MALAYSIA Law and Practice Contributed by: Rabindra S. Nathan, Rodney Gomez, K. Shanti Mogan and Alexius Lee, Shearn Delamore & Co
Shearn Delamore & Co 7th Floor Wisma Hamzah-Kwong Hing
No 1 Leboh Ampang 50100 Kuala Lumpur Malaysia Tel: +603 2027 2727 Fax: +603 2078 5625
Email: info@shearndelamore.com Web: www.shearndelamore.com
1. General 1.1 Prevalence of Arbitration
can Legal Consultative Organization and rebranded as the AIAC on 7 February 2018. In 2023, another arbitral institution – ie, the Borneo International Centre for Arbitration and Mediation (BICAM) – was established in Malaysia. The BICAM is currently situated in the Sabah International Con - The AIAC maintains its own rules of arbitration, known as the AIAC Arbitration Rules. The AIAC takes the ini - tiative to actively upgrade the AIAC Arbitration Rules from time to time in accordance with international trends, to cater for best practices in the global envi - ronment. The AIAC Arbitration Rules 2026 have been issued. The AIAC also released the AIAC i-Arbitration Rules, which offer a practical solution for the settling of dis - putes arising out of or in connection with Shariah- based commercial transactions, enabling the arbitral tribunal to refer to the relevant Shariah Advisory Coun - cil or Shariah expert for opinions on matters related to Shariah principles. The AIAC i-Arbitration Rules 2026, which took effect from 1 January 2026, are the latest i-Arbitration rules. vention Centre (SICC). The AIAC’s Initiatives The AIAC also released its inaugural Asian Sports Arbitration Rules 2026, which cater to the needs of the sports industry and provide an effective and efficient mechanism for resolution of sports-related disputes.
Litigation continues to be the primary method of resolving disputes in Malaysia, for both domestic and international disputes. This is not expected to change in the near future. The Asian International Arbitration Centre (AIAC) has not published its statistics for 2025. Based on the AIAC Annual Report 2024, the AIAC handled 96 domestic cases and 11 international cases in 2024. The num - ber of domestic arbitrations has been increasing in recent years (from 67 domestic arbitrations in 2022 to 92 domestic arbitrations in 2023) and is expected to improve further. The number of international arbitration registrations at the AIAC has been relatively constant over the last few years. 1.2 Key Industries AIAC statistics indicate that the majority of arbitra - tions registered in 2024 related to construction con - tracts (48.60%), followed by shareholder and supply contract disputes. This is largely consistent with the trend in previous years. The authors expect this trend to continue in 2026. 1.3 Arbitration Institutions The arbitral institution most used for international arbi - tration in Malaysia is the AIAC. The AIAC, previously known as the Kuala Lumpur Regional Centre for Arbi - tration, was established in 1978 under the Asian-Afri -
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