surviving old colonial bungalows resting in the shade of the tall office buildings that typified Malaysia’s corporate ambition. I listened pensively to his lament about the state of the English language in Malaysia. This 50-year old Malay Muslim CEO of a statutory body should know. “When I started my career in the 1970s, the secretaries still took dictation from their bosses. They were even able to correct the grammatical errors that crop up in dictation”, he said. “Nowadays, I’m better off whacking words into a PC and have the secretary confined to formatting and printing the finished product. I don’t need the stress of correcting letters”, he added.

My CEO friend’s predicament is not unique. Corporate law firms that make a living from putting together strings of words designed to capture the true intent of business partners are also under threat from poor English. “The wit who coined the silly expression ‘Manglish’ cannot have meant ‘Malaysian English’. It should mean ‘mangled English’”, says a senior corporate lawyer. “The worst part of this is that the work load does not decrease with new recruits. It increases because you just can’t rely on drafts from the juniors. More often than not I end up having to draft the whole thing from scratch again”, he moaned.

Increasingly, accounting and law firms create at least two, if not four, levels of vetting of documents. To be fair, this procedure is part of the risk management strategies deployed in the wake of the 1997 economic crisis and, more recently, the pall drawn by the Enron and Worldcom affairs. But poor English has also begat this truncated and annoying procedure. To project a good professional and corporate image with letters, documents and, even websites Manglish is a definite negative.

As Malaysia ups the ante on the logistics front with KLIA pitted against Changi Airport and Chek Lap Kok Airport, and the Tanjong Pelepas Port and West Port against the world-class harbours of Singapore, the real battle may well be on the language front where projects designed to enhance Malaysia’s international competitiveness such as the Multimedia Super Corridor in Kuala Lumpur is being stymied by a supply local knowledge workers weak in English. In contrast, the boon to knowledge workers in the Indian city of Bangalore to augment the Silicon Valley’s global IT reach is largely due to their English proficiency.

The experience of using English in Europe is instructive. Airbus Industrie, an amalgamation of several European countries in civil aviation, had recognized English as a vital medium some thirty years ago when it made English its official corporate language. At its base in Toulouse, south of Anglophobic France, one is struck by the anomalous appearance of a Belgian engineer exchanging technical ideas with a French electrician in English. Meetings at increasingly multi-national and transnational corporations such as Deutsche Bank and Credit Suisse are conducted in English. It is also not unusual to find a largely domestic establishment such as Deutsche Post World Net, the German national post service, using English as its working language. The main reason offered by the Europeans is simple; the United States is the leading global economic powerhouse in commerce, industry and finance. Since Americans use English, so should the Europeans, to maintain competitiveness.

Detractors in Asia usually point to Japan and South Korea as examples of societies that were able to attain economic modernization and corporate competitiveness without sacrificing their vernacular. They also point to the poor economic record of English-speaking countries in Africa that were former British colonies. But, that is simplistic rhetoric. The reality is that Japan began its economic modernization at the turn of the 20th century. They have had a 100-year head start over the rest of Asia. South Korea embraced industrialization in the 1950s with American capital being poured in ideological support for it’s being a frontline state against communism. They have a 50-year head start. In any event, to globalize homegrown brands such as Sony, Panasonic and, more recently, Samsung, the Japanese and South Korean corporations are recruiting graduates proficient in English. Global marketing may require a clear understanding of cultural differences. But amidst this diversity in global markets is the recognition of many countries that English is the dominant business language.

Malaysia rightly fears being put in the ignominous position of having had a strong English-speaking population that has significantly declined. And, with this trend, may go its regional competitive advantage. This concern is the most likely explanation for the recent government policy reversal to convert the teaching medium for the technical subjects of mathematics and science from Malay to English. Another reason may be the recognition that the Malay community is increasingly hamstrung by its restricted proficiency in the Malay language, with Arabic being their second language. In contrast, Chinese and Indian communities are generally multi-lingual. Furthermore, given the insularity of Muslim societies since the beginning of the decline of the Ottoman Empire at the turn of the twentieth century, proficiency in Malay and Arabic may not offer the Malay community the proper paradigm of values to acquire the technical and commercial skills necessary for international economic competitiveness.

Statistically, Malaysia’s superlative economic and international trade record stands proudly above other countries with dominant Muslim populations. But this is irrelevant to Malaysia since it has to compete for international investment within the Asean and East Asian region. “There is no point in being the jaguh kampung [village champion] when we have to compete for foreign direct investment against the likes of Singapore and Thailand, not to mention China”, says an investment analyst in a KL-based broking house.

The issue is not so much that the Malay language or other vernaculars are inadequate. Certainly Japan and South Korea has debunked that myth. The more pertinent concern may be that business cycles have shortened tremendously over the past two decades. The experience of the U.S. automakers in the 1980s illuminates this phenomenon very well. They were jarred awake to the strong competition offered by the Japanese automakers. While their studies revealed that productivity lag and fuel efficiency were important factors, an adjunct to that was the car model changes that the Japanese automakers made. The Japanese were implementing car model changes in two-year cycles when the U.S. norm at the time was four-year cycles.

Such a moral may not be lost on Malaysian policy makers who must have realized that if Malaysia is to offer an efficient manufacturing base for multi-national manufacturing industries English as the medium of communication is necessary. The shorter product life cycles require manufacturing concerns to re-tool and change production lines rapidly. This, in turn, requires retraining of the workforce. It is in this respect that English language proficiency may become a key factor in reducing wastage and turnaround time. In the critical path that manufacturers take to change products, longer training time due to language translation and, the real threat of miscommunication, may make or break finely tuned financial and production plans.

For Malaysia, the re-introduction of English as a teaching medium is not a whim as detractors have sought to portray this policy shift. It is, instead, seen as a key competitive factor in an era of globalization. In the 70s and the 80s, many old colonial buildings in Kuala Lumpur were demolished to make way for the tall corporate spires. In the new millennium, the surviving colonial buildings are being preserved as heritage sites. In a similar vein, the political will that relegated English in a fit of nationalistic hubris has been transformed into the corporate will of Malaysia Inc to restore English proficiency to avert the decline of competitive advantage. Given these realities, opponents of the policy on English instruction in Malaysian schools may, in the colourful words of Franklin Roosevelt, be “somnambulists walking backwards”.

