Friday, October 16, 2026

2026 HAZE CRISIS IN SOUTHEAST ASIA

Singapore’s Transboundary Haze Pollution Act 2014, current regional conditions, and a proposed Malaysian legal and scientific response.

By Muhammad Syawalfiza.

Comprehensive policy and legal essay

Scope note: This is a research and policy analysis, not legal advice. Any bill should be checked against consolidated Malaysian statutes, current commencement orders, constitutional allocations of power, and professional advice before drafting or enactment.

Abstract

Transboundary haze remains a recurring environmental, public-health and governance problem in Southeast Asia. Its severity varies across years and sub-regions because fire activity interacts with land use, peat drainage, drought, seasonal winds and atmospheric chemistry. Malaysia is affected both by fires within its own borders and by smoke transported from neighbouring states. The latest available Malaysia-specific scientific evidence includes a 2025 chemical-weather modelling study of the 2019 transboundary-smoke episode, a 2025 Malaysian-led study forecasting PM₁₀ up to 72 hours ahead, and a 2024 nationwide study associating haze-period PM₁₀ exposure with respiratory hospital admissions over subsequent days. These studies support better forecasting, monitoring and prevention, while also demonstrating why satellite hotspots or population-level associations cannot alone establish a particular company’s liability for an individual injury.⁹˒¹⁰˒¹¹

Singapore’s Transboundary Haze Pollution Act 2014 (THPA) provides a significant statutory model: it reaches qualifying overseas conduct, provides criminal and civil liability for entities, permits preventive notices and creates rebuttable evidentiary presumptions. Yet legal design is not the same as demonstrated effectiveness. Cross-border jurisdiction, source attribution, foreign evidence, disputed land concessions, service of process, choice of law and enforcement against overseas assets remain important constraints.¹˒²˒³

This essay recommends that Malaysia develop a carefully defined transboundary-haze law, either as a dedicated Act or a coordinated statutory package. It should provide an individual civil cause of action for proven injury, including reasonable future treatment and lifelong care where medically justified; a possible interim health-compensation mechanism; targeted corporate and individual liability; proportionate civil and criminal remedies; and an asset-recovery pathway for qualifying proceeds of serious environmental crime. US 1MDB forfeiture proceedings illustrate how property linked to unlawful proceeds can be pursued and repatriated, but forfeiture must remain distinct from victim compensation. Existing Malaysian powers under the Environmental Quality Act, AMLA and anti-corruption legislation should be mapped before creating duplicates. 

The essay also evaluates probabilistic climate-event attribution, adaptive governance, the social cost of carbon, One Health evidence and Earth System Law. These are not equally mature legal tools: several support near-term evidence and prevention protocols, while carbon-damage valuation and regional Earth System Law proposals require further methodological and legal development. The central conclusion is practical rather than punitive: a credible law must connect a clear duty, reliable evidence, a legally responsible actor, a court with lawful jurisdiction, and a remedy that can actually be enforced.

1. Introduction

Transboundary haze is not simply a temporary visibility problem. It is the downwind consequence of fire emissions moving across political borders, often during dry conditions, with effects on air quality, health, transport, schooling, economic activity, ecosystems and climate. The recurrent fires in Equatorial Asia have generated regional disputes because the activity that starts a fire, the land rights governing the burn, the corporate group benefiting from land conversion and the population breathing the resulting smoke may be located in different jurisdictions. The legal challenge is therefore both environmental and transnational.¹˒¹²˒¹⁴

Malaysia is now considering whether a specific statute could strengthen its response. The Edge Malaysia reported on 25 September 2026 that the Ministry of Natural Resources and Environmental Sustainability (NRES) was examining Singapore’s approach and that a multi-agency committee had been directed to consider options. Subsequent reporting has stressed that effectiveness, enforceability, burden of proof, diplomatic implications and compatibility with existing laws require careful assessment. These are questions a serious legislative proposal should answer before finalising the form of the Act.¹⁶˒³²

This essay assesses the science and current conditions, Singapore’s THPA, ASEAN cooperation and comparative EU and US tools. It then develops options for Malaysia on jurisdiction over foreign actors, corporate responsibility, criminal enforcement, compensation for individuals, non-conviction-based asset recovery and practical prevention. It avoids assuming that all regional haze originates abroad, that every hotspot proves an offence, or that the enactment of a statute by itself will solve the problem.

2. Method, evidence hierarchy and limitations

The research cut-off is 16 October 2026. The source base prioritises legislation and official materials for legal propositions; peer-reviewed Malaysian and regional research for scientific claims; and official meteorological, air-quality and education authorities for the current episode. News reports are used to describe the policy process and time-specific events, not to replace scientific evidence or judicial findings. Alan Khee-Jin Tan’s The Haze Crisis in Southeast Asia: Assessing Singapore’s Transboundary Haze Pollution Act 2014 by National University of Singapore Centre for Asian Legal Studies working paper first dated February 2015 and revised in July 2016. Its analysis is valuable for understanding the original Act’s structure and expected enforcement difficulties, but it is not a current evaluation of every subsequent development.¹

The essay also uses the 2025 article by Chong and Schacherer, which revisits extraterritorial liability and enforcement, and current Singapore statutory text. This is important because the Act’s original ambitions and the practical record must not be conflated.²˒³

A limitation is that the newest Malaysia-specific peer-reviewed health study identified for this essay uses hospital and pollution data from 2000 to 2019, whereas recent modelling studies use the 2019 smoke event for validation. They do not measure the complete health burden of the October 2026 episode. The current episode is described using official reports and regional meteorological outlooks; no unsupported estimate of Malaysia-wide haze-attributable deaths or disease is made.⁸˒⁹˒¹⁰˒¹¹ The additional climate-governance analysis draws on peer-reviewed literature on probabilistic event attribution, statistical uncertainty, adaptive governance, the social cost of carbon, One Health and Earth System Law, together with a May 2026 review of peatland fire ecology and management in Malaysia. These sources inform options for evidence design and governance; they do not, by themselves, establish a rule of Malaysian law, prove corporate culpability in a particular fire, or make climate damages automatically recoverable.³⁶˒³⁷˒³⁸˒³⁹˒⁴⁰˒⁴¹˒⁴²˒⁴³

