KUALA LUMPUR: The Arbitration (Amendment) Bill 2024 (Act 646), which seeks to improve Malaysia's standing in the international arbitration community, has been tabled for first reading in Parliament on Monday (July 15).
It was tabled by Minister in the Prime Minister's Department Datuk Seri Azalina Othman Said, who also said the second reading of the Bill will be presented in the same meeting of the Dewan Rakyat.
Among the Bill’s key amendments is to Section 38 (1), which covers the recognition and enforcement of arbitration awards.
“Clause 9 seeks to substitute subsection 38(1) of Act 646 on the recognition and enforcement of an award made in respect of arbitration where the seat of arbitration in Malaysia or an award from a foreign state so as to harmonise the provision with the United Nations Commission on International Trade Law Model Law on International Commercial Arbitration (UNCITRAL Model Law).
“With this amendment, the award made in respect of the arbitration shall be recognised as binding at the first instance without requiring an application to be made to the High Court for its recognition,” the Bill read.
Without the amendments, an application in writing to the High Court is required for an award to be binding.
Other amendments were to Section 9, concerning the form of arbitration agreement.
“With this amendment, an arbitration agreement is in writing if it is contained in an exchange of any other documents and not just in an exchange of statement of claim and statement of defence.
The amendment also seeks to introduce a new Section 9A into Act 646 to provide that if the parties to the arbitration fail to agree on the law applicable to their arbitration agreement, the law applicable to the arbitration agreement shall be the law of the seat of the arbitration.
Meanwhile, the Bill also seeks to improve the organisational structure of the Asian International Arbitration Centre, in line with the execution of the Supplementary Agreement between the government of Malaysia and the Asian-African Legal Consultative Organisation relating to the Asian International Arbitration Centre in Kuala Lumpur dated Feb 20.
It also seeks to harmonise provisions in Act 646 with the UNCITRAL Model Law and by introducing provisions on third party funding.
At the same time, the Bill also introduces a new Section 46g which seeks to provide for the disclosure of a third-party funding agreement by the funded party to the other party to the arbitration, the arbitral tribunal and the court.
Following that, Azalina tabled the Construction Industry Payment and Adjudication (Amendment) Bill for the first reading.
She added that the second reading of the Bill will be presented in the same Dewan Rakyat meeting.