The Malaysian problem with privatisation of public goods

Roads, water, electricity and public transportation are public goods. This means that usage of roads, taxis, trains, LRTs and buses by one individual does not reduce the amount of the good available for consumption by others; and no one can be effectively excluded from using those "goods".
Privatization is the process of transferring ownership of business from the public sector (government) to the private sector (business). Malaysia's first privatisation was Sports Toto in 1985.
Have M'sians benefited from privatisation?
Have Malaysians benefited from privatisation? There's no easy answer for that. But benefit we can see (and experience) is the quantum leap in economic development and business activity over the past 2 decades. The impact of privatising "public goods" can be seen in the increase in the number of kilometres of roads which has opened up many parts of Malaysia. This increased accessibility has engendered more economic activity, particularly property development and domestic tourism.
But, we have also been sceptical about the necessity of privatising other public goods, in the sense that many Malaysians believe that the government agencies and statutory bodies that were responsible for these public goods could have done just as good a job.
For example, in the area of electricity, many of us believe that the old Lembaga Letrik Negara or Tenaga Nasional Berhad ("TNB") could (and, still can) do as good and, as efficient, a job as the Independent Power Producers ("IPP"). Many of us are aghast at the lop-sided Power Purchase Agreements ("PPA") that TNB was forced to sign with the IPPs. We tend to feel that the cost of our electricity has become more expensive due to privatisation.
Or, take the case of the privatisation of water. Many of us feel that the quality of treated water has worsened. Certainly, the privateers have not addressed the urgent matter of leaking water pipes that causes wastages. The cost of that inefficiency is being passed to us consumers.
We also feel perplexed when the same government that has assiduously promoted car ownership also blames us for selfishly causing traffic jams and, worse still the same government cannot provide an efficient public transportation so that we can leave our cars at home (so as not to cause traffic jams)! How many productive man-hours have been lost in traffic jams? Or, for that matter, how many quality leisure hours have been lost? Those are costs to us as individuals and, for the Malaysian economy and society.
Analysing "public choice"
The expression "public choice" is actually a socio-economic tool of analysis. Public choice is often referred to when discussing how individual political decision-making results in policy that conflicts with the overall desires of the general public.
For example, many special interest and pork barrel (pardon the American lingo) projects are not the desire of the overall community. However, it makes sense for politicians to support these projects. It may benefit them psychologically as they feel powerful and important. It can also benefit them financially.
The politicians pays little to no cost to gain these benefits, as they are spending public tax money. Big businessmen are also behaving rationally. They can gain government favors worth millions or billions for relatively small investments.
The taxpayer is also behaving rationally. The cost for an individual taxpayer of defeating any privatisation project is very high, while the benefits to the individual taxpayer are very small. Each citizen pays only a few sen or a few ringgit for using any of these public goods, while the costs of stopping or cancelling such projects would be many times higher.
So, everyone involved has rational incentives to do exactly what they're doing, even though the desire of the general constituency is opposite!
That seemed to be the case for Malaysia until the General Elections of March 8, 2008.
Alternatives to privatisation
As we know, "privatisation" is a 1980s and 1990s expression. Now they call it "private finance initiatives". It doesn't matter how finance people deny it, as far as I can tell, it means the same thing.
Malaysians have always been sceptical about the efficiency of the civil service. But, let us not forget that the revamp of the Immigration Department and National Registration Department was successfully done. No more complaints have been heard. The Road Transport Department is still rubbish, though. But change is possible if there is political will.
Let us also consider the corporatisation of the Securities Commission, the Companies Commission and, even the Inland Revenue Department. We cannot deny that performance has improved.
So, do we really need privatisation? The answer is a qualified NO! The qualification is that certain things must be put in place in order to get rid of privatisation:-
  • Appointment of management and supervisory staff must be strictly on merits, not ethnicity.
  • Salaries and wages must be competitively matched against equivalent positions in the private sector.
  • Accountability and governance must be strictly monitored. Quarterly audits of finances and management processes by public accounting firms must be made mandatory. Their reports must be made public. No different from companies listed on Bursa Malaysia.
  • Regular parliamentary scrutiny must also be made a feature.
That still leaves the matter of how to finance these projects. Let's look at the alternatives to the privatisation financing model:-
a. Government or Sovereign Borrowing
  • Obtain loans from other countries or international funds.
  • Borrowing from private financial institutions or issuing debt instruments like bonds - These transactions create sovereign debts. The only issue is the mode of repayment and, interest and currency risk.
  • Issue Treasury Bonds aka Malaysian Government Securities.
b. Mandatory Taxation
  • Income tax.
  • Sales and value-added tax.
c. "Voluntary Taxation"
  • Lotteries.
  • Public charities and donations.
Let us not forget that the ordinary citizens and taxpayers will still be required to pay to use any of the public goods. This is a source of revenue. It won't be for free, of course.
"Voluntary taxation" via lotteries as a form of public finance has been abandoned since the 1980s. As mentioned earlier, Sports Toto was a statutory body until it was privatised in 1985. It was intended to be a vehicle to raise funds for the development of sports in Malaysia. Sadly, with privatisation the original objectives have disappeared.
Before the repeal of its legislation, the social welfare lottery was a key public finance vehicle for the welfare and services ministry. In its earlier guise, it was a lottery managed by the Malaysian Chinese Association.
What is so fundamentally wrong if this form of voluntary taxation is now deployed as a government policy to fund projects such as:-
  • Roads, highways and bridges (yes, even the 2nd Penang Bridge!).
  • Subsidise public transportation.
  • Education scholarships.
  • Sports development.
  • Tourism-related projects.
  • Micro-financing.
  • Welfare schemes.
The beauty of a voluntary tax is that the "taxpayer" who buys the lottery, sweepstake or 4-Digit number is HAPPY to part with his money. We cannot say the same for the taxpayer who pays his tax assessment.
If we combine the reported annual sales turnover of all the entities involved in lotteries, gaming and wagering in Malaysia, we have about RM12 billion. Assuming RM7 billion is used to pay prize monies and RM2 billion is used for operating expenses (and whatever else), there is still RM3 billion available for public finance. Think about it!
Just let charitable public foundations have the annual licences issued by the Ministry of Finance. Trustees of these public foundations are allowed a tenure of 2 terms of 2 years each. Their accounts, charitable donations and disbursements must be audited quarterly by reputable firms of public accountants. As public foundations, they must be subjected to parliamentary scrutiny.
Lottery operations can be outsourced on 5-year contracts. Tenders and proposals must be public. Tender committees must be outsourced to combined committees of public accounting firms and law firms.
The lurking suspicion one has is that whether it is BN or Pakatan Rakyat that runs the federal government, this form of voluntary taxation will NOT take place. It's a political "hot potato" on irrelevant considerations such as social morality or religious sensitivity. Oh! Let's not forget the powerful lobbying from the businessmen who have a vested interest in these lottery, gaming and wagering ventures. Can Makkal Sakhti happen in the area of public goods management and financing?

Wednesday, May 28, 2008

Things fall apart; the centre cannot hold (or Serigala lawan lembu, kuching menunggu!)

In the aftermath of the Malaysian General Elections of May 8, 2008 major convulsions are taking place within Barisan Nasional component parties, particularly UMNO. Instead of soul-searching and reviews of the electoral debacle, UMNO is fracturing. The cracks and fissures are the product of one man, Dr. Mahathir.
Having ruled UMNO and Malaysia with an iron fist for 22 years Dr. M has quite characteristically acquired a proprietary attitude towards UMNO. Dr. M has been attacking the present UMNO leader, Pak Lah for some time. Naturally, there are many theories being proferred on Dr. M's motivation for attacking Pak Lah and his son-in-law, Khairy Jamaludin.
But, whatever the motivations, Dr. M's inability to accept Pak Lah's leadership of UMNO or Malaysia, is inevitable. Why? Let's take a few examples:-
  • Tunku Abdul Rahman, in retirement, was a fly in the ointment for Tun Razak. His weekly column Viewpoints in The Star during the 1970s was an constant irritant to Tun Razak.