3. The science of Southeast Asian haze

3.1 Fire, peatland and weather

Haze forms when smoke aerosols and gases enter the atmosphere and are transported, mixed and chemically transformed. Fine particulate matter, particularly PM₂.₅, is important because it can penetrate deep into the respiratory system. PM₁₀ is also routinely monitored and has been used in Malaysia-specific epidemiological and forecasting studies. Fire smoke is a mixture, not a single pollutant: it can include primary particles, carbon monoxide, volatile organic compounds and gases that form secondary aerosols and ozone. Chemical composition and measured concentrations change with the fuel, moisture, fire intensity, atmospheric ageing and weather.¹²˒¹⁴

Tropical peatlands matter because peat contains partially decomposed organic material accumulated over long periods. Drainage lowers water tables and dries peat, making it more vulnerable to smouldering fires that can persist below the surface and be difficult to extinguish. Agricultural expansion and other land-use changes have altered fire risk in parts of Equatorial Asia. Kuwata’s 2024 review concludes that the recurrence and severity of peatland-fire haze are associated with human-driven land-use change interacting with meteorological factors, including El Niño and Indian Ocean Dipole variability. The 2015 event demonstrated how dry weather and extensive peat fires can produce large regional emissions, but its historical scale should not be presented as a forecast of every later season.¹²

The causes and seasonality of haze are not identical across Southeast Asia. In the southern ASEAN region, smoke from fires in Sumatra and Kalimantan can be transported toward Malaysia and Singapore during dry periods with suitable winds. The northern Mekong sub-region also experiences seasonal haze from agricultural and forest burning, often around a different part of the year. Laws and cooperation must therefore be designed for multiple fire sources and different regional patterns, rather than treating all air pollution in the region as one undifferentiated Indonesian export.

3.2 Current regional and Malaysian situation as at 16 October 2026

The ASEAN Specialised Meteorological Centre’s October–December 2026 outlook reports El Niño conditions and a high probability of below-normal rainfall in much of the Maritime Continent and parts of eastern Mainland Southeast Asia. It anticipates an elevated risk of hotspots and smoke haze in the southern ASEAN region while also noting that increasing showers as inter-monsoon conditions emerge could provide some relief. This is a probabilistic outlook, not a statement that every locality will remain severely polluted or that any specific fire can already be attributed to a named company.⁸

Malaysia experienced a notable haze episode in October 2026. Official reporting stated that Batu Pahat’s Air Pollutant Index (API) reached 203 at 8 p.m. on 7 October, a reading categorised as “very unhealthy”, and that temporary school closures and other restrictions followed in several affected areas. On 15 October, the Education Minister said the National Haze Action Plan thresholds would guide responses, including closure when the API reaches 200 and suspension of outdoor activities when readings exceed 100. These readings are time- and location-specific; they should not be represented as the condition of all Malaysia on 16 October.¹⁷˒¹⁸

Reporting on 13–15 October also described continuing fires in Indonesia and haze effects in neighbouring states. Reuters reported regional impacts on 15 October, but estimates of burned area and disease burden vary by source and methodology and are not treated here as verified national totals. For policy design, the ASMC outlook, Malaysian official API-related actions and peer-reviewed Malaysian evidence are the stronger bases. A proper legal proceeding would need episode-specific monitoring, meteorological evidence and source attribution, rather than reliance on media reports.⁸˒¹⁷˒¹⁸˒³⁴

An operational implication is immediate: the state should not wait for a lawsuit to protect people during a severe episode. Public-health messaging, school and outdoor-work thresholds, timely API publication, clinical readiness, and targeted protection for children, older people, outdoor workers and people with pre-existing cardiopulmonary conditions remain necessary regardless of whether a transboundary source can later be proved. Contemporary Malaysian media reporting also reflects health concerns during the episode, but that reporting should not be mistaken for a new epidemiological study.³³

4. Latest Malaysia-specific scientific evidence

4.1 Hospital admissions and PM₁₀

Mohd Zulkifli, Samsudin and Majid published a study in *Scientific Reports* in 2024 using respiratory-disease admissions from 92 Malaysian government hospitals and PM₁₀ and meteorological data from 92 monitoring stations across Peninsular Malaysia for 1 January 2000 to 31 December 2019. The study defined the haze period as June to September and used time-series and distributed-lag methods to analyse subsequent admissions. It found a positive association between haze-period PM₁₀ and respiratory hospitalisation over lagged days, including statistically significant results at later lags. The authors reported that women and people of working age were more susceptible in their analysis.¹¹

The policy importance is that the health burden need not be confined to the same day that high particulate levels are recorded; public-health surveillance should examine lagged effects and the use of hospital services after an episode. The limitations are equally important. The observation period ends in 2019, the analysis is population-level, and an association between pollution and admissions does not determine whether a particular company or fire caused an individual person’s disease. It cannot be used as a ready-made formula for lifetime damages in a private lawsuit. Those questions require an individual medical assessment, reliable exposure evidence and a legal causation test.

4.2 Modelling PM₁₀ and improving public warnings

Rahim and colleagues published a Malaysian-led study in *Analytical Science Advances* in 2025 developing modified quantile-regression models to predict PM₁₀ concentrations one to three days ahead in Klang, Melaka, Pasir Gudang and Petaling Jaya. The models combined quantile regression with feature-selection methods and were validated against unseen 2019 data. The reported results indicate that carefully selected input variables can improve short-term prediction compared with conventional regression approaches. The models are useful as decision-support tools for readiness and public warnings, but their accuracy can vary by location, prediction quantile and future event.¹⁰

4.3 Modelling PM₂.₅ transport in the 2019 event

Mohd Napi and colleagues’ 2025 *Atmospheric Environment* paper evaluated the WRF-CMAQ chemical-weather model for the 2019 transboundary smoke event in Peninsular Malaysia. The authors found that meteorological nudging and adjusting the fire-emission input improved model performance for PM₂.₅ and ozone; their tuned WRF-CMAQ approach performed better than the CAMS and MERRA-2 products assessed in that case study. The key legal lesson is not that the model proves which company was responsible. It is that transport attribution depends materially on meteorological data and realistic fire emissions. A haze statute should fund model validation, preserve input data, require experts to disclose uncertainty, and distinguish regional source attribution from company-specific responsibility.⁹

4.4 Peer-reviewed regional science and the need for more field data

Kuwata’s 2024 review of tropical peatland-fire haze synthesises evidence on emissions, atmospheric chemistry, particle properties and impacts across Equatorial Asia. It describes improvements in satellite observation and modelling, while calling for stronger integration of in-situ atmospheric measurements with epidemiological research.¹² This is important for Malaysia because a future lawsuit may require evidence at several scales: where and when fires occurred, how smoke plausibly travelled, what concentrations people experienced, and whether a specific claimant suffered a legally attributable injury.

