Putrajaya – In a bid to modernize its digital trade landscape, Malaysia’s Ministry of Domestic Trade and Cost of Living (KPDN) convened an engagement session with approximately 300 stakeholders, ranging from e-commerce platforms and vendors to tech users, to discuss proposals for refreshing the country’s e-commerce legal framework. The session, held at Zenith Hotel in Putrajaya, was led by Minister Datuk Armizan Mohd Ali, supported by Deputy Minister Senator Datuk Dr Fuziah Salle and senior officials from KPDN.
The gathering was part of a structured review process ongoing in 2025, aiming to update Malaysia’s e-commerce statutes to reflect evolving business models, cross-border trade realities, and rising consumer protection expectations.
Key Proposals & Focus Areas
Minister Armizan and his team spotlighted several contentious but forward-leaning proposals during the dialogue:
- Extraterritorial Powers over Foreign Platforms
The Ministry floated plans to grant regulatory authority over foreign e-commerce entities operating in Malaysia, even if domiciled abroad. This proposition seeks to ensure foreign platforms are held to domestic consumer protection, tax remittance, and regulatory compliance standards. - Clear Regulatory Roles & Obligations
There was a call for more explicit definitions in the law delineating responsibilities for platforms, vendors, operators, and end users. The aim: reduce gaps or ambiguity in enforcement and accountability across the e-commerce value chain. - Regulatory Harmonisation & Cross-Jurisdiction Coordination
Officials emphasized the importance of government-to-government (G2G) cooperation, harmonising legal regimes with partner markets and facilitating enforcement across borders.
Participants at the session engaged robustly, raising pointed questions on jurisdiction, enforcement logistics, vendor cost burdens, platform liability, data privacy, and how to balance regulation with innovation. Minister Armizan, Deputy Minister Fuziah, and Chief Secretary Dato’ Seri Mohd Sayuthi responded to concerns, attempting to reassure that the legislative effort is meant to be inclusive, adaptable, and future-ready.
Timeline & Governance Process
According to the report, KPDN is in the final stages of its review. The intention is to conclude the revision of current e-commerce laws by end of August 2025, after which a draft Bill will be tabled for review by the Cabinet and Attorney General’s Chambers for approval.
The process is supported by Frost & Sullivan, engaged as a consultant to map regulatory gaps and recommend legal improvements. The legal advisory role is held by Richard Wee Chambers, a branch of the Grandall Law Firm.
Implications & Challenges
This legislative effort carries significant ramifications for Malaysia’s digital economy, cross-border trade, tech sectors, and consumer markets:
- Regulatory certainty & trust: A robust, clear e-commerce law can reduce risk for platforms and vendors, encouraging investment, innovation, and fair competition.
- Competition & compliance costs: Platforms may face increased compliance burdens (registration, reporting, taxation), especially smaller players. Striking balance is key.
- Cross-border friction: Issuing extraterritorial powers over foreign firms might invite diplomatic or trade pushback, especially where mutual legal assistance is limited.
- Consumer protection & redress: Modern commerce frameworks should strengthen rights (returns, refunds, liability), dispute resolution, and recourse for consumers.
- Technological alignment: Laws must anticipate new models, e.g. social commerce, in-app marketplaces, AI-mediated transactions, digital wallets, rather than lag.
- Data governance & privacy: As legislation expands control, ensuring compliance with personal data protection laws and international norms is critical.
Written by Ashley Yip, Richard Wee Chambers
