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1) Unequal Treatments Felt by the Non-Bumiputeras Due to the Implementation of New Economic
Development

The issues concerning the New Economic Policy (NEP) of Malaysia is that even though the policy
has ended nearly 20 years to-date, the issues of unequal treatments felt by the non-Bumiputeras. According
to Shahriza Ilyana Ramli, Nur Zafifa Kamarunzaman, Irlisuhayu Mohd Ramli from Faculty of Administrative
Science and Policy Studies and Faculty of Business Management, University Teknologi Mara, Shah Alam,
policy enforced mainly support the economy and the social development of the Bumiputeras. However,
many found themselves been discriminated systematically especially those non-Bumiputeras. Two
objectives have been introduced under NEP, to reduce and eventually eradicate poverty; and the second
is to accelerate the process of restructuring Malaysian society so as to eliminate the identification of race
with economic function. The debate about its implementation and its effectiveness had risen out many
voices since the objectives highlighted were not only having a significant impact on economic issues but
also on political aspects. As to date, the views on the policy are mixed up with different viewpoint based on
what is perceived. Some viewed the policy as exclusiveness or more favourable to a single race which was
Bumiputeras; thus the policy postulated as injustice to other races. On the other hand, the majority of
Bumiputeras holds it positively as the policy secured their long-lasting survival in economic and gradually
improves their standard of living. Other than that, the NEP objectives are said have yet to be fully achieved
to date although it was mended to consolidate all races in Malaysia. The critiques pertaining NEP extended
to all aspect of economic planning; from scholarship granted to employment, from agriculture sector to
industrial enterprises, from contracts and licensing to foreign investment, so on and so forth. The policy has
become the most controversial issues where by the government has been said as practicing economic
discrimination towards non-Bumis (Jesudason, 1990).

According to Khairiah Salwa Mokhtar, Chan Ai Reen and Paramjit Singh Jamir Singh (2012) from
Universiti Sains Malaysia, after the 1957 independence, the country is affected with a disproportionate
pattern of wealth distribution in which the Chinese held a big part of the wealth compared to the other two
main ethnic groups in the country. Poverty was largely prevalent among them since the Malays occupied
the rural area and the Indians in the estates whereas the Chinese were concentrated in urban locations of
the country. This situation reflected the differences in the incidence of poverty by race particularly in
Peninsular Malaysia. The household monthly income in 1970 in Peninsular Malaysia ranged as low as
RM276 for the Malays, followed by RM478 for the Indians, RM632 for the Chinese and RM1304 for other
groups. According to Roslan (2003), Thorbecke and Charumilind (2002), the unequal distribution of wealth
among different ethnic groups in Malaysia created ethnic tensions in the society. This ethnic tension burst
out as a racial riot in 1969 killing hundreds of people. It was only after the 1969 riot, the New Economic
Policy (NEP) was developed and implemented by the government in 1970 as the principal policy response
to the riots. The NEP was considered as an affirmative action policies due to its main aim of benefitting and
protecting the Bumiputra (the Malays and the indigenous people) who comprises the majority of the
population. By granting the immigrants citizenship and safeguarding their legitimate interests, the
government has made it clear that the special privileges for the Bumiputra as the native people of Malaysia
would be preserved and will not be questioned at any time. In fact, this matter was specifically mentioned
in the Article 153 of the Constitution of Malaysia which grants the Yang di-Pertuan Agong (King of Malaysia)
responsibility for safeguarding the special position of the Bumiputra and the legitimate interests of other
communities. Basically, the NEP plays a vital role in the history of both economy and politics of Malaysia.
During the period of NEP, Malaysia had substantially reduced its poverty level and led to the growth of
Malay middle and business classes. The introduction of NEP firmed up the hierarchy for different time
periods, the political reality being set by the New Economic Policy 1971-90 (NEP), the National
Development Policy 1991-2000 (NDP), and currently the National Vision Policy 2001-1020 (NVP). Each of
these documents sets out for its respective time period an explicit ‘vision’ for social and economic change
which had been missing (or thought define ‘development’ in Malaysia’s terms and set agenda for socio-
economic change.

Despites of being said as the most controversy policy ever, at one point, we could say that, this
policy has become the foundation of and the important yardstick for all economic and social policy as
projected at least until year 1990. Although it has ended for a quite period of time, and other policies planned
and executed, the impact of NEP is felt until today. The strongest argument for NEP is the policy had helped

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to bring about the political stability and national unity in the country. Paradoxically, not only Malaysia is
having dilemma for policy grievances of discrimination against certain parties, there are similar problems
also faced by other countries, to name a few such as America, Thailand, Indonesia and Singapore. Although
this policy is seen as one kind of affirmative policy, however it does not practice the ‘real’ discrimination to
the races other than Malay. In order to overcome the issues of unequal treatments felt by the non-
Bumiputeras however, the main solution would be to educate in great details to the public on the positive
impacts made through the NEP in developing our nation’s economy. Other than that, the government should
implement supported development opportunities with the non-Bumiputra.