The Academy of Sciences Malaysia’s Local and Transboundary Haze Study, launched in 2018, is an earlier but still useful local policy reference. Its structure links air quality and haze episodes, peatland and water management, and waste-to-resource options. Its recommendations included better fire prevention on peatland, rehabilitation of abandoned or underdeveloped peat areas, stronger enforcement against open burning, improved climate forecasting, local contingency plans and better assessment of health and social burdens. It also emphasised that a problem rooted in socioeconomic conditions requires socioeconomic solutions.¹³

The evidence base does not justify a claim that Malaysia already has a complete peer-reviewed epidemiological account of each recent haze episode. The practical recommendation is for the Ministry of Health, Department of Environment, universities and meteorological agencies to develop a routinely updated linked dataset, with appropriate privacy protections, joining air pollution, fire activity, atmospheric transport, emergency visits and hospital admissions. Such evidence would improve prevention and could later support fair compensation claims without pre-judging the liability of any person or company.

5. Malaysia’s current legal position

Malaysia has not started from a legal vacuum. The Environmental Quality Act 1974 (EQA) contains domestic pollution-control powers, including section 29A on open burning. The Environmental Quality (Amendment) Act 2024 (Act A1712), in force from 7 July 2024, strengthened the provision. The amended section 29A prohibits a person from committing, allowing, instructing or causing open burning on any premises. Conviction may result in a fine of RM25,000 to RM1 million, imprisonment of up to five years, or both, plus a continuing-offence fine of up to RM5,000 per day after a notice requiring the conduct to cease.⁴˒⁵

This amendment matters for two reasons. First, the substantive domestic law is more recent and the penalty ceiling higher than some older Department of Environment web guidance still indicates. The enacted amendment, commencement notification and consolidated statute should govern legal analysis.⁴˒⁵˒⁶ Secondly, stronger domestic penalties do not by themselves resolve conduct taking place wholly in a foreign jurisdiction, parent-company decision-making, evidence located overseas or an individual claimant’s ability to secure damages against a foreign entity. Those are the gaps a dedicated transboundary framework must address.

Malaysia also has broader legal tools that may become relevant if a haze incident involves bribery, fraud, concealment or criminal proceeds. The Malaysian Anti-Corruption Commission Act 2009 includes corporate liability for defined bribery involving associated persons under section 17A. AMLA contains mechanisms to investigate money laundering and seek forfeiture of property connected with unlawful activity, including in specified circumstances without a prosecution or conviction. These laws must be used only when their own elements are satisfied; haze pollution is not automatically bribery or money laundering.²⁵˒²⁶

The Ministry’s reported proposal should consequently be approached as a targeted extension and coordination project. The legislative review should map existing offences and powers before deciding what requires a new Act, an amendment to the EQA, an amendment to AMLA or the MACC Act, new civil remedies, or administrative protocols. Duplicating offences can create conflicting definitions, unclear enforcement responsibility and litigation over which statute applies.

6. ASEAN’s regional framework

The ASEAN Agreement on Transboundary Haze Pollution was signed in Kuala Lumpur on 10 June 2002 and entered into force on 25 November 2003. Indonesia ratified it in 2014 and deposited its instrument in January 2015, after which all ASEAN member states were parties. The Agreement supports cooperation in prevention, monitoring, assessment, early warning, information exchange and mutual assistance.⁷
ASEAN cooperation remains indispensable because the fires and smoke do not respect national borders. It helps with common technical standards, firefighting assistance, regional weather outlooks and diplomacy. 

Nevertheless, the Agreement is not a regional civil court; it does not create a general private compensation system for a Malaysian person injured by smoke or directly provide a centralised mechanism to confiscate a private company’s foreign assets. Domestic statutory duties and remedies can complement the treaty, while the treaty provides a platform for cooperation.

Malaysia should not frame the law as an alternative to diplomacy or as a verdict that all responsibility lies abroad. It should enforce Malaysian burning restrictions credibly, cooperate with Indonesia and other source states, and use science diplomacy for shared data and technical assistance. In July 2026, Malaysia publicly proposed science diplomacy and a Sustainable Haze Fund under the ASEAN haze framework. The proposal should be evaluated as a potential cooperative tool, not described as an already-operational regional fund unless later official documentation confirms establishment and funding.¹⁹

7. Singapore’s Transboundary Haze Pollution Act 2014

7.1 What the Act does

Singapore enacted the THPA in response to the severe June 2013 haze episode. The Act extends to qualifying conduct outside Singapore that causes or contributes to haze pollution in Singapore. Section 5 establishes offences for entities whose conduct causes or contributes to haze pollution, or that condone such conduct by another entity or individual, and also addresses an entity participating in the management of a land-owning or land-occupying entity. Section 6 establishes statutory civil duties and a route for an affected party to seek damages for qualifying personal injury, disease, physical or mental incapacity, property damage and economic loss. Sections 7 and 8 address defences and evidentiary presumptions; the Act also provides for preventive-measures notices.²

The THPA is notable because it moves beyond the territorial location of the fire. It does not require the overseas conduct to take place in Singapore before the statute can become relevant. The law also recognises that corporate control and operational management may sit in a different entity from the entity holding land or carrying out the activity on the ground. This is a particularly useful design lesson for complex plantation and forestry groups.