  • Tun Hussein Onn was more discreet than the Tunku. But Tun Hussein's opinion of Dr. M's leadership was well-known to political insiders culminating in Tun Hussein's support of the attempt to register a new UMNO Malaysia after UMNO was deregistered in 1987.

  • Margaret Thatcher, in retirement, was openly critical of her chosen successor, John Major.

  • Let's not forget the tension that existed between Lee Kuan Yew and Goh Chok Tong in Singapore when the latter was Prime Minister.

  • And, the list goes on.

So, from a historical perspective, there is nothing unusual about a former leader feeling that his successor has failed to measure up to his high standards.

Dr. M is a predator. He is on the hunt. The prey is Pak Lah. Dr. M's single-minded focus to bring about the downfall of Pak Lah is very much in character. Just have a look at Dr. M's predatory and iconoclastic past:-

  • In 1969, after he had lost his parliamentary seat he wrote an open letter to demand the resignation of the Tunku. This was in an era when UMNO politics was supposed to be genteel, when UMNO was led by blue-blooded princes such as the Tunku, noblemen such as Tun Razak (who was Orang Kaya Indera Shahbandar of Pekan, Pahang) and Tun Dr. Ismail (whose family was closely linked to the Johor palace).

  • In 1981, when he became Prime Minister he brazenly instituted the Buy British Last campaign and the Look East campaign which put a lot of stress of a traditonally warm relationship between Malaysian and the UK.

  • He also arranged the dawn raid of Guthrie at the London Stock Exchange that stunned the British establishment.

  • He then tried to corner the world tin market using Maminco with disastrous results when the United States released their tin stockpile.

  • In 1987, in an effort to stave off a serious challenge from Tengku Razaleigh, he allowed the old UMNO to be deregistered to enable the creation of UMNO Baru on his own terms.

  • He then caused the dismissal of the Lord President of the Malaysian Judiciary, Tun Salleh Abas and put in place Tun Hamid Omar who emasculated the Judiciary.

  • Let us never forget Operation Lallang where Dr. M jailed 106 Malaysians under the Internal Security Act in 1987.

Clearly, Dr. M does not respect tradition and he certainly has no respect for constitutional institutions. He has held on to an unusual self-belief that he knows what is best for UMNO and Malaysia. Whether it is a psychosis or genius, Dr. M's vulpine ability falls within Max Weber's description of charismatic and legal leadership.

The characteristic of “charisma”, in Weber’s view was stated thus; “There is the authority of [charisma], the absolutely personal devotion and personal confidence in revelation, heroism, or other qualities of individual leadership. This is ‘charismatic’ domination, as exercised by the prophet or – in the field of politics – by the elected war lord, the plebiscitarian ruler, the great demagogue, or the political party leader.”

The characteristic of “legal” leadership was described thus by Weber; “Domination by virtue of ‘legality’ by virtue of the belief in the validity of legal statute and functional ‘competence’ based on rationally created rules. In this case, obedience is expected in discharging statutory obligations. This is the domination as exercised by the modern ‘servant of the state’ and by all those bearers of power who in this respect resemble him.”

The bovine nature of Pak Lah and UMNO

As the vulpine Dr. Mahathir circles the bovine herd that is UMNO, aiming to take a fatal bite at the jugular of the bovine leader, Pak Lah, the herd can only exhibit panic and fear. They are stampeding into each other.

As bystanders and observers, we are watching unfolding events the same way we watch the nature documentaries on the Discovery or National Geographic channels. It is a real spectacle to behold.

If Pak Lah is mindful of the political career of Dr. M, it will be patently obvious that Dr. M does not care if UMNO is torn asunder. After all, the present UMNO is only a 22-year old UMNO Baru. Many political wits have speculated that there can always be another UMNO Baru Baru! So, the destruction of UMNO Baru to bring about the downfall of Pak Lah is not big deal for Dr. M. It is in his character.

Marah nyamuk bakar kelambu and beyond

This Malay idiom is now often used to criticise Dr. M's attacks on Pak Lah. Its English equivalent may be, cutting off your nose to spite your face. But in this fratricidal saga of Dr. M versus Pak Lah the main beneficiary can only be Pakatan Rakyat, particularly Parti KeADILan Rakyat and Anwar Ibrahim.

With each notch that Dr. M removes from Pak Lah's stature as leader of UMNO and BN, the old empire that was UMNO's and BN's is crumbling. Those of us who are familiar with Chinese dynastic history, the history of the Roman empire or the fate of the Soviet Union will see clear parallels.

The cries of discontent from Sabah are reminiscent of the distant provinces that start asserting their autonomy as the center of government is weakened. Wasn't it William Butler Yeats who wrote in his poem, Second Coming, "things fall apart; the centre cannot hold"?

So, picture this - the vulpine Dr. M leaps into the bovine herd that is UMNO, snarling with bared teeth - to bite into the leader of the herd, Pak Lah's jugular - throwing the herd into disarray - the camera pans away from the dusty swirls of the life-and-death struggle - the vista and landscape opens up - we see the verdant green of the lush tropical landscape and the clear azure sky - and, the camera pans and zoom into a rocky outcrop overlooking the terrible struggle in the plains below - behold! it is the outline of the feline guile of Anwar Ibrahim! - waiting to pounce on whomever that survives - and, then, the dust settles - the natural order of things is restored - the cycle of life is renewed!

Maybe a new Malay proverb has been invented, "Serigala lawan lembu, kuching menunggu"!!!!

Tuesday, May 27, 2008

The "culture" of Obedience in Malaysia

Although the results of the Malaysian General Elections in March 8, 2008 shows that Malaysian voters and, perhaps, Malaysian Society has reached a tipping point in tolerating the political dominance of Barisan Nasional, there are deep patterns of obedient behaviour that remain.
I am not saying that we have to be disobedient. I am highlighting one phenomenon of obedience which is INDOLENCE.
Three factors are offered here. Firstly, the Malay adat is still strongly observed. This is manifested is the daily conduct of the Malay to respect their elders and to defer to their greater wisdom. It is submitted that this attitude also manifests itself towards authority figures such as political leaders. This is a feudal attitude that the Malay community still clings to.
Secondly, the Chinese traditions of respect to their elders are rooted in the Confucian tradition. This is coupled with the immigrant ethos, echoes of which are very likely to have been passed on to newer generations, to respect the local authority to avoid causing any trouble. Furthermore, contemporary Chinese Malaysian communities are either politically marginalized or content with the status quo of middle-class indolence and apathy. Is this middle-class apathy starting to disappear?
Thirdly (I stand to be corrected), in orthodox Islam, it has been noted that a citizen has a duty of allegiance to the government. Citizens are, generally, required to be bound “to hear and to obey, in hardship and in ease, in circumstances pleasant and unpleasant” the calls of the government. This is based on the Tradition narrated by the Companion, Ubadah ibn as-Samit, as recorded by Al-Bukhari, as follows:-
“The Prophet called us, and we pledged our allegiance to him. He imposed on us the duty to hear and obey in whatever pleases and displeases us, in hardship as well as in ease, whatever our personal preference, and [impressed on us] that we should not withdraw authority from those who have been entrusted with it, “unless you see and obvious infidelity [kufr] for which you have a clear proof from [the Book of] God”.
It is not a simple thing to oppose an established authority. In any event, it is difficult to establish “obvious infidelity” and obtain “clear proof”. Thus, it is submitted, the tendency is to obey.
I shall let Viscount James Bryce explain it by extracting from his seminal work Studies in History and Jurisprudence (New York: Oxford University Press, 1901)(2 vols). I have placed emphasis in BOLD of passages that deserve particular attention:-