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2) The Needs to Implement Single Title System under National Land Code 1965

According to Department of the Director General of Lands and Mines (Federal) through their
Consultation Paper entitled Review of the National Land Code 1965 in 2012, there are several issues under
the National Land Code 1965, one of it being that the current institutional framework and legislation creates
a hindrance of implementing an electronic land administration system. The existing of decentralized register
databases does not facilitate in the area of efficient monitoring and sharing of information. There will always
be a lack in real time information and the need of replicating information has to be done which creates the
need for larger servers and data spaces. This increases the cost and also the need for extra security
aspects to be implemented for the success and the conclusiveness of the data. Having a dual titling system
under the policy reduces the efficiency in doing business. People want an easy and simple way to do their
dealings. It can be a bother, when a person wants to deal with the respective Land Office. This indicates
that the land administration has to provide various type services for titles issued in that particular state at
the any nearest land office

The National Land Code 1965 provides for issuance of two types of land titles, namely Registry
Title (i.e. GRANT, STATE LEASE, Q.T.(R)) and Land Office Title (i.e. MUKIM GRANT, MUKIM LEASE,
Q.T. (M)). The land administration system at present is administered at two strategic levels, District Land
Offices (to have control over administration of land office titles registers); and creation of Registry Title
Office—that is the State Director of Lands and Mines Office (to have control over administration of registry
titles registers. Subsection 292(2) of the National Land Code 1965 requires the lodgement of instrument of
dealing relating to land held under land office title to be presented at the respective Land Office where the
Register document of title is kept, whilst the instrument of dealing relating to land held under registry title
shall be presented at the respective Registry Title Office of the State. Whereas Section 375 of the National
Land Code 1965 requires the Land Registry (that is District Land Offices or the State Director of Lands and
Mines Office) to ensure the continuous safe keeping of land registers which fall under their respective
jurisdiction. This leads to the creation of numerous land Registers database at State level and cannot be
located in one centralized database in the State Director of Lands and Mines Office as the law requires it
to be distributed or decentralized and maintained at the District where the title was issued and registered.

The main issue is caused by the present system of issuing two types of title, Land Office (Mukim)
and Registry, which is burdensome. In view of promoting an efficient service delivery and an electronic land
administration system, it is proposed that a centralized database is created at the State Director of Lands
and Mines Office which consolidates and maintains both the Mukim and Registry Registers of Titles. The
proposed concept will see all Land Office Titles converted to Registry Titles and this will provide the platform
for a single title system which will make doing business in the land administration much easier and fast.
This concept will not only be a precursor for legislative amendments but it will be an impetus for transforming
the fundamentals of the land administration institutional structure towards a global change to enhance
service delivery. From this proposed reformation, there would be several affected provisions. Firstly, in
order to meet the objectives of creation of a single land title system, Part Ten of Division III of the National
Land Code1965 is proposed to be reviewed by inserting after Chapter 4 a new provision, section 175G to
prescribe clearly the method of creating the single title system. Sample of the proposed provision:
―Chapter 5 – Conversion of Land Office Titles Into Registry Titles Coming into force of the conversion of
Land Office Title into Registry Title 175G. (1) For the purpose of section 5A or section 5D of this Act, as the
case may be, the State Authority may, by notification in the Gazette, make conversion of any Land Office
Title in any office of the Land Administrator to be held under Registry Title as he may consider necessary
for the purpose of Electronic Land Administration System. (2)Upon the coming into operation of the
conversion in subsection (1), the State Authority may, by notification in the Gazette, in accordance with
section 12 of the Code, appoint for the State– (a) a State Director of Lands and Mines as a Registrar of
Titles; (b) all Land Administrators as Deputy Registrars of Titles; (c) all Land Offices as branch offices of
the Registry Title office. (3)In the circumstance of subsection (2), any reference to ―Land Office Title‖ or
―Land Administrator‖ appeared in this Act shall be read as Registry Title or Deputy Registrar of Titles
respectively. (4)Any conditions or restrictions or memorials or endorsements or encumbrances for the time
being in force to the Land Office Title shall, but subject to any direction in contrary by the State Authority or
by operation of law, continue to have effect in the converted register document of title pursuant to subsection
(3). Review of National Land Code 1965 (Consultation Paper) Page 16; (5)Provisions in this Chapter shall

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apply, mutatis mutandis, to any strata title of document in Form 4 in the First Schedule of the Strata Titles
Act 1985 in which it‘s corresponding to the Land Office Title thereof. (6)Nothing in this Chapter shall have
the effect of conversion of any Land Office Title into Registry Title– Provided that there shall be an online
registration system in force pursuant to section 5A in respect of Computerized Land Registration System
or pursuant to section 5D in respect of Electronic Land Administration System in any land Registry.” The
creation of a single land title system will help to ease the management system, which is to be used in the
electronic land administration system.

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3) The Needs to Establish a Land Court

Land administration is an interplay of various aspects, that is land use, development, conservation
and preservation, and the tension between economic development and protection of natural and other
resources as such requires inter disciplinary expertise to achieve balance decision (Department of the
Director General of Lands and Mines (Federal) 2012). In Malaysia, there are various legislation regulating
land use, land tenure, administration, land development, land acquisition and environmental regulation such
as the National Land Code 1965 (Act 56), Strata Titles Act 1985 (Act 315), Town and Country Planning Act
1976 (Act 172), Street, Drainage and Building Act 1974 (Act 133), Local Government Act 1976 (Act 171),
Public Authorities Protection Act 1948 (Act 198) and Environmental Quality Act 1976 (Act 127) that provides
for establishment of Appeal Board pursuant to section 35 and section 36 to deal with appeal. The appeal
can be from any person aggrieved by: (a) a refusal to grant a licence or transfer of a licence; (b) the
imposition of any condition, limitation or restriction on his licences; (c) the revocation, suspension or
variation of his licences; (d) the amount which he would be required to pay under section 47; (e) any
decision of the Director General under subsection (3) or (4) of section 34; and Review of National Land
Code 1965 (Consultation Paper) Page 24; (f) any decision of the Director General or any officer under
subsection (2) or (5) of section 48A. Having many competing jurisdiction to adjudicate for land matters
makes service delivery rather slow and creates redundancy.