Singapore’s Act sets an offence fine of up to S$100,000 for each day or part-day of qualifying haze pollution, subject to an aggregate cap of S$2 million. A further fine of up to S$50,000 per day may be available for non-compliance with a preventive-measures notice. These are statutory maxima, not evidence that such fines have routinely been imposed or collected.²

7.2 Presumptions and evidentiary risks

Section 8 includes rebuttable presumptions addressing the relationship among haze pollution, fire locations and smoke movement shown by satellite and meteorological evidence; the ownership or occupation of land shown by specified maps; and the conduct of an entity linked to the relevant land or another entity’s management. The objective is to address the practical fact that authorities may be able to observe smoke and fires more readily than they can obtain direct evidence of who authorised the burning.²

These mechanisms are powerful, but they create serious drafting responsibilities. Maps may be outdated, overlap, or reflect disputed or layered land rights. Satellite hotspots are not infallible fire-site proof. Wind direction supports atmospheric transport analysis but may not isolate one company where multiple fires occur. Corporate-group relationships do not necessarily prove actual operational control. Tan’s supplied paper anticipated that reliable concession maps, meteorological evidence and proof of the management relationship would be among the hardest issues in enforcement.¹

Malaysia could adopt tailored evidentiary presumptions, but should keep them rebuttable and anchored in reliable independent evidence. In criminal proceedings the prosecution must still prove the offence to the applicable criminal standard, subject to the exact statutory allocation of evidential and legal burdens. Civil proceedings should use the civil standard and permit a full response from the defendant. Presumptions should assist legitimate fact-finding, not convert a hotspot or company shareholding into automatic guilt.

7.3 The Act’s practical limitations

The 2025 article by Chong and Schacherer examines the THPA’s interaction with extraterritorial jurisdiction, choice of law, enforcement of foreign judgments and the ASEAN Haze Agreement. It identifies substantial practical barriers to holding foreign actors accountable even when the domestic statutory basis is ambitious.³ The paper makes clear that a statute can confer jurisdiction without guaranteeing that investigators can access foreign land records, compel evidence abroad, serve a defendant effectively or enforce a judgment against assets located in another state.

There is also a need to distinguish statutory design from demonstrated enforcement outcomes. Tan’s working paper assessed what could be expected when the Act entered into force; Chong and Schacherer revisit the cross-border problem a decade later. Neither should be represented as a substitute for current official case statistics. As at the research cut-off, this essay did not identify a publicly reported, final THPA merits judgment establishing a generally applicable template for successful prosecution or private compensation. This should be stated as a limitation of the reviewed public record, not proof that the Act has no deterrent, diplomatic or investigative effect.¹˒³

Singapore’s example therefore supports a Malaysian Act with both substantive and implementation provisions: clear liability; legally accessible records; a defined service mechanism; evidence cooperation; adequate investigative resources; and a remedy that is realistically enforceable. Malaysia should not copy presumptions, penalties or jurisdictional language mechanically without reviewing local procedure, constitutional principles, state responsibilities and diplomatic context.

8. EU and US tools Malaysia could adapt

8.1 EU environmental criminal law

Directive (EU) 2024/1203 on the protection of the environment through criminal law is a useful reference for a graduated system of serious environmental offences, liability of legal persons, effective and proportionate sanctions, confiscation and enforcement cooperation. It reflects the principle that some environmental conduct should be treated as crime rather than only as a licence or administrative matter.¹⁵ The Directive binds EU member states within the EU legal order; it does not itself confer EU enforcement jurisdiction on Malaysia. Malaysia should borrow principles, not transplant the EU jurisdiction wholesale.

A Malaysian law should distinguish at least three levels of conduct: accidental or unavoidable fire events; breaches of specific fire-prevention duties; and serious unlawful burning or facilitation committed intentionally, knowingly or with the degree of recklessness or negligence expressly defined by the statute. Criminal liability should depend on defined actus reus and mens rea elements. Civil remedies can apply to a different class of conduct where the claimant proves the legal requirements, without requiring criminal conviction.

Penalty calibration should take account of culpability, injury, duration, recurrence, benefit gained, ability to pay, compliance history and the cost of remediation. Corporate fines may be linked to financial capacity or unlawful benefit where carefully defined, but a turnover-based sanction should not be treated as an automatic solution. Penalties must be predictable and reviewable by an independent court.

8.2 EU deforestation and US Lacey Act principles

The EU Deforestation Regulation establishes due-diligence and traceability requirements for specified commodities and products associated with deforestation or forest degradation, including relevant palm-oil and wood products. Its focus is product and production legality, not every haze episode.²⁰ Malaysia can adapt the principles of geolocation, supply-chain documentation, responsible-operator duties, records and consequences for false declarations. The regulation’s scope and implementation schedule have changed over time; Malaysian drafters should refer to the consolidated EU text rather than repeat obsolete dates.²⁰

The US Lacey Act provides another model: trade in specified plants and plant products can be prohibited where they were taken, possessed, transported or sold contrary to applicable laws.²¹ It is not a general transboundary-haze law, but it demonstrates that source-country illegality can matter to downstream commercial transactions. Malaysia could consider due diligence for designated high-risk commodities or land-clearance operations, with requirements proportionate to risk and the size and role of the business.

Beneficial-ownership transparency and concession mapping would support both these models. Where several subsidiaries, suppliers and contractors operate across a large area, a register should make it possible to identify the parcel, actual operator, relevant corporate controller and responsible manager. Data should be sufficiently reliable for enforcement, with a process for correcting disputed records and protecting legitimate confidential information.

The EU’s wider corporate sustainability reporting and due-diligence framework was amended by Directive (EU) 2026/470. This is relevant as an example of a moving regulatory baseline: its scope, company thresholds and timelines should be checked in the consolidated text rather than treating earlier EU rules as unchanged. Malaysia could consider targeted, risk-based fire and land-clearance due diligence, but should not assume the EU instrument directly applies in Malaysia or that all of its obligations are appropriate for Malaysian producers.³⁵

8.3 US specialist environmental prosecution and financial offences

The US Department of Justice’s Environmental Crimes Section illustrates the value of specialist prosecutors working with environmental investigators and scientific experts.²³ Malaysia need not replicate a US federal structure to adopt the core operational lesson: complex environmental cases require people who understand remote sensing, atmospheric modelling, corporate records, chain of custody, criminal procedure and financial investigations.

US anti-bribery and accounting law offers a more limited supplementary analogy. The Foreign Corrupt Practices Act (FCPA) applies to specified persons and entities within its statutory jurisdiction and addresses bribery of foreign officials and, for covered issuers, books-and-records and internal-control duties.²² It is not a general criminal prohibition on haze. In Malaysia, MACC Act section 17A can become relevant if there is evidence that an associated person bribed an official to obtain or retain business or a business advantage for a commercial organisation. The appropriate offence must be proved; the connection to haze alone is insufficient.²⁶

FATF’s work on money laundering from environmental crime explains how illegal extraction, logging and other environmental offences can produce proceeds that are moved through businesses and the financial system.²⁴ For serious haze cases, agencies should ask whether illegal land clearance generated proceeds, whether officials were bribed, whether land or supply-chain records were falsified, and whether relevant money was concealed. These investigations should be pursued only when evidence supports the elements of a qualifying offence.