The Grounds of Obedience in General
Political obedience is not a thing by itself, but a form of what may be called Compliance in general.
The grounds or motives of Compliance can be summed up under five heads. Putting them in the order of what seems to be their relative importance, they may be described as the following—Indolence, Deference, Sympathy, Fear, Reason. Let us consider each separately.
By Indolence I mean the disposition of a man to let some one else do for him what it would give him trouble to do for himself. There are of course certain persons to whom exertion, mental as well as physical, is pleasurable, and who delight in the effort of thinking out a problem and making a decision for themselves.
There are also moments in the lives of most of us when under the influence of some temporary excitement we feel equal to a long succession of such efforts. But these are exceptional persons and rare moments. To the vast majority of mankind nothing is more agreeable than to escape the need for mental exertion, or, speaking more precisely, to choose only those forms of exertion which are directly accompanied by conscious pleasure and involve little fatigue.
In a great many exertions of thought resulting in determinations of the will there is no pleasure, or at any rate no conscious pleasure, or at any rate no pleasure which is not outweighed by an accompanying annoyance. Such exertions may relate to things in which we have slight personal interest, and therefore no desires to gratify, or to things in which our personal interest is so doubtful that we shrink from the trouble of ascertaining which way it lies, and are glad to shift the responsibility from ourselves to whoever will undertake it for us.
The ascendency of one of a married couple, for instance, or of one member of a group of persons living together, is usually acquired in some such way. It is not necessarily the will really strongest that in these cases prevails, but the will which is most active, most ready to take a little trouble, to exert itself on trivial occasions and undertake small responsibilities.
Persons of a resolute and tenacious character are sometimes also hesitating and undecided, because they cannot be at the trouble of setting to work, for the little questions of daily life, their whole machinery of deliberation and volition. In five persons out of six the instinct to say Yes is stronger than the instinct to say No—were it not so, there would be fewer marriages—and this is specially so when the person who claims consent possesses exceptional force and self-confidence.
In other words, most of us hate trouble and like to choose the line of least resistance. In tropical Africa the country is covered by a network of narrow footpaths, made by the natives. These paths seldom run straight, and their flexuosities witness to small obstacles, here a stone and there a shrub, which the feet of those who first marked them avoided. To-day one may perceive no obstacle. The prairie which the path crosses may be smooth and open, yet every traveller follows the windings, because it is less trouble to keep one’s feet in the path already marked than it is to take a more direct route for one’s self. The latter process requires thought and attention; the former does not.
Nor is the compliance of indolence less evident in thought than in action. To most people, nothing is more troublesome than the effort of thinking. They are pleased to be saved the effort. They willingly accept what is given them because they have nothing to do further than to receive it. They take opinions presented to them, and assume rules or institutions which they are told to admire to be right and necessary, because it is easier to do this than to form an independent judgement. The man who delivers opinions to others may be inferior to us in physical strength, or in age, or in knowledge, or in rank. We may think ourselves quite as wise as he is. But he is clear and positive, we are lazy or wavering; and therefore we follow him.

Monday, May 26, 2008

The Strange Story of MIC's Role in incorporating Fundamental Liberties into the Federal Constitution

I present an extract of the transcript of the hearing by the Reid Commission of submissions by the Alliance wherein Tunku Abdul Rahman was questioned by Lord Reid regarding the Alliance memorandum on fundamental rights.
In reply, the Tunku admitted that it was the Malayan Indian Congress (not UMNO or MCA) who insisted on the fundamental rights provisions. The wisdom of the Indian community in Malaya was, no doubt, derived from the Indian constitutional experience.
This is an interesting and strange piece of constitutional history that shows starkly how remarkable events take place in seemingly mundane settings. Our Fundamental Liberties - such as freedom of speech, equality, rights to education, property and religion - are contained in Part II of the Federal Constitution. Read the following transcript that reveals the pivotal role played by MIC's early leaders, especially K.L. Devasaer (, in insisting on inserting Fundamental Liberties provisions into the Federal Constitution:-
Fundamental Rights
Chairman (Lord Reid): There are two kinds of Fundamental Rights - those that are enforceable by the Court, as set out in page 10, and those which are extremely varied and cannot be enforceable by the Court, but merely guides (sic) the future political parties as to what they should do. Now, you put in here quite a lot of the second class of Fundamental Rights which you really cannot guarantee. I am wondering whether you want them to be put in such great detail or not at all?
What do they do? They simply tie your hands and your successors? So far as they have any political effect; they have no legal right and, speaking entirely for myself, it seems to me to deflect the argument whether that is a good Bill or a bad Bill, it is a question of words whether it fits in with Article C of the Fundamental Rights in the Constitution which has become a matter of words, because every political party that ever was would say that they are trying to promote a sound social order and the welfare of the people.
Whether it is democratic, totalitarian, right wing or left wing, they all say they are doing right. I wonder whether that gets you anywhere.
Tunku Abdul Rahman: All these can be taken out. The main thing is the Fundamental Rights. It was a suggestion from the MIC, and that is why it was put in.
Mr.Ramanathan: Whatever is not constitutionally enforceable, they could probably be taken out. Whatever rights should be protected by the Courts would appear in the Constitution.
Chairman: Anything for the Court should be made sufficiently definitive for the Court to enforce. As regards Freedom From Fear, I very much fear that no Court or Government could do that.
Dato Abdul Razak: That is true. We have given an Appendix.
Sir Ivor Jennings: All those listed on page 10, or do you really mean the list that is worked out in the Appendix?
Tunku Abdul Rahman: It was really put in at the suggestion of the Indian community as represented by the MIC. As far as UMNO and MCA are concerned, it is immaterial whether it is in or not - if we have to mention other rights, then there are a million rights.
And, there you have it! The real heroes of the Malayan community that insisted on the Fundamental Liberties provision in the Federal Constitution were the MIC leaders of the time. The extract can found at: Stockwell, AJ [Editor]; Malaya : Part III : The Alliance Route to Independence 1953-1957; HMSO [London] [1995]; at pp. 317-318; Paper 427 [CO 889/6, ff 281-290].
2 things stood out in the above transcript:-
  1. The Reid Commission was, as Professor Andrew Harding has noted, very legalistic. The eventual Federal Constitution is a very legalistic document, as opposed to aspirational. The Indian Constitution, for example, has aspirations contained in their State Directive Principles which is a guide for Courts. The Indonesian Constitution is aspirational.
  2. The Indian community in Malaya had been exposed to the Constituent Assembly debates that led to Indian independence in 1947. As a community they were the most aware of the importance of enshrining Fundamental Liberties in the Constitution.


