MALAYSIA Law and Practice Contributed by: Samantha Chiang Xin Li, Yee Yik Shien and Tay Zi Li, Zi Li & Partners
ject to additional statutory regulation and certification requirements. Environmental Considerations The Environmental Quality Act 1974 (EQA) requires EIAs to be conducted for mining, dams and logging activities as well as oil and gas facilities, which fall within the definition of “prescribed activity” under the EQA (see 8.8 Environmental Health and Safety Laws ). The EQA also imposes obligations in respect of waste management and pollution control. Export Restrictions Malaysia imposes limitations on the export of natural resources through prescribing categories of goods that are absolutely prohibited from export and those that are conditionally prohibited, requiring licences or permits from the relevant authorities. In particular: • minerals – there is an express prohibition on the export of rare earth raw materials, while the export of certain minerals, ores and core requires an export licence issued by the Ministry of Natural Resources, Environment and Climate Change; • timber – logs and sawn timber may only be export- ed with an export licence from the relevant authori- ties, namely the Malaysian Timber Industry Board for export from Peninsular Malaysia and Labuan; the Sabah Forestry Department for export from Sabah; and the Sarawak Timber Industry Develop- ment Corporation for export from Sarawak; • palm oil – the export of palm oil is not prohibited but is regulated through the imposition of export duties and levies; • crude petroleum – the export of crude petroleum is subject to export duties; and • petroleum products – the export of diesel fuel, petrol RON 95 and liquefied petroleum gas requires an approval letter from the Controller of Supplies, Ministry of Domestic Trade and Cost of Living under the Control of Supplies Act 1961. Beneficiation Requirements Generally, Malaysia requires that natural resources contribute to domestic industrial growth rather than being exported in raw form. Investors in mineral pro- jects may be required to develop local smelting and refining facilities to obtain export approval. Similarly,
export duties are imposed on the export of crude palm oil so that it can be channelled into domestic refining and downstream industries such as oleochemicals and biodiesel. The export of rare earth raw materials is banned, making local processing a condition of par- ticipation. In summary, the overall policy direction is to ensure that greater value addition takes place within Malaysia before resources are exported. 8.8 Environmental, Health and Safety Laws Environmental Laws Under Section 34A of the EQA, any person intending to carry out a prescribed activity must appoint a quali- fied person to conduct an EIA and submit a report to the Department of Environment (DOE) for its approval prior to the commencement of such activity. The pre- scribed activities include a wide range of construc- tion projects and it is the responsibility of the project company to check whether an EIA is required for the proposed development and construction project. In addition, projects in Malaysia must also comply with other environmental regulations to prevent pol- lution. These include: • the Environmental Quality (Clean Air) Regulations 2014 – which set limits and procedures for manag- ing air emissions and controlling air pollution; • the Environmental Quality (Industrial Effluent) Regulations 2009 – which control the discharge of industrial effluent, including wastewater generated from construction-related activities; • the Environmental Quality (Scheduled Wastes) Regulations 2005 – which manage the classifica- tion, handling, storage, transport and discharge of scheduled waste; • the Environmental Quality (Sewage) Regulations 2009 – which control sewage discharge, includ- ing from temporary workers’ accommodation at construction sites; • the Guidelines for Environmental Noise Limits and Control – which regulate permissible noise levels from construction activities; and • the Guidelines for Erosion and Sediment Control – which provide best practices for managing surface run-off and preventing sedimentation.
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