9. Individual compensation for haze-related injury

9.1 A statutory right to seek full legally recoverable loss

Malaysia should create an express civil cause of action for people who establish that unlawful conduct covered by the Act caused or materially contributed to a qualifying injury in Malaysia. The cause of action should not depend automatically on a criminal conviction; civil liability and criminal guilt have different purposes and standards of proof. However, the claimant must still prove the statutory duty, the defendant’s legally relevant conduct, injury and the required causal connection.

Compensation should be able to cover past and future medical expenses, specialist care, prescribed medication, rehabilitation, medically necessary equipment, nursing and personal care, reasonable caregiving costs including qualifying care provided by family members, necessary home adaptations, loss of earnings and earning capacity, and legally recoverable damages for pain, suffering and loss of quality of life. A claim arising from death should address eligible dependency and estate claims under the relevant law.³¹ Future and lifelong care should be available where a qualified prognosis supports the need; it must not be awarded automatically for every respiratory complaint.

The court should be able to assess future costs using medical evidence and, where necessary, actuarial or other expert estimates. The legislation should consider whether periodic or structured payments can be authorised to address long-term care, inflation, changing needs and risk of the payer’s insolvency. It should also provide safeguards for minors and people who cannot manage their own awards. If periodic payment is not otherwise available under Malaysian procedural law, the new Act would need to confer that power expressly.

9.2 Scientific causation and evidentiary standards

Air pollution science can show that particulate exposure is associated with population-level health effects. It cannot, by itself, prove that a specific company caused an individual’s condition. The Malaysian 2024 hospital-admission study supports the public-health importance of PM₁₀ exposure during haze periods, but its period, design and population-level findings do not eliminate the need for individual medical and exposure evidence.¹¹

A statute can improve access to evidence by allowing court-supervised disclosure of specified concession records, fire-prevention plans, contractor instructions, monitoring records and incident reports. It can support expert evidence using official monitoring, validated satellite products, fire chronology and atmospheric transport models. It should also require disclosure of uncertainty, model assumptions and plausible alternative fire sources. A hotspot is an investigative lead, not proof of a particular landholder’s guilt. Multiple fires and mixed regional pollution can make source attribution difficult.

Malaysia should consider carefully limited rebuttable evidentiary presumptions once a claimant or prosecutor has established a reliable foundation, such as a qualifying exposure, a recognised injury and a credible source-attribution case. The details need to differ between civil and criminal proceedings. The legislation must not presume that a particular individual’s lifelong disease was caused by haze simply because air quality was poor, nor should it make a defendant liable merely because it owns shares in a company associated with land.

9.3 Interim healthcare and a Haze Health Compensation Fund

Cross-border litigation can take years, while medical needs begin immediately. Malaysia should examine a dedicated Haze Health Compensation Fund to provide defined interim assistance for urgent treatment or other eligible costs while an individual pursues a claim or authorities investigate sources. This would be a policy option, not an existing scheme. It could be funded initially through public appropriations, with possible future contributions from carefully designated high-risk operators, recovered costs and other legislatively authorised sources.

The fund’s eligibility process should be transparent, medically grounded and reviewable. Interim payments need not amount to a final finding that a named company is liable. Legislation should provide a recovery or subrogation route against a responsible party where justified, coordinate fund payments with civil damages, and prevent double recovery for the same loss. Independent audit, protection of personal medical data and appeals against decisions are necessary.

The World Health Organization’s global air-quality guidelines supply a health-based benchmark for PM₂.₅ and PM₁₀ exposure and reinforce the need to reduce population exposure.¹⁴ Those guideline values are not a direct legal test of individual injury or a replacement for Malaysia’s API and regulatory system. The essay should therefore separate three questions: public-health action when pollution levels rise; proof of individual injury; and proof that the defendant is legally responsible for that injury.

10. Cross-border loopholes and enforcement gaps

10.1 Jurisdiction over foreign entities and individuals

A Malaysian Act should expressly define the conduct abroad that falls within its scope and the required connection to Malaysia. A mere showing that the defendant is foreign or that Malaysia experienced haze is too broad; conversely, requiring every relevant act to occur inside Malaysia would defeat the object of a transboundary statute. Potential connecting factors include Malaysian incorporation, Malaysian management or decision-making, conduct within Malaysia, or defined overseas conduct causing or materially contributing to qualifying harm in Malaysia. The exact scope must be compatible with public international law, constitutional principles and due process.

The legislation should distinguish jurisdiction to prescribe, jurisdiction to adjudicate, and jurisdiction to enforce. Parliament may define when Malaysian law applies, and a Malaysian court may have jurisdiction under the statute, but enforcement officers cannot exercise coercive powers on another state’s territory without lawful cooperation. Foreign documents, interviews, inspections, asset freezes and seizure of property may require mutual legal assistance, local court orders or recognised international arrangements.

10.2 Corporate groups, directors and contractors

Separate legal personality remains a fundamental feature of company law. A Malaysian parent should not be automatically liable for every fire associated with a foreign subsidiary. The Act should target the parent’s own conduct, such as authorising, directing, knowingly facilitating, condoning or controlling the relevant operational decisions, or breaching a specifically defined statutory prevention duty. A clear statutory test for parent-company participation would reduce both evasion and arbitrary liability.

The law should also address the real operational chain: actual land operators, concession holders, contractors, subcontractors, financiers and purchasing entities. The level of liability should reflect their respective control, knowledge, contribution and duties. Directors and managers should be liable only where the statutory elements tying them to the relevant conduct are established; corporate title alone should not suffice. At the same time, outsourcing or use of a thinly capitalised subsidiary should not necessarily absolve a company that directed or knowingly tolerated unlawful conduct.

10.3 Land maps, evidence, service and foreign judgments

An enforcement framework needs authoritative, updated concession and parcel maps, a reliable method for identifying the operating entity, and a process for recording overlapping or disputed rights. It should establish minimum standards for satellite and meteorological evidence, chain of custody, expert independence, translations and authenticated foreign records. Corporate entities that are subject to Malaysian jurisdiction should be required to preserve specified records relevant to fire incidents and comply with properly issued disclosure notices, with penalties for deliberate destruction or material falsification.