The present-day MIC is, of course, a completely different entity. But since its roots can be traced to the halcyon days when Merdeka was an unfolding possibility, present-day MIC members should be proud of and, be guided by the high ideals exhibited by early leaders such as K.L Devaser.
A good description of the ethos and mindfulness of the framers of the Indian Constitution with regard to fundamental rights can be obtained from Saharay, HK; The Constitution of India : An Analytical Approach; Eastern Law House; [Reprint-1998] [Calcutta]; at pp. 32-33.

Alan Smith, wherefore art thou?

A poor haiku in the aftermath of Leeds 0, Doncaster Rovers 1:-





leave Newcastle

Leeds is home

Come back

prodigal son

More sorrow!
The Leeds gaffer's stoic feelings are better and, certainly more upbeat than my haiku:-
Leeds United boss Gary McAllister conceded that his side were below par as they crashed out of the League One playoff final with a dismal 1-0 defeat at the hands of Doncaster Rovers. James Hayter was the man that fired Rovers into the Championship, with their goalkeeper, former Leeds United stopper Neil Sullivan rarely tested and McAllister moved quickly to accept that his side had been second best.
Speaking to he said:“We huffed and puffed but lost a poor goal at a set-piece. We've defended set-pieces better than that in the past. “Doncaster played well, we knew they'd come and pass the ball. We huffed and puffed but our quality wasn't there today. “We didn't make Sully make a save today. There were a few near bets where we got in the box but our final ball in wasn't good enough.”He finished with the most important bit for Leeds fans:“The players will come back next season ready for it, with the stomach for it.”

Sunday, May 25, 2008

Leeds United

It was during their 1974/75 season in the English 1st Division that I became a supporter of Leeds United. It was my classmate Hock Chai (a really good midfielder and occasional center-forward in school) that got me hooked on Leeds. I haven't caught up with Hock Chai for many years. When I do, I will ask him if he's still a Leeds fan. I still am, despite their recent travails.
Not that I'm in a philosophical mood, but can being a supporter or fan of a sports club or a sports hero be telling on a person's character? I haven't given the matter much thought. I tend to think that supporting Leeds gives me a primal need to be part of a tribe (in the Elias Canetti-sense of tribal behaviour). But I haven't really examined the psychology of fan-behaviour.
Can we learn anything from being fans and supporters (especially hardcore supporters) and, apply it to political affiliations? Or, use it to gain insight into why people quit from political parties that they have been such an integral part of? Or, to explain motives for leaders hopping from one political party to another? I'm just playing around. Firstly, I don't think we can derive any lessons from sports fan behaviour and apply it to politics. Secondly, I have no intention of adding to the boisterous voices and thoughts expressed about the merits, ethics and morality of quitting political parties, shifting alliances, hopping from one political party to another, crossing the parliamentary aisle ... matters which have so dominated Malaysia's media and blogosphere in recent weeks. I don't believe I can contribute to that obssession for the reason that a fast-developing political situation demands what newshounds call a "scoop". The only scoop I do is to scoop the pile of poo that my pets release around my house (though I suspect that many newshounds may feel as I do - when scooping dog poo - as they "sniff" around for scoops in Malaysia's political scene!). So I'll leave it at that.
Anyway, Leeds United in the 74/75 season was managed by Don Revie. Revie is revered by Leeds fans for the manner in which he completely reorganised the club and its players. The story is legendary and well-told by Leeds fans and historians in sites like and, in particular, I cannot do better than that. But I do visit those sites often just to re-live the days when, as a young teenager (in an era when "live telecast" was reserved only for major events such as the World Cup Finals, FA Cup Finals and European Cup Finals) I stayed up for the European Cup Final of the 1974/75 season where Leeds played Bayern Munich in foggy conditions and .... lost 0-1 amidst controversial refereeing decisions and bad fan behaviour.
The long and short of it is that Leeds United played this 2007/08 season down in, what is called League One. This is the old 3rd Division. Not only that. After suffering the ignominy of relegation from the Premier League and languishing for 2 seasons in the Championship League (old 2nd Division), last season (2006/07) Leeds was relegated to League One and, went into receivership (for which the English FA penalised it with a 15-point deduction).
Tonight, Leeds plays Doncaster Rovers at Wembley Stadium in a play-off for promotion from League One to the Championship League. I know, what an underwhelming feeling and oh! so far from the madding crowd and rarefied heights of Top 4 Premier League clubs this is. But despite being in the "gutter" of English football, us Leeds fans can take some measure of comfort for staying the course and, being true to the cause that Leeds is, despite adversity, ridicule and (worst of all) wry sympathies from itinerant Arsenal "supporters".
I like Gary McAllister, who is the current manager. Liverpool fans will remember Gary for his scintillating contribution to Liverpool's cup campaigns 2 seasons ago. But, Leeds fans remember him for his spell in Leeds during the 1990s when Leeds won the last League Championship of the old 1st Division in the 1992/93 season (after that the Premier League was formed). His spirit and commitment has brought into the Leeds dressing room a team spirit and zeal that should give them an edge over Doncaster Rovers tonight. Gary was preceded by Dennis Wise (ex-Captain of Chelsea) who really brought a great spirit from the "siege mentality" that he instituted amongst the young Leeds team of today.
Unlike the itinerant fans of clubs like Manchester United, Liverpool, Arsenal or Selangor (!!!, I was a hardcore fan in the 1970s when Soh Chin Aun, R. Arumugam, Wong Choon Wah, Mokhtar Dahari and Santokh Singh played), this is the sad life of a Leeds fan. You learn to dig deep into your character and soul (yes! just ask hardcore fans) to seek meaning to sustain your loyalty. That's where History gives all that you are a meaning and, a context, to explain your emotional attachment to a cause that appears to be a "lost cause". The situation may appear to be bleak, the situation may have been bleak some for time now, but, we will draw great spirit and comfort during the long, cold winter of discontent if we have a sense of History.
Maybe the political hacks can learn from being football fans after all!