Land administration is interplay of various aspects such as land use, development, conservation
and preservation. The tension between economic development and protection of natural resources requires
inter disciplinary expertise to achieve a balance decision. In Malaysia various legislation regulates these
aspects such as National Land Code 1965, Strata Titles Act 1985 (Act 315), Town and Country Planning
Act 1976 (Act 172), Street, Drainage and Building Act 1974 (Act 133), Local Government Act 1976 (Act
171), Public Authorities Protection Act 1948 (Act 198) and Environmental Quality Act 1976 (Act 127). These
legislations provide an avenue to make an appeal through its own establishment or by virtue of court.

It is essential to consider the establishment of a specialised Land Court. The system if implemented
should be made more transparent and with enhancement of avenues for public participation. Rules should
be developed properly so that the discretion is not exercised in an arbitrary manner, because land use
planning is crucial to the delivery of sustainable development due to its ability to manage growth and
change, link national and local goals, examine issues in the round, and encourage public participation.The
various dispute resolution tribunals established in Malaysia to resolve land use and environmental disputes
discussed above have to a certain extent been proved useful especially the Homebuyers and Consumer
Tribunals. It would be beneficial to examine the establishment of a specialized land court to resolve disputes
arising from land administration and related aspects. The underlying assumption is that all government
powers whether the sovereign powers of legislatures or the delegated powers of officials are held on behalf
of the community and therefore they are accountable for their actions. The affected provisions include
insertion of new Part 30A into the National Land Code1965 to provide for establishment and administration
of a Land Court. By establishing this new Part, managing disputes in the land administration and
development would be more systematic and arranged.

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4) The Needs to Enhance the Capacity Building and Professionalism of Land Administration Services

According to Department of the Director General of Lands and Mines (Federal) through their
Consultation Paper entitled Review of the National Land Code 1965 in 2012, there have been numbers of
critics and comments on slow moving of changes in land administration service delivery. Even though there
have been numbers of efforts has been taken to improve service delivery, but the changes done were
believed to unable to satisfy the high expectation and perception of general public. Meanwhile the land
administration remained in a poor interaction in delivering their routine job service and suffering with the
remark for not having an excellent factors in serving the public. According to Seah Choon Chye in his article
entitled ―A National Land Code?”, in 2006, Seah Choon Chye has challenged the land administration with
the following provocation: ― “if the authorities concerned continue to drag their feet and refrain from
implementing appropriate measures to clean up the mess at the land registries and land offices, irreparable
damage will be done to the Torrens System under the Code and the objective of ensuring uniformity of law
in the registration of dealings and other land matters under the Code can never be fulfilled, thereby
confirming the views of many conveyancing practitioners that there is in actual fact no national (or rational)
land code governing the administration of land in Peninsular Malaysia, notwithstanding the declarations
expressed in the preamble to the Code.” The issue that has been highlighted here is the fact that the land
issue is of growing interest in our country, including the aspect of land administration. The ICT providers
are increasingly interested to invest in loans and grants for the establishment of appropriate land
administration systems. Capacity building (in a broad sense, including institutional building) is a major
prerequisite for successful establishment of people-friendly land administration systems, and there is a
growing demand. Also the influence of business developments and IT opportunities urge land
administrations to change substantially. However at present the number of personnel who are called
‘specialist’ with experience, knowledge, vigour and skills are getting scarce. The real land administration
experts are few in number. The present land administration in Peninsular Malaysia is facing the scarcity of
expert resources. It requires not only more expert capacity to teach, to conduct research and to deliver
efficient services, but also more capable leadership in delivering an excellent factor service delivery of the
land administration. Compared to other land administration in the countries of the Torrens jurisdiction, the
position of Malaysian land administration system is far behind from the global standard especially in terms
of integration of data for delivering efficient land administration services to the nation. The Malaysian land
administration system is strategically handled at two levels of government, Federal and State; and therefore
it requires effective coordination between the two levels of government so as to promote an effective and
efficient land administration services throughout the country. Thus, there is also a need for building the
organizational capacity in response to the global drivers of change in land administration.

Land administration is an interdisciplinary field comprised of four interlinking tracks: economics,

law, land administration and surveying (geodesy and geoinformatics). On the basis of the demand from the
community, land administration is required to offer for simple and people-centric services. Generally, the
capability of Land Administrators and staffs are expected to deliver the following outcomes: (a) Capable of
understanding and solving land administration related problems. (b) Equipped with professional capabilities
in land administration and willing to actively participate in community affairs (such as population,
environment and gender) (c) Able to advice the federal and state legislature on legislation and economic
policies relating to land. (d) Able to resolve land-related disputes based on the relevant legislation of the
country. (e) In a position to involve land-related reform tasks, land development activities and rendering
rights-based solutions to the country development needs. (f) Able to develop and conduct research and
provide continuous learning in the field of land administration. (g) Able to serve their community by
developing and offering various relevant skills such as land administration, surveying, economics and law.
(h) Capable of working cooperatively for the common good of society. A modern Land Administration
System is concerned with providing detailed information at the individual land parcel level. It should service
the needs of both the individual and the community at large. Benefits arise through its application in
guaranteeing of ownership, security of tenure and credit; facilitating efficient land transfers and land
markets; supporting management of assets; and providing basic information in processes of physical
planning, land development and environmental control. The system, this way, acts as a backbone for
society. Modern Land Administration Systems should facilitate sustainable development, social and
environmental sustainability - through public participation. The land administration functions are based on
and are facilitated by appropriate land information infrastructures that include cadastral and topographic