The Act should separately prescribe service of notices and court documents on foreign defendants, the means for participation by remote or local counsel, and the conditions for urgent preventive measures. A Malaysian judgment does not automatically attach to property in another state. The government should consider enforceability at the start of litigation, including whether relevant assets are available in Malaysia, whether foreign law permits recognition of the judgment, or whether parallel proceedings or a mutual assistance request would be required.³

Foreign states and state-owned entities may raise different issues of immunity and public authority. A private company should not be equated automatically with the state where it operates, and the Act should not assume that a private claim may proceed against a foreign government without a separate legal basis. This is another reason to seek specific legal advice and diplomatic engagement during drafting.

11. Civil asset forfeiture and lessons from 1MDB
Civil asset forfeiture should be considered as a separate tool within the proposed enforcement framework. The US Department of Justice’s 2016 1MDB-related complaints sought property allegedly purchased with or traceable to misappropriated funds. In June 2024, the DOJ reported that approximately US$1.4 billion had been repatriated to Malaysia through its asset-recovery efforts. In May 2026, the DOJ announced an additional civil forfeiture order involving a New York apartment and certain rental proceeds, in a case seeking over US$6 million. These actions illustrate that asset-recovery proceedings can extend over years and can target property linked to alleged unlawful proceeds. They do not establish that all assets originally targeted were already forfeited or that civil forfeiture itself provides compensation to every person harmed.²⁸˒²⁹˒³⁰

The analogy for haze is to permit lawful preservation and forfeiture of property that satisfies a clearly defined statutory connection to specified serious environmental offences: proceeds of crime, property traceable to such proceeds, or instrumentalities where the law authorises this and the connection is proportionate. Freezing orders must have evidence-based statutory thresholds and judicial supervision. The law should protect innocent owners, legitimate secured creditors and third parties, provide a meaningful opportunity to contest forfeiture, and avoid confiscation based solely on ownership of a company whose land was near a fire.²⁷
Malaysia already has non-conviction-based forfeiture mechanisms in defined circumstances under AMLA section 56 and related provisions in anti-corruption law. The correct first step is to map those powers against the proposed environmental offences, identify what property can be frozen and forfeited, and confirm the applicable burden of proof and procedural protections. Only genuine gaps should be filled through amendments or a new mechanism.²⁵˒²⁶

Forfeiture and victim compensation should remain legally distinct. A forfeiture judgment recovers property for the state or according to the governing legal regime; it does not automatically give an individual an enforceable right to lifelong care. If Malaysia wishes to allocate some recovered assets to a Haze Health Compensation Fund or to restitution for identifiable victims, the legislation should expressly authorise the disposition, set transparent priorities and prevent double recovery. The 1MDB example is therefore an asset-recovery model, not a ready-made personal-injury compensation system.

12. How the proposed Malaysian Act should be designed

12.1 Purpose, definitions and jurisdiction

A dedicated Act or coordinated statutory package should define “haze pollution”, “qualifying transboundary pollution”, “serious environmental offence”, “owner or occupier”, “operator”, “parent or controlling entity”, “beneficial owner”, “fire incident” and “compensable injury”. Definitions should align with measured pollutants, recognised monitoring and scientific uncertainty. The statute should state when overseas conduct is covered and require a material causal connection to pollution or injury in Malaysia. It should be source-neutral: the Act should apply to any qualifying conduct abroad, not name a particular state or nationality.

The Act should contain distinct routes for criminal, civil and administrative liability. A criminal offence could target intentionally or knowingly causing or facilitating unlawful burning, or serious reckless conduct that meets a specified statutory test. A civil duty could support preventive relief and compensation for proven injury without a criminal conviction. Administrative duties could require high-risk operators to maintain prevention plans, disclose incidents, preserve records and cooperate with inspections. Each route should specify its own elements, standard of proof, defences and remedies.

12.2 Corporate and individual liability

Corporate liability should address conduct committed for the entity’s benefit or under its direction, and failures to discharge explicit duties to prevent or respond to fires where the law establishes those duties. Parent-company liability should depend on relevant control, direction, participation, knowledge or statutory responsibility—not share ownership alone. The Act should identify how employee, contractor and subsidiary conduct is attributed, and how a company may demonstrate that it complied with defined prevention obligations where such a defence is intended.
Individual liability should extend to natural persons who personally commit, direct, authorise, knowingly facilitate or otherwise satisfy the elements of a defined offence. It should not impose criminal guilt solely because someone is a director, shareholder, government official or landholder. The statute must state required mental elements clearly and preserve normal criminal safeguards. Deliberate destruction of records, material false statements and obstruction could be separately punishable where their elements are precisely defined.

12.3 Prevention and urgent orders

The law should permit the regulator to issue a preventive notice requiring a qualifying entity to take specified steps to prevent, reduce or control haze pollution. For urgent threats, a court could issue an interim order on evidence of a real risk of serious harm, subject to short return dates, reasons, proportionality and a right to challenge. The Act should permit compliance orders, restoration obligations, monitoring and appropriately tailored permit consequences after a lawful finding. It should not authorise punitive restrictions simply because a foreign company is politically unpopular or because haze happens to occur during a dry season.

12.4 Scientific evidence and a national Haze Evidence Protocol

Malaysia should adopt a protocol binding on relevant agencies for the collection, validation, storage and presentation of haze evidence. It should specify how to record the time and location of hotspots, confirm fires on the ground where feasible, map concession boundaries, archive API and PM measurements, model smoke movement, disclose data quality and uncertainty, and link events to corporate and contractor records. The protocol should distinguish at least three separate scientific questions: (a) where emissions originated and how they travelled; (b) whether anthropogenic climate change altered the probability or severity of relevant drought or fire-weather conditions; and (c) whether a particular person’s disease or economic loss is causally attributable to the exposure. These questions can inform one another but are not interchangeable. Satellite detection, official maps, atmospheric models and climate-event attribution should be admissible subject to reliability and rebuttal principles; no single data stream should be treated as conclusive proof of company liability.