Thursday, May 22, 2008

Sarawak Land Reform - The Historical Context

In his seminal book Malaysian Politics (2nd Edition 1976), Gordon P. Means wrote on the saga of Stephen Kalong Ningkan's attempt to institute land reform in Sarawak:-
During 1965 a political crisis developed within the Sarawak Alliance over land reform proposed by the Chief Minister, Stephen Kalong Ningkan of SNAP. While the legislation had been under consideration for almost three years the decision to implement the proposals came as a surprise to those who hoped they would be forgotten. The basic question was whether the system of native land rights should be amended to allow greater land use by the immigrant communities. Under previous laws the Chinese could only own land in very limited areas designated as "Mixed Zones", while Malays and natives own land in "Native Areas". In addition, the interior tribal natives had customary rights over "Native Customary Land". Chief Minister Ningkan's land reform bills would have changed these laws by giving the interior natives right to acquire full title to "Native Customary Land", including the right to sell their land to whomever they wished. Consequently, the proposed reforms were advantageous to interior tribal natives who would gain title to large tracts of potentially valuable jungle land (emphasis added).
Means went on to describe the following:-
When Ningkan got wind of the efforts being made by BARJASA Secretary-General Inche Taib Mahmud to undermine his government from within, he dismissed Inche Taib from the Sarawak Cabinet. This action precipitated a crisis between the pro-Ningkan forces and the pro-Kuala Lumpur forces. From the point of view of the Federal Government, the test of strength came prematurely, for only BARJASA and Pesaka joined the revolt, while Ningkan retained the support of his own party (SNAP) along with PANAS and the SCA. The next day an entourage of BARJASA and Pesaka officials flew to Kuala Lumpur, and later produced a letter which expressed "no confidence" in Ningkan. On the basis of this letter, signed by 21 members of the Council Negri, Tunku Abdul Rahman demanded that Ningkan resign. Ningkan refused to do so since the opposition parties had no desire to bring down his government on this issue (i.e. the issue of land reform in Sarawak), and thus with their votes he was confident of gaining 21 of the 42 votes in the Council Negri, plus the Speaker's casting vote. Consequently, BARJASA and Pesaka boycotted the Council Negri sessions, preferring instead to invite direct federal intervention.
The rest, as they say, is history. Ningkan was sacked and the attempt at land reform was buried.
The key document that we should re-visit is the Report of the Land Committee, 1962 (Kuching, Sarawak; Government Printer, 1963) published by the Government of Sarawak.

Wednesday, May 21, 2008

The Road Not Taken

Written in 1916 by the late American poet laureate, Robert Frost, this poem has resonance. Certainly in light of the events in the early months of 2008, many of verses will be found to be very apt and resonant.
The Road Not Taken
Two roads diverged in a yellow wood,
And sorry I could not travel both
And be the one traveler, long I stood
And looked down one as far as I could
To where it bent in the undergrowth;
Then took the other, just as fair,

And having perhaps the better claim,

Because it was grassy and wanted wear;

Though for that, the passing there

Had worn them really about the same,

And both that morning equally lay
In leaves no step had trodden black.
Oh, I kept the first for another day!
Yet knowing how leads on to way,
I doubted if I should ever come back.
I shall be telling this with a sigh

Somewhere ages and ages hence:

Two roads diverged in a wood, and I-

I took the one less traveled by,

And that has made all the difference.

Sunday, May 18, 2008

Sarawak: Ningkan & Native Lands

The death knell sounded for Stephen Kalong Ningkan without his knowing when he mooted the idea of granting titles for native lands in 1963. Unlike the stalwarts of SUPP, Ong Kee Hui and Stephen Yong, who had opposed the formation of the Federation of Malaysia, Ningkan had formed SNAP and embraced the Sarawak Alliance with the support and blessing of Tunku Abdul Rahman. It was a decision that Ningkan would live to rue as the tumultous constitutional events that led to his sacking, would prove.
Skullduggery started almost immediately with Ningkan's radical native land title proposal. There were certain well-placed political leaders in the Sarawak Alliance who saw the idea of granting titles to native lands as anathema. Such a situation would create a wealthy class of natives, particularly Ibans, who would then form the core political power in Sarawak. No, that could not be permitted.
A land title, even if it is native land title, is valuable. It means that anyone who wants to use the land, say, for logging, or mining, or hydro-electric dams, would have to negotiate with the native landowners. There would have to be detailed negotiations for compensation, re-alienation, change of land use, and so on. Many steps would be required. In other words, the native landowner would become a key factor in any developmental matters for any native-owned part of Sarawak that was targetted for development. And, more importantly, the native landowner would be entitled to receive fair and adequate compensation.
That inconvenience was completely avoided mainly by neutralising the political power and influence of Stephen Kalong Ningkan. It was a sad chapter of Malaysia's constitutional history. And, it happened so early in the life of the Malaysian federation. Furthermore, it was done via the declaration of the first emergency in independent Malaysia. And this insidious move was led by Tunku Abdul Rahman, no less!
No doubt, the ouster of Ningkan started with a rebellion in the ranks of the State Assembly. But history will prove that Ningkan's leadership of the Ibans and other natives and, most importantly, his plan for the enfranchisement of the Sarawak natives by the creation of native land titles, was a major threat to many quarters.
Let us imagine that Ningkan was successful in establishing a native title system. All native communities in Sarawak would have been given indefeasible title over their land. It would have meant that any party, even the government - whether Federal or State - would have had to negotiate any development plans with the native communities. Native communities would have been able to have a clear voice supported by the law, to impose conditions and obtained fair compensation if they disposed off any part of their land.
Without any titular and registrable rights in the present Native Customary Land ("NCR") system, the Sarawak native communities have suffered the ignominy of waking up in the morning to the monstrous sound of tractor engines and chainsaws. Their queries to the loggers and contractors are rebuffed with shoulder-shrugs. The natives would be given the go-around to many parties, always based in distant towns. By the time the natives get organised, time would have elapsed and the authorities that made the fateful administrative decisions would be protected by statutory time-bars.
The present NCR approach to land use in Sarawak is a sham. It is a device that favours the state and well-connected businessmen. The natives who only demand to have the right to live their way of life are completely helpless. Worse still, they have no idea why their world is being destroyed right before their eyes. Trees planted by their ancestors, rocks that have a sacred spirit, rivers from which they fished - things that define who they are - are all gone in a matter of hours, days, weeks and months (no need for years). They have no voice, no say, in the development of their part of Sarawak.
This disenfranchisement is caused by the absence of land rights. The people of Sarawak must, in good conscience, wake up to the plight of their native brethren, many of whom are languishing in poverty.
Stephen Kalong Ningkan's political fate was sealed decades ago by controversial means. The leadership of the natives of Sarawak has never been permitted to congeal and be embodied by any one leader. Perhaps it is time to articulate the rights of the natives of Sarawak through a new forum and leadership such as that offered by PKR.