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 TPS 515⃓ STRUCTURE OF GOVERNMENT

datasets and provide access to complete and up-to-date information of the built and natural environment.
These ambitious goals will not be achieved unless there is a commitment to designing and implementing
effective land administration infrastructures. These may be described as the organizations, standards,
processes, information and dissemination systems and technologies required to support the allocation,
transfer, dealing and use of land (UN-FIG, 1999). Information and communications technology (ICT) will
play an increasingly important role both in constructing the necessary infrastructure and in providing
effective citizen access to information. There must be absolute commitment from all stakeholders to
maintain and upgrade the land administration infrastructure, the highest level of capacity building that
capable in sustaining the efficiency co-ordination of land administration system, either at the Federal level
or State level. Hence, capacity building is defined as ―the development of knowledge, skills and attitudes
in individuals and groups of people relevant in the design, development and maintenance of institutional
and operational infrastructures and processes that are locally meaningful‖ (Groot and Moolen, 2001). It is
pertinent to address that an important aspect that must not be neglected in creating a world class land
administration service is capacity building of the personnel involved in all levels of land administration.
Towards achieving this, the Review of the National Land Code in 2010 has recommended that there must
be a Specialized Centre for Accreditation and Professionalism Development of Land Administrators to
assume its position as the sole institution for developing human capital in the discipline of land
administration. Collaboration by smart partnership with local and international institutions of higher learning
will assist in improving the capacity building that will help in creation of land administration entity as a
professional discipline and leads to production of adequate numbers of professionals or accredited
consultants in land administration continuously. The basis of this idea is not entirely new but then it had
been promulgated in the Report of Land Administration Commissioners 1958 prior to operation of the
National Land Code 1965 in Peninsular Malaysia.

A combination of the recommendations included in the Report has envisaged the reality of
Malaysian land administration discipline; Recommendation No. 111. ―Sound land administration is
intricate work requiring experience, knowledge, vigour and skill. It can truly be called a ‘specialist’ service,
and ideally the staff would consist of officers qualified in the varied aspects of land administration. Because
of this, we gave careful consideration to the question of establishing separate Lands Departments in each
of the States, and providing a lands service career for officers in such departments. We are agreed that
this is entirely correct in principle.” Recommendation No. 115. ―Land experience and administration
inculcates a wide outlook and should lead to more general efficiency. Training in a Land Office should,
therefore, be regarded as a qualification for subsequent promotion to other Officers and other Departments.
Now, it seems to be regarded as a disadvantage. A Land Office clerk, however, after becoming proficient
should not be transferred too soon and should remain in a Land Office for a minimum period of about 5
years.” Recommendation No. 118. ―It is essential that the personal efficiency of everybody working in a
District Land Office be maintained at the highest possible level, and this should be kept in mind constantly
by Officers supervising and inspecting Land Offices.” Recommendation No. 135. ―Any tendency to
discriminate against the needs of land administration must be abandoned once and for all. Land
administration must have a high priority otherwise all efforts to progress will be frustrated. The fact should
be accepted that land administration is one of the most important functions in Malaya, and that its activities
come second to those of no other department.”

It is at the right time for the capacity building of land administration be reformed and transformed
by legal force to accommodate the needs of the government delivery system, society‘s advancements and
global commercial needs. This proposal requires changes to be made to the roles of the Department of
Director General of Lands and Mines (Federal) as a lead agency in promoting a sustainable coordination
of land administration between Federal and States level. The proposed amendments are requires changes
to legal framework of the National Land Code 1965 as suggested: Amendment of Section 8; Subsection 8
(1) of the National Land Code 1965 is proposed to be amended by inserting after paragraph (e) the following
paragraphs— (f) with the concurrence of the State Directors, conduct periodical review of the legal
framework and suggest amendments to the legislation and procedures to be adopted in the land Registry;
(g) with the concurrence of the State Directors, reengineer the procedures involved in land administration
to promote a continuous enhancement of delivery of services; (h) with the concurrence of the State Director,
provide accreditation services to land administrators, support for capacity building and create a sustainable
pool of experts in land administration; (j) advice the Federal Government on aspects relating to formulation

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of land policies taking into consideration any issues relating to land administration prevalent during the
particular period.” Insertion of new section 8A: The National Land Code 1965provisions is proposed to be
inserted after section 8 the following new section— “Establishment of Land Administrators Board, regulation
of accreditation procedures, etc. 8A: (1)There shall be a Land Administrators Board established in the
Department of Director General of Lands and Mines (Federal) for the purpose of providing accreditation
services to land administration in the States of Peninsular Malaysia; (2) The Minister may, after consultation
with the National Land Council, by order notified in the Gazette of the Federation, prescribe— (a) the
requirements and procedures to be adopted in providing professional accreditation development services
by the Department of Director General of Lands and Mines (Federal); (b) the fees, costs and other sums to
be charged for any accreditation services commissioned to private land administration practitioners;
(c) the conditions upon which, and the authorities by whom, any such fees, costs or other sums may be
varied or remitted, either in whole or in part.” Affected provisions include Section 8 of the National Land
Code 1965 and insertion of new section 8A.

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5) Conflict between Land and Planning Legislation Over Land Use and Development Control

The National Land Code and the Town and Country Planning Act 1976 (Act 171) govern and define
the parameters of the land use and development control systems of Peninsular Malaysia. Leong, Hoon
Wah, in “Ideology and Conflict in the Systems of Control of Use and Development of Land in Malaysia and
Scotland” asserts that the two separate sets of legislation on land use and development control
administered by separate bodies have given rise to conflict between the authorities administering them.
Conflicts that arise from the two systems of control, have also weakened the utility of land and planning
legislation as a means of land use control. This is because it can lead to the occurrence of breaches of
condition and underutilization of land. One notable example of the occurrence of conflict between these
two legislations is the case of Yow Chuan Plaza in Kuala Lumpur taken from the journal made by Ibrahim,
Kamilia, Land Use and Development Control in the Federal Territory of Kuala Lumpur, (1984), Master of
Law dissertation, University of Malaya. In this case an approval for a development plan was made in
contravention of the zoning plan for that area. The land in question was zoned as a residential area under
the Planning Act but the approval given by the land office under section 130 of the National Land Code was
for commercial use. Another instance in which a landowner can be drawn into an area of possible conflict
with planning law concerns his right to apply to the appropriate land office under the National Land Code
for conversion of the existing land use to another land use which may be contrary to the development plan.
This is because the National Land Code does not require that the Land Office must take planning law into
consideration when an application for approval of a conversion is submitted.