The 2025 PM₁₀ forecasting and WRF-CMAQ studies support investment in model improvement and early warnings. They also support creating a technically independent expert pool able to explain why a model supports or fails to support a particular attribution.⁹˒¹⁰ The national evidence protocol should be developed with universities and scientific bodies, including the Academy of Sciences Malaysia, and periodically reviewed as sensor and modelling methods improve.

12.5 Civil compensation, fund, asset recovery and safeguards

The Act should define the recoverable heads of damages and expressly include reasonable future medical care and lifelong personal assistance where the evidence supports them. It should address delayed diagnosis, limitation periods, the role of medical experts, representative proceedings where appropriate, legal aid and the possible availability of structured payments. A compensation fund should be considered only after a funding and claims model is costed and its relationship to public healthcare, individual actions and insurer obligations is defined.

The asset-recovery provisions should cross-reference AMLA and anti-corruption law rather than duplicate them blindly. If necessary, the Second Schedule or relevant definitions should be amended to make a specified serious environmental offence a qualifying predicate offence. Freezing and forfeiture must have a defined evidential basis, an independent judicial decision, notice and hearing protections where feasible, an innocent-owner defence, proportionate measures and clear accounting for recovered property. A published annual report should explain sums frozen, forfeited, repatriated, allocated to restoration or paid in compensation.

12.6 Climate attribution, adaptive governance and ecosystem-scale evidence

The five proposed frameworks add useful depth to the proposed Haze Evidence Protocol, but they differ materially in readiness. Probabilistic event attribution and adaptive fire-risk monitoring can support evidence and prevention now if their limits are made explicit. A One Health approach can broaden monitoring beyond hospital admissions. The social cost of carbon may support a future, expressly authorised method for valuing climate-related harm, but it should not be treated as an existing automatic head of Malaysian civil damages. Earth System Law is a normative framework for integrated governance, not a presently binding source of regional strict liability or a rule that converts Southeast Asian peatlands into global commons.³⁶˒³⁷˒³⁸˒³⁹˒⁴⁰˒⁴¹

12.6.1 Probabilistic event attribution: valuable context, not proof of corporate fault

Probabilistic event attribution (PEA) estimates how human-induced climate change has altered the probability or intensity of a defined weather or climate event by comparing a factual climate with a counterfactual climate without the relevant anthropogenic forcing. The method is useful for questions such as whether climate change made a drought or extreme fire-weather conditions more likely. It is conceptually different from WRF-CMAQ or other chemical-transport and source-apportionment methods, which estimate how emissions from particular areas or sources affect pollutant concentrations downwind. Nor is either method the same as individual medical causation.³⁶˒³⁷

Accordingly, PEA cannot by itself calculate what share of a particular fire was “caused by corporate negligence”, nor does it identify who ignited the fire. The fire may reflect the interaction of ignition, land management, drainage, peat moisture, wind, rainfall deficits, ENSO variability and anthropogenic climate change. These contributors are not necessarily separable into legally meaningful percentage shares using PEA alone. An attribution result may, however, provide relevant context for foreseeability and the expected standard of fire prevention where drought and drying peatlands were reasonably foreseeable risks. Climate-influenced weather should not automatically defeat a claim as an “act of God”; neither should the existence of climate change automatically establish a defendant’s liability. The applicable statutory duty, breach, source connection, causal test and any apportionment rule must still be proved under the governing law.

The practical reform is to require expert reports to state separately (i) source and transport attribution, (ii) climate-event attribution where a robust study is available, and (iii) the legal and medical causal propositions the evidence can or cannot support. Reports should disclose model resolution, event definitions, baseline and counterfactual choices, uncertainty intervals, sensitivity tests, and limitations. Courts should be able to consider robust PEA evidence alongside fire-scene evidence and land-management records, but should not be required to accept a climate-attribution study as conclusive evidence of fault or damages.³⁶˒³⁷

12.6.2 Adaptive governance and dynamic prevention triggers

Adaptive governance supports institutions that learn from monitoring, coordinate across levels of government and revise interventions in light of new information.³⁸ It is a good fit for fire prevention because the hazard varies across sites and seasons. A Malaysian review published in 2026 synthesises evidence that peat-fire risk rises sharply as peat moisture declines and groundwater tables fall, and identifies hydrological restoration, monitoring, community participation and improved detection as relevant prevention measures.⁴²
The statute should set the legal authority, purpose, safeguards, review duties and outer limits for risk-based restrictions. The detailed operational triggers should normally sit in publicly available regulations, codes or technical schedules that can be updated after scientific review, rather than hard-coding one universal API number, soil-moisture value or El Niño index into primary legislation. Localised soil moisture, groundwater levels, rainfall deficit, vegetation dryness, fire-danger forecasts, wind and smoke-transport forecasts should be considered together where data quality permits. El Niño forecasts are relevant context but are probabilistic and do not translate uniformly into local fire risk; an ENSO index alone should not automatically trigger a region-wide land-clearing moratorium.

A defensible adaptive system would use graduated and transparent stages—for example, watch, heightened readiness, temporary activity restrictions and stand-down—with defined evidence thresholds, geographical scope, time limits, review intervals and routes to challenge errors. Triggers should be calibrated for different peat types and local conditions, independently evaluated, and accompanied by public reasons and data-quality statements. This design protects against both regulatory obsolescence and arbitrary restrictions. The objective is not to make every warning legally binding, but to ensure that high-risk operators take proportionate precautions before fires become difficult to contain.³⁸˒⁴²

12.6.3 Integrated assessment models and the social cost of carbon

Integrated assessment models (IAMs) combine representations of the economy, emissions and the climate system to estimate climate-related economic effects. The social cost of carbon (SCC) is generally an estimate of the discounted marginal damage associated with an additional tonne of carbon dioxide emissions, under the assumptions of a particular model. Nordhaus’s DICE-2013R paper illustrates both the policy use of the SCC and the dependence of estimates on model structure, damages, assumptions and discounting.³⁹

An SCC-based measure could be considered for a future statutory claim by the state for defined climate-related environmental damage, or as one input to a prescribed environmental-damage assessment. It is not a direct estimate of all harm from a peatland fire and is not automatically a legally recoverable civil-damages head in Malaysia. Application would require reliable estimates of the additional fire-related greenhouse-gas emissions, a defensible baseline, treatment of CO₂ and non-CO₂ gases, an identified SCC methodology, transparent discounting assumptions, and a statute expressly authorising the relevant claim or charge. A model-derived monetary value should not be presented as a precise measurement of the damage from one fire.