Saturday, May 17, 2008

Agricultural Investment Schemes

The Malaysian Companies Act offers an interesting alternative for plantation owners to gain access to investment funds. This is an alternative to conventional funding methods such as bank loans or being publicly-listed. This avenue should be of particular interest to plantations that are starting-up or undergoing a major replanting programme.
The first-ever Agricultural Investment Scheme ("AIS") approved by the Companies Commission of Malaysia ("CCM") is the Country Heights Growers Scheme ("CHGS") promoted by Tan Sri Lee Kim Yew, the creator of the upmarket gated communities of Country Heights in Kajang and Damansara and, the Mines Resort City.
After extensive research into AIS programmes in Australia, Canada, Scotland and several other countries, I was able to conceptualise and present a concept paper on behalf of CHGS for CCM's consideration and approval.
CHGS established 40,000 investment units known as Growers Plots. The scheme was launched in March, 2007 and to-date, the takeup rate has been so phenomenal that more than 80% of available Growers Plots have been subscribed for.
With the success of the pioneering CHGS, plantation owners are now able to consider AIS as a fundraising option.
AIS gives plantation owners direct access to a ready pool of investors who are interested in a direct investment in the oil palm sector. An investor may invest in shares of a listed plantation company, which offer returns in the form of dividends and, gains (or losses) in the movement of share prices. The risks and returns are obvious to all. AIS, however, offers a steadier, yet attractive, rate of return which should appeal to risk-averse investors.
AIS is similar to a closed-end fixed yield instrument. This is one of the key features of CHGS. The annual yield payable to the investor is a range of percentages between 6% to 12% of the initial investment sum which is linked to the annual average price of crude palm oil ("CPO") published by the Malaysian Palm Oil Board ("MPOB").
The yield computation formula is designed to achieve 2 things:-
  • It is easy for the investor to monitor his/her expected returns for the year.
  • It is an objective formula i.e. not dependent on the operational efficiency of the plantation.

The added sweetener is that there is a bonus feature in that additional yields will be paid to the investor based on the actual tonnage of fresh fruit bunches ("FFB") harvested by the plantation.


AIS is an agricultural investment model that has arrived in Malaysia. It is worthy of consideration by plantation owners seeking access to investment funds for starting-up plantations or replanting programmes. To have a better idea of the AIS-model have a look at CHGS at

Thursday, May 15, 2008

de minimis non curat lex

One cold morning in my 3rd year at the David Derham Law School at Monash University, Melbourne (that would be Australia and the year was 1984), Mr. Kumar Amarasekara walked into Lecture Hall L1 to deliver a lecture on a Criminal Law module on sexual offences. As he took us through the intricacies of sexual offences on vital issues such as whether the usage of a tongue on the private parts of an unwilling person constitutes a sexual offence he paused and, with a dead-pan face, offered this limerick to make a point about how the law will not deal with trivialities. Kumar said thus,
There was a young man named Rex,
Who had diminutive organs of sex.
When caught for exposure,
He said with composure,
De minimis non curat lex!
(the law will not deal with trivialities)
As you may have guessed, I never forgot the limerick.

Good times for federalism in Malaysia

What do we mean when we say that Malaysia is a federation? It means that 13 states got together to form a nation. The Malaysian nation is bound by a written contract. We call it the Federal Constitution.
One of the important features of the Constitution is that most of the revenue collection powers is given to the federal government. The federal government, then, allocates the revenue collected to federal government ministries and agencies and, to the states. There is a formula for distributing funds to the states. One measure is the state's population. Another is the length of roads in the state. Apart from these constitutional formulas, any other funds or grants by the federal government to the states are purely discretionary.
This discretion has been the problem ever since Merdeka in 1957 (which affects 9 states in Peninsular Malaysia) and remained after 1963 when Sabah, Sarawak and Singapore joined the Federation (Singapore left in 1965, of course).
It is quite obvious that because so much wealth is collected and kept at the federal level, state governments have been forced to be subservient. This federal wealth has also been used effectively to maintain political control over state governments.
That was the state of play from 1957. But, since the 12th General Elections of March 8, 2008 the situation has taken an interesting turn. There are now 5 state governments that are controlled by non-Barisan Nasional parties (I refuse to call them "Opposition States") aka Pakatan Rakyat ("PR") states, namely, Penang, Kedah, Perak, Selangor and, of course, Kelantan.
The PR states have begun to challenge the Federal-State relationship. The nature of the challenge is broad, ranging from funding of infrasructural projects e.g. 2nd Bridge Penang, to toll roads.
But, the even more interesting development for federalism is the restiveness of the Members of Parliament from Sabah. The Sabah MPs are from BN component parties. While there may be indications of political gamesmanship by Sabah MPs, it will be perilous (not to mention naive) for the powers-that-be in UMNO (the main beneficiary of BN) to ignore the restiveness.
Sabah is an extremely resource-rich state. It has an abundance of fertile land for oil palm plantations, plenty of offshore oil and gas, timber, wonderful beaches, diving sites, mountains ... an endless list. Yet, there is much poverty and serious underdevelopment.
Yes, one can blame the Tun Mustapha era. Yes, mud can be thrown at the Harris Salleh administration. No doubt, the Pairin era did not engender positive changes. Yes, rotating CMs for several years caused much indecision. All these are Sabah's own state governments. But any visitor to Sabah who bothers to really mingle with the ordinary Sabahan will become very quickly aware that the wariness of "orang Malaya" (that's what they call West Malaysians) is very real. So, it is not that Sabahans love the state BN but, that they hate KL more! (to paraphrase Shakespeare).
Whatever the motivations, the "rebellion" from Sabah MPs has generated issues of federalism particularly the concentration of wealth at the federal level. Unlike the 5 PR states who need federal largesse, states like Sabah are merely asking to be allowed to have a larger share of oil royalties from oil extracted from their offshore oil and gas deposits. Now, that is a powerful argument.
More importantly, the impact of these trends on the constitutional issue of federalism will be very significant, indeed. One interesting question is, why are the Sarawakians so quiet this time around? Let us recall the Malay proverb, air tenang jangan disangka tiada buaya.

Removing some shackles

I have decided to change the "look and feel" of the blog. The earlier version was too confining. A check of the rules and regulations of the Malaysian Bar was disheartening. If the blog was maintained as a law firm blog, I had to comply with too many "do's and don'ts". For example, I will not be able to describe my involvement as a lawyer with any projects or work that I had done to-date. I will also not be able to add any links that may give rise to any negative views of the legal profession. I certainly will be prohibited from adding any interesting links. Let me just extract one such rule:-

Rule 7. Information or material which is not permitted

Without limiting the other provisions of these Rules and any other applicable laws, the following material or information is not permitted on Websites: (a) material or information which is indecent, obscene, false, offensive, defamatory or seditious under the laws of Malaysia; or (b) publicity which is presented or published in a manner which is contrary to the laws (relating to publicity of Advocates & Solicitors) of Malaysia; or (c) publicity which is presented or published in a manner which, in the opinion of the Bar Council, is likely to diminish the confidence of the public as regards the legal profession of Malaysia or to otherwise bring the legal profession of Malaysia into disrepute; or (d) publicity which infringes Publicity Rule 5 in any way; or (e) any advertisement or publicity which relates to parties other than the Advocate & Solicitor or his firm.
See what I mean?
So, I decided to unshackle myself. I haven't needed any advertising to sustain me. This blog is just a form of expession. My earlier 2 entries below (I realise) are cutting-edge cures for insomnia! The information, I assure you, is very sound. But the delivery was straitjacketed and dull, out of necessity and compliance. But now that this blog is Taoist Dreams and, not CT Choo Law, let's have some fun!