Malaysia has more than 125 land legislation other than the National Land Code. It is a federation
of 13 states and three federal territories: that is the former Malay states of Selangor, Perak, Pahang, Negeri
Sembilan, Kedah, Perlis, Johor, Kelantan and Terengganu, the former Straits Settlements states of Malacca
and Penang, situated in Peninsular Malaysia and the two Borneo states of Sabah and Sarawak forming
East Malaysia and the federal territories of Kuala Lumpur, Labuan and Putrajaya. Apart from the three
federal territories that are administered by the federal government, the other states are governed by theie
respective state government. Peninsular Malaysia, formerly referred to as the Federation of Malaya,
attained political independence from Britain on 31st August 1957, and was absorbed into the greater
Federation of Malaysia on 16th September 1963. On the formation of Malaysia, Singapore and the British
Protectorates of Sarawak and Sabah on the Borneo Island became constituent parts of the new Federation.
In 1965, however, Singapore left the Federation of Malaysia, leaving the eleven states of Peninsular or
West Malaysia and the two Borneo states forming East Malaysia. Some 400 miles of the South China Sea
separate West and East Malaysia. As to land, historically and constitutionally it has always been under the
jurisdiction of state governments. All land situated within the respective state boundaries are vested in the
state and they therefore have the power to dispose and deal with it. Both the legislative and executive
functions pertaining to land matters are vested in the states and the supreme authority in each state on
questions of land administration is the “Ruler” defined under Article 160 of the Federal Constitution as “in
relation to Negeri Sembilan, means the Yang di Pertuan Besar acting on behalf of himself and the Ruling
Chiefs in accordance with the Constitution of that State; and in the case of any State, includes…any person
who in accordance with the Constitution of that State exercises the functions of the Ruler:” Moreover,
revenue from land taxation accounts for a major part of the state's annual income. ‘Land’ under the Federal
Constitution The Constitution seems to adopt an artificial definition of land when it separates land in its
physical form from its components or resources such as tin ores, petroleum, forestry and agriculture. Even
though the Constitution has separated land from its components, the components are all placed under the
same list that is the State List. But, the state government shares its jurisdiction with regard to town and
country planning and environmental related matters that are also assigned to the federal government. The
definition of land given by section 5 of the National Land Code 1965 is wider in scope
and in line with the common law definition as compared to that adopted by the Constitution. It refers to land
not only in its physical form but include its components. As a result of the artificial demarcation made by
the Constitution, the land law in Malaysia does not encompassed matters relating to town and planning,
environment, mining, forestry and agriculture. The word “land” in the paper encompass not only land in its
physical form but will also include its components such as environment, mining, and town planning.

The federal Parliament in many circumstances has the power to legislate beyond the confines of
the specific legislative list. This overriding legislative power has enabled Parliament to make laws with

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respect to land matters for the purpose of ensuring uniformity of law and policy in all the eleven states in
Peninsular Malaysia. But this federal government’s power conferred by Article 76 cannot be extended to
Sabah and Sarawak. Nevertheless under a federal set-up, which allows federal intervention, the centre
can encroach without much difficulty. At present, the federal Parliament's power to make law on the basis
of "uniformity of law and policy" does not extend to any land matters but only covers "land tenure, the
relationship of landlord and tenant, transfer of land, mortgages, leases and charges in respect of land,
easements and other rights and interests in land, compulsory acquisition of land, rating and valuation of
land and local government" under the Article 76(4). However, it is observed that Parliament's power to
legislate on the "uniformity basis" exclude Malay reservations, permits and licenses for mining, mining
leases and certificates as well as escheat and treasure trove6 Thus, federal Parliament may, on the ground
of uniformity, intervene in land matters and as a result, major land legislation, the National Land Code (NLC)
was enacted and brought into force on 1st January 1966 for all the states of Peninsular Malaysia. Other
legislations enacted under this provision are the Land Acquisition Act 19608 and the Land (Group
Settlement Areas) Act 19609. The NLC was enacted with the objective of introducing a uniform land system
with respect to land tenure, registration of titles and land transactions (preamble to the National Land Code).
This legislation replaced forty-three different types of legislation relating to both federal and state, and has
significantly affected the land tenure system, land policies and land development in the country. These
changes were initiated with the object of achieving national development objectives as set out under the
various Malaysian development plans. Besides the NLC, there are about 12513 other laws in Peninsular
Malaysia relating to land. A number of separate federal and state land laws continue to exist and are not
affected by the Code. These laws concern Malay Reservations, Mining Enactments, National Forestry Act
1984, Customary Tenure Enactments, Sultanate lands, laws relating to Wakaf (land bequeathed for
religious purposes) or baitul-mal (General Endowment Fund), the Kelantan and Terengganu Land
Settlement legislation, the Land (Group Settlement Areas) Act, Land Development Act, Town and Country
Planning Act, Environmental Quality Act, the Land Acquisition Act, the Small Estates (Distribution) Act, Padi
Cultivators (Control of Rent and Security of Tenure) Act and other related land laws.

Federal intervention in this area does not only occur legislatively but also via federal administrative
bodies such as the National Land Council, the office of the Director General of Land and the Regional
Development Authority. In addition to directing and controlling the utilisation of land the National Land
Council has a duty to advise either the federal and state governments in respect of utilisation of land or any
proposed legislation dealing with land or the administration of any such law. But, since the federal
government has no executive functions and merely acts in an advisory capacity, it has no authority to
enforce its directions. Nevertheless, pursuant to its national development plan and the New Economic
Policy, the federal government has increasingly used its strong financial position to intervene in land
development projects through the Federal Land Development Authority (FELDA), the Federal Land
Consolidation and Rehabilitation Authority (FELCRA) and the various Regional Development Authorities.
Hence, because of the federal government’s centralising tendency and also the drive towards uniformity
referred to above, the states have undoubtedly been guarding and retaining this remaining and important
function with a considerable degree of caution. This sometime has incontestably brought the federal
government into conflict with the state governments over land matters, for instance, it took the National
Land Council over 20 years to have a uniform legislation on mining – the State Mining Enactment, to replace
the varied state Mining Enactment but has yet to be fully adopted by all the state. It was initially rejected
by the state governments which viewed the proposal as an infringement by the federal government over
state rights on land matters.

Solution to this issue would be to develop a land tribunal. This goes by many different names, such
as Land Title Tribunals, Cadastral Commissions or Land Courts, but their objective is the same: to deal
explicitly and exclusively with land-related conflicts. Some of them would be dealing with all kinds of land
conflicts, while others concentrate on one major type of land conflict, such as illegally allocated state land.
Both models are possible and make sense. Non-specialised land courts help to the federal intervention
from the burden of land-related cases, decrease the time of party that have to invest in solving land disputes
and improve decision-making by arbitrators who are more familiar with land issues. Special courts or
tribunals focusing on a specific type of land conflict are generally put in place when there is an unusual
accumulation of this type of land conflict, e.g. in post-conflict situations or in cases of a previously systematic
illegal allocation of state land. The specific land tribunals should be temporary ones, existing for as long as

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there is a need to settle these specific types of land conflicts. The general land courts could be permanent
structures. Both must be constituted by the state. Their decisions should be binding and final. Appeal to the
High Court should only be a last resort. The High Court should only be allowed to verify the correctness of
the procedure of the land tribunal but not to re-open a case. To avoid irregular procedures right from the
beginning, civil society should be involved in the monitoring of the land tribunals, e.g. in a joint commission
together with state officials.

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6) Conflict in Land Development Initiatives by FELDA

Until the end of 1995, some 536,694 hectares of agricultural areas had been developed nationwide
under schemes. Altogether, there are 309 land schemes accommodating over 100,000 families. This
federal government land development machinery managed to stem modern settlers who contributed
significantly to the plantation sector of the economy. These effective methods of land reform have become
the model for other under-developed countries to emulate. Currently, this FELDA land that constitute the
nation's largest land bank, has become a focal point for development. This is because the scarcity of land
in the prime zones eventually forces the development to spill over to the surrounding areas. These
developments encircle some of the FELDA scheme and pressure inevitably builds up to bring the FELDA
land forward to meet the need for commercial and industrial development. Thus, after 41 years of its
implementation, many state governments have decided to redevelop FELDA land for commercial and
industrial purposes and this defeats the original land development reform initiated by the federal
government.

The Federal Land and Development Authority (FELDA) was established 46 years ago under the
Land Development Act, 1956. It served as one of the federal government's tools to help eradicate poverty
and restructure the community. The main role of FELDA was to open up and manage the new agricultural
land schemes. The settlers were selected among the hardcore poor in the rural areas who had no other
lands to work on. Under the schemes, each settler family is given 8-10 acres of land; two acres for planting
fruit trees and one quarter of an acre for constructing a house. At the end of the repayment of the
consolidated annual charge, which includes the premium on land, development costs, survey fees etc.,
each settler will be issued with a land title. This normally takes about 15 years.

Some approaches to this issue would be to eliminate the commercial activity from the area or
moving it somewhere else, evaluation or compensation. Through the elimination of the commercial activity
or moving it somewhere else, thorough but quick analysis need to be made in order to avoid a second
spillover of the development to the surrounding area. It is crucial that the development proposal highlight
the agricultural land schemes and to stick to it firmly. The focal development needs to be controlled in order
to avoid scarcity of land. Through evaluation, the Land Development Authority need to play their part
actively. This is to ensure the smoothness of the development and to early detect any lack of development
process. Hence, ensuring the objective, ‘…to improve the quality of the livelihood of the settlers with a
dedicated and efficient management at all times, while contributing towards the accomplishment on the
nation’s vision through increased productivity to develop a competitive industry which is progressive and
profitable’ (Berita Publishing, 2002). Whereas the compensation is to be made by any commercial
developers that developed commercial on agricultural-pinned land.