Wednesday, May 14, 2008

Carriage of Goods by Sea

For a country with a significant sea-faring tradition and a substantial number of merchant fleets, Malaysia's maritime laws can appear to be anachronistic. The Malaysian Carriage of Goods by Sea Act ("MCOGSA") and Merchant Shipping Ordinance have hardly been reviewed since their respective enactments many decades ago. Moreover, by virtue of the Malaysian Civil Law Act, the English Bill of Lading Act (which dates back to the 19th century!) applies to Malaysia even though the United Kingdom has abandoned that statute in 1992.
Some pertinent issues involving international trade and, specifically, carriage of goods by sea, include:-

Bills of Lading ("B/L")

B/Ls are issued by the carrier/shipowner. They are usually signed by ship’s master.

B/Ls have 3 principal characteristics:-
  • Evidence of receipt of goods by carrier
  • Contract of carriage: s.4 MCOGSA
  • Prima facie document of title to goods (this is a defeasible title only because the buyer still has the right to reject goods under the Malaysian Sale of Goods Act ("SOGA").

A “Clean” B/L means goods received in perfect condition. A “Claused” B/L means goods may have defects as specified.

Bills of Lading Act (UK)

Repealed in UK (by the Carriage of Goods Act 1992 ("UKCOGSA") but still valid for Peninsular Malaysia under s.5(1) Civil Law Act. The Bill of Lading Act may not be applicable to the states of Sabah and Sarawak due to the operation of s.5(2) Civil Law Act.

The Bill of Lading Act is disadvantageous to the position of the buyer for the following reasons:-

  • The buyer has no privity of contract with carrier
  • The buyer only assumes risk to goods. This enables the buyer can insure the goods but the buyer has no contractual standing to sue carrier. There is no privity of contract since the privity is between the vendor and the carrier.
  • The buyer can only sue after receiving the B/L. This is disdvantageous in FOB delivery situation.

If the transport document is not a B/L e.g. a document called a Mate’s Receipt, the buyer cannot rely on the Bill of Lading Act for protection.

Comparison between the Hague, Hague-Visby & Hamburg Rules

Before 1924, the Common Law regime imposed ABSOLUTE liability for carriers, making carriers liable for the vessels' seaworthiness throughout the voyage. Unfortunately, during the deliberations to establish the Hague Rules, the merchant marine used their superior bargaining power to lobby for provisions that enabled carriers to contract out of common law liability. This was a set-back for international trade. This weakness was reflected in the Hague Rules (1924).

The Hague Rules were modified by amendments that became known as the Hague-Visby Rules which increased carrier's liability.

The most recent revamp was the Hamburg Rules that increased carriers' liabilities even further.

Please note the following:-

- MCOGSA adopts Hague Rules.
- UKCOGSA adopts Hague-Visby Rules.
- Singapore & Australia has adopted Hamburg Rules.

Contracting out of liability of carriers – Hague (may be possible to contract out), Hague-Visby & Hamburg does not allow. Hollandia Denning LJ said carriers cannot contract out of liability under H-V Rules.

  • Duration of liability – Hague & Hague-Visby (only at time of commencement of voyage), Hamburg (throughout voyage – returns to common law position).
  • Liability for deviation from route – Hague & Hague-Visby (no liability), Hamburg (liability).
  • Liability of cargo-owner to inform about dangerous goods – Hague & Hague-Visby (no liability), Hamburg (cargo-owner liable for non-disclosure).
  • Limitation period – Hague (1 year), Hague-Visby (1 year but can be extended by mutual agreement – must be clear, Hamburg (2 years).
  • Liability of cargo-owner for freight & demurrage – Hague & Hague-Visby (cargo-owner liable even if B/L silent on this), Hamburg (cargo-owner not liable if B/L silent).
  • Application to documents other than Bills of Lading – Hague (does not apply to non-bills of lading), Hague-Visby (can apply to any non-negotiable receipt but document must expressly say that H-V Rules apply), Hamburg (applies to any transport document for carriage of goods by sea).
  • Particulars of goods in B/L – Hague (minimum requirements), Hague-Visby (more details than Hague), Hamburg (most number of particulars).

Malaysia’s reliance on the Hague Rules may be because it wants to protect the local merchant fleet. But if Malaysia aspires to be a modern maritime nation it must review the MCOGSA to adopt, at least, the Hague-Visby Rules. This will make Malaysian merchant fleet more attractive to foreign shippers/cargo-owners.

Since the Hamburg Rules protects the shippers/cargo-owners most countries with merchant fleet that adopt the Hamburg Rules may be the most attractive to shippers.

Dear Visitor,
You are welcome to contact me, CT Choo at my email if you have any questions regarding the information above or, any related matters. I will try to answer your queries.
CT Choo

Gaming & Wagering Laws in Malaysia

Gaming and wagering is a strictly regulated activity in Malaysia. The Malaysian Contracts Act reflects this position by providing that all gaming and wagering contracts are void.

However, gaming and wagering is permitted by licensing or exemption. There is a plethora of statutes that regulate gaming and wagering activities in Malaysia:-

  • Pool Betting Act
  • Betting Act
  • Lotteries Act
  • Common Gaming Houses Act
  • Racing (Totalisator Board) Act
  • Racing Clubs (Public Sweepstakes) Act

Specialised gaming and wagering revenue collection statutes are:-

  • Gaming Tax Act
  • Betting and Sweepstakes Duties Act
  • (Pool betting duty collection is provided in the Pool Betting Act)
  • (Lottery duty collection is provided in the Lotteries Act)

Repealed statutes on gaming and wagering include:-

  • Social Welfare Lotteries Act
  • Gaming Ordinance of Sabah (Cap.50)
  • Gambling Ordinance of Sarawak (Cap.138)

Corporations or clubs in Malaysia that are licensed to conduct forms of gaming and wagering include the following:-

  • Tanjong plc (its subsidiary Pan Malaysian Pools Sdn Bhd)
  • Pan Malaysian Sweeps Sdn Bhd
  • Selangor Turf Club
  • Perak Turf Club
  • Penang Turf Club
  • Sports Toto Malaysia Bhd
  • Magnum 4D Bhd
  • Sandakan Turf Club
  • Everise Ventures Sdn Bhd
  • Royal Sabah Turf Club
  • Keningau Turf Club
  • Sarawak Turf Club
  • Natural Avenue Sdn Bhd
  • Lotteries Corporation (88) Sdn Bhd

Apart from licensing and regulatory matters and corporate matters, substantive management and operational matters that are relevant include:-

  • Game branding
  • Game design
  • Prize payout structure
  • Retail outlet design
  • Rules & regulations of games
  • On-line computer vendor identification & negotiations
  • Gaming software contract negotiations
  • Training modules for staff
  • Result-drawing machine vendor identification
  • Drawing procedures

Dear Visitor,

You are welcome to contact me, CT Choo at my email if you have any questions regarding the information above or, any related matters. I will try to answer your queries.

CT Choo