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 TPS 515⃓ STRUCTURE OF GOVERNMENT

7) Conflict in the Environmental Law

Federal Constitution does not directly address “environment” and “environmental related matters”
even though matters pertaining to them are contained in Schedule 9 of the Constitution. (Adibah Awang,
2008). In fact, the term “environment” or “environment related matters” are nowhere defined by the
Constitution. Matters related to the environment however, appear in all the five list of Schedule 9 of the
Constitution. This means that both the Federal government and also the State government has jurisdiction
to legislate on environmental related matters. Hence, the study of conflict in the environmental law in
Chapter 7, based upon this constitutional set up, include identifying “environment” and “environment related
matters” under Schedule 9 and the conflict arising from this delineation of power between the Federal
government and State government. This study will also be illustrated by an analysis of the landmark
Bakun’s case. Despite the existence of statutory provisions for ensuring public participation in the planning
decision making process, such rights are rarely utilised. For instance in the Bakun Dam (Kajing Tubek &
Ors v Ekran Bhd & Ors. [1996] and on appeal to Court of Appeal) case, the public was denied the right to
participate in the environmental impact assessment approval process. The case consent application by a
Malaysian entrepreneur for the proposed 2400MW Bakun hydroelectric project which was reviewed under
the new Sarawak EIA procedures. It was alleged that the state government, with the apparent collusion of
the federal government, had used the state EIA procedures to facilitate the approval of the controversial
Bakun Hydroelectricity project on the upper Rajang river in the heart of the remaining vestiges of the tropical
rainforests. This was achieved by excluding the application of the Environmental Quality Act 1974 (a federal
legislation) to the state of Sarawak. The statutory rights guaranteeing public participation in planning
decision making, is the principal means in developed legal systems to incorporate the opinion of the public
whose environment can be affected by a particular development. This is largely absent in the Malaysian
planning system It was suggested above that conflict is inherent and inevitable in the Malaysian land law
under a federal system government. The Federal Constitution, the supreme law of the land, delineates
power with regard to land and land related matters between the Federal government and the various State
governments, allowing for diversity and also uniformity of its law and policy. Hence conflict arises out of
this division of powers.

Malaysia was one of the second generation of Asian countries to adopt Environmental Impact
Analysis (EIA) formally compared to countries such as the Philippines and Thailand which adopted EIA
legislation in 1977 and 1978 respectively. Until recently, EIA in Malaysia has been a federal government
responsibility. This situation has changed during the last few years with the peripheral, resource-rich states
of Sarawak and Sabah having enacted impact assessment procedures for natural resource management
and it is possible that other states may follow suit. At the moment, other states only have a limited role to
administer preliminary EIA reports under the jurisdiction of the federal government. The discussion will
focus on the circumstances which have precipitated this trend towards devolution of EIA and the
implications of fragmentation of a hitherto unitary national system in terms of its effectiveness. There is a
substantial body of recent literature focused on EIA which advocates the development of EIA systems
particularly suited to the needs of developing countries (for example, Lim, 1985; Biswas and Agarwala,
1992; Strömquist, 1992; Ebisemiju, 1993; Wood, 1995; Boyle, 1998; Glasson et al, 1999). A major
consideration in the development of institutional arrangements for an effective EIA system is the extent to
which responsibility for environmental decision-making should be centralised or decentralised (Doern and
Conway, 1994; Doyle and Kellow, 1995; Harrison, 1996; Holland et al, 1996). The Malaysian federal EIA
requirements have been in operation now for 12 years within the framework of the Environment Quality Act
1974 (EQA), which was enacted in 1974 as the major federal environmental statute; a new Department of
Environment (DOE) was established to implement this statute. The need for better environmental
management was formally endorsed in the Third Malaysia Plan (Government of Malaysia, 1976) and the
EQA is the basic instrument for achieving national environmental objectives. During the first ten years of its
administration, emphasis was put on curbing pollution by means of regulations gazetted under the Act. The
emphasis on control of pollution and the taking of remedial actions was a reflection of the magnitude of
environmental pollution problems and increasing public concerns. During the 1970s and 1980s, wastes
from agro-based industries (palm oil and rubber) were major problems. It was not until 1987 that EIA
procedures were introduced under the EQA to emphasise the importance of preventative controls. Once
again, this action was a response to the increasing magnitude of environmental problems in Malaysia as a
consequence of greater emphasis on growth-oriented structural adjustment programmes and liberalisation

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 TPS 515⃓ STRUCTURE OF GOVERNMENT

of the economy. Privatisation has been strongly encouraged since the early 1980s within the framework of
the five-year national development plans, and liberal investment policies were introduced by the federal
government to attract foreign capital.

It has taken considerable effort on the part of the DOE to improve the understanding and
acceptance of the EIA requirements by state and federal agencies and private-sector developers. The
Department has gradually established offices in state capitals to promote more effective co-ordination with
state government bureaucracy and developers and the processing of EIA reports has been progressively
decentralized to these regional DOE offices since 1993. The Malaysian system has been portrayed as a
working example of decentralisation of EIA activities among participants and tiers of government and an
effective mechanism for inter-governmental and inter-agency co-operation (Ebisemiju, 1993; Sani, 1993).
In this respect, the Malaysian federal EIA system may be described as gradually tending towards a
functionally decentralised model from its centralized genesis. The major constraint on the effectiveness of
the Federal government EIA procedures in Malaysia pertains to constitutional limits on its jurisdiction with
respect to environmental management. Under the Malaysian Federal Constitution land and water are under
the purview of state governments. Each state is empowered to enact laws on forestry, water resources,
mining, wildlife and fisheries. The management of these resources is beyond the scope of the EQA and the
role of the DOE. The Ninth Schedule of the Malaysian Federal Constitution provides for the general
distribution of legislative powers between the federal and state governments as follows: List I (Federal List)
List II (State List) and List III (Concurrent List). In addition, the Ninth Schedule includes list 2A (Supplement
to State List for Sabah and Sarawak) and List 3A (Supplement to Concurrent List for the States of Sabah
and Sarawak) which accord even greater control to the two states over natural resources when Sabah and
Sarawak joined the Federation in 1963. The state of Sarawak has exclusive jurisdiction to make laws
affecting land use, forestry (which includes the removal of timber and biomass), impounding of inland water,
diversion of rivers, electricity and the production of electricity generated by water, and local government.
Items not enumerated in the Ninth Schedule fall under state jurisdiction under the ‘residual’ category. As a
reflection of the dependence of the Sarawak economy on the export of natural resources coupled with its
distinctive ethnic identity, the state has over the years zealously guarded its constitutional autonomy against
perceived encroachment by the federal government. Thus, the scope of many federal statutes is limited in
Eastern Malaysia, while the bulk of the natural resource legislation in Sarawak comprises state enacted
laws. The jurisdiction of the majority of natural resource federal laws does not extend to Sarawak as these
matters are in the State List or the Concurrent List in the Federal Constitution. During the six years in
between 1994 - 2000, Sarawak has been successful in partially wresting control from the federal
government of EIA procedures specifically for resource-based development projects. On the strength of its
legislative powers under Article 77 of the Malaysian Constitution, in 1993 the state amended its Natural
Resources Ordinance 1949 to the Natural Resources and Environment Ordinance 1993 and established
the Natural Resources and Environment Board (NREB) to enforce the Ordinance. The purpose of the
Ordinance is to enable the state government to promote sustainable management of natural resources,
specifically items that are enumerated in the State List: land use, forestry, agriculture and in land water
resources. It is an enabling statute that is implemented by making subsidiary legislation or by cross-
referencing it in other statutes which it overrides.

The state of Sarawak has recognized that ‘environment’ is not enumerated in any of the Legislative
Lists and thus comes under the ‘residual’ category under state jurisdiction. The Natural Resources and
Environment Ordinance is a pre-Malaysia statute enacted in 1949 when Sarawak was governed by the
British colonial administration which succeeded the Brook administration in 1946. Under this Ordinance, a
state Natural Resource Board could prescribe certain activities which “may injure, damage or have adverse
impact on the quality of the environment or the natural resources of the State” to require the approval of the
Board before it could be implemented. However, these powers were not exercised until 1994. The Natural
Resources and Environment (Prescribed Activities) Order 1994 besides prescribing certain activities which
require the Board’s approval, also lays down procedures for the application for such approvals. The federal
government has removed these activities from the ambit of the federal EIA Order made under the
Environment Quality Act in 1987 (NERB, 1995). The process of preparing and evaluating EIA reports is
parallel to that under the federal EQA statute with one significant departure. The scope for public
participation is limited under the state EIA process compared to the federal EIA process. The EIA reports
submitted to the NREB are evaluated by a panel of experts drawn primarily from relevant government

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 TPS 515⃓ STRUCTURE OF GOVERNMENT

agencies, and the recommendations from the panel are taken into consideration in the approval process
by the Controller of Environmental Quality. In granting approvals to project proponents, the NREB
prescribes environmental conditions for protection and management. Project proponents must undertake
in writing to the Board to comply with all the conditions. Post-EIA monitoring is carried out by the project
proponents and the NREB secretariat. The fundamental difference between this Sarawak order and the
federal guidelines is essentially the entitlement in the federal EQA to a copy of the EIA report by the public
and the subsequent public comments to the Review Panel before an approval can be granted by the
Director-General. The Sarawak Order excludes these provisions. The NREB comprises a committee made
up of ex-officio members drawn primarily from state government ministries and departments which have
responsibilities for natural resources management. The committee is formally responsible for charting the
policy and direction of environmental protection and management in Sarawak. Following a 1997
amendment to the Ordinance, greater management responsibility has now been delegated to the Controller
of Environmental Quality, the head of the NREB (Mamit, 1997).

According to P.A. Memon (2000), a number of authors writing about EIA in developing countries
recommend that a precondition for the development of an effective EIA system is the establishment of an
independent national environmental agency. Such an agency should have considerable political influence
over sectoral agencies through placement in the office of the Prime Minister or a high profile ministry with
responsibility for national economic planning and budgetary control (Ebisemiju, 1993). This high-profile
arrangement places the agency in a strong position to exercise its controlling, supervisory and co-ordinating
roles in environmental matters, and guarantees adequate funding for its operations. It is also deemed
desirable because of the multi-sector character of EIA (Ebisemiju, 1993). Political clout, authority and legal
power are seen as essential in the context of circumstances in developing countries to enforce compliance
with environmental laws and regulations. However, the experience in Malaysia relating to the decision-
making processes for the Bakun dam points to the dominance of the strong developmental interests within
federal government bureaucracy. The federal government has shown itself to be just as vulnerable as the
states in this respect, even raising the spectre of possible collusion between the two. Neither the federal or
state governments function independently of markets.

Fragmentation of environmental regulation within Malaysia may also make it difficult to address
environmental problems such as air pollution which transcend state boundaries. On the other hand, a
central government environmental agency may lack there sources needed to carry out its functions
effectively in developing countries which are geographically extensive with adverse and differentiated civil
society. In the Malaysian case, the Federal Department of Environment has had relatively limited resources
to undertake its functions, especially in the peripheral regions in the two Borneo states. Partly because of
its control over natural resources, the Sarawak state by comparison has been able to devote more
resources to put in place an operational EIA system even though this may have been precipitated by the
events surrounding the proposed Bakun dam. To integrate environment and development effectively in the
policies and practices of a country, it is essential to develop and implement integrated, enforceable and
effective laws and regulations through appropriate legal and regulatory policies, instruments and
enforcement mechanisms at the national, state and local levels, and to enforce compliance with the laws,
regulations and standards that are adopted (IUCN, 1991). Countries need also to establish judicial and
administrative procedures for legal redress and remedy of actions affecting environment and development
that may be unlawful or infringe on human and environment rights. Properly mandated, empowered and
informed communities can contribute to decisions that affect them and play an indispensable part in creating
a securely-based sustainable society.

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 TPS 515⃓ STRUCTURE OF GOVERNMENT

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