There is also a risk of double counting if an SCC-based amount overlaps with peatland restoration costs, carbon-credit accounting, environmental liabilities, ecosystem-service losses or other climate charges. Nor should an SCC award be added to individual personal-injury damages without a coherent legal basis and allocation method. The near-term priority is to improve fire-emissions inventories, estimate carbon released using published and locally relevant methods, and document rehabilitation costs. Malaysia could then commission an independent review of whether an updated SCC range is suitable for a narrowly defined statutory climate-damage remedy, with periodic review and explicit rules preventing double recovery.³⁹˒⁴²

12.6.4 One Health and a wider environmental evidence baseline

The One Health approach recognises the interdependence of human, animal, plant and ecosystem health and calls for coordinated work across relevant disciplines and agencies.⁴⁰˒⁴³ It is therefore appropriate to broaden haze monitoring beyond human respiratory admissions. A proportionate Haze Evidence Protocol could include crop damage and yields, livestock health where credible clinical evidence exists, documented wildlife mortality, fire-perimeter overlap with important habitat, vegetation loss, peat depth or soil damage, water quality, restoration requirements and ecosystem services where these can be assessed reliably.
These data serve different legal functions and should not be conflated. Human hospital admissions may support population-level health assessment; crop-yield evidence may support a farmer’s property or economic-loss claim; wildlife mortality, habitat loss and peat damage may support ecological restoration or a state claim if the law authorises it.

The One Health label does not itself create a right to compensation or prove causation. Each claim still requires an appropriate baseline, an established damage metric, temporal and spatial linkage to the fire or smoke, consideration of alternative causes, and proof to the standard required by the applicable procedure.

To avoid making evidence collection impractical, the protocol should scale by incident severity and potential impact. A minor local fire need not trigger a full biodiversity survey. A major or repeated fire in peatland or protected habitat could trigger a pre-defined expanded environmental assessment involving environment, health, agriculture, veterinary, forestry and wildlife agencies. Data should have documented methods, sampling uncertainty, chain of custody and clear separation between measured observations, modelled estimates and assumptions.⁴⁰˒⁴²˒⁴³

12.6.5 Earth System Law: a long-term governance lens, not current binding liability

Earth System Law is a scholarly framework that argues environmental law should better reflect interconnected Earth-system processes, ecological limits and the fragmentation of existing governance.⁴¹ It can support a broader policy case for treating peatland carbon storage, hydrology, biodiversity and transboundary air pollution as interconnected concerns. However, it is a conceptual and normative framework; it does not itself create a binding offence, a civil cause of action, strict liability or jurisdiction over another ASEAN state.
The proposition that Equatorial Asian peatlands should be treated as “global commons” must be handled especially carefully. Their wider climate and biodiversity significance does not, under current law, remove the sovereignty or territorial jurisdiction of Indonesia, Malaysia or other states over peatlands within their territory. Nor should the essay assert that a particular fire crosses a planetary tipping point unless a defined scientific assessment supports that specific claim. Earth System Law can inform the direction of reform, but should not be represented as an existing legal rule.

Practical steps consistent with this broader perspective include domestic restoration plans for degraded peatlands, risk-based restoration bonds or financial assurance for designated high-risk operators, improved protection of high-value peat areas, long-term monitoring of hydrology and carbon stocks, and ASEAN agreements for compatible data, fire investigation and restoration standards. Domestic bonds or strict-liability provisions would require a clear statutory basis and proportionate rules. A regional strict-liability regime would require negotiation and state consent through an ASEAN legal instrument, including agreement on covered conduct, causation, defences, allocation of costs, dispute resolution and enforcement.⁷˒⁴¹˒⁴²

13. Country-specific response

13.1 Malaysia

Malaysia should enforce its own no-open-burning rules and prevent fires at home as a matter of credibility and public health. It should integrate the EQA, fire and forestry administration, health agencies, financial investigators and prosecutors through a standing haze task force with clear lead-agency responsibilities. Because land and forestry administration involves state-level interests, the federal framework should be developed with state governments, including Sabah and Sarawak, and should avoid assuming that federal environmental legislation automatically resolves every jurisdictional question.

Malaysia should improve peatland water management and rehabilitation, support alternatives to burning, prevent fires in high-risk sites and adopt a transparent API-based public response system. These measures align with the Academy of Sciences Malaysia’s earlier recommendations and the 2026 ASMC outlook warning of dry conditions and elevated regional risk.⁸˒¹³

13.2 Indonesia

Indonesia is central to managing fires on its territory and has domestic laws, enforcement institutions and peat restoration responsibilities. Malaysia should seek practical cooperation on concession maps, on-the-ground verification, fire suppression, prosecutions and corporate information. The objective should be specific evidence and prevention outcomes rather than public accusations that do not differentiate between a fire occurrence, a legal violation and a proven responsible party. Regional assistance should include technical capacity, peatland hydrology and support for lawful alternatives to burning.

13.3 Singapore

Singapore provides the principal statutory comparator. Malaysia should study the THPA’s extraterritorial scope, civil duties, preventive notices and presumptions, but also the research identifying foreign-evidence, land-map and judgment-enforcement challenges.¹˒²˒³ Bilateral cooperation could include compatible evidence formats, expert exchanges and procedures for requests related to Malaysian-linked corporate groups and fires affecting both states.

13.4 Thailand and the Mekong sub-region

Thailand’s policy response should reflect the northern Mekong’s seasonal fire and agricultural-residue problems, which are not always caused by the same source pattern as southern ASEAN peatland haze. It should strengthen early warning, local burn prevention, alternatives to residue burning, enforcement against unlawful fires and cross-border science cooperation with neighbouring Mekong countries. The ASMC’s October 2026 outlook indicates that the northern and southern ASEAN sub-regions have different seasonal conditions; policy should respond to the relevant local drivers rather than assume one regional mechanism explains every haze episode.⁸

14. Implementation roadmap and low-hanging fruit
The most credible programme proceeds in parallel on immediate operations and medium-term legislation. The following sequence focuses on deliverability, not the number or severity of offences enacted.

Phase I: Immediate operational changes
In the first six months, the government should publish one public haze dashboard integrating API readings, fire and hotspot information, official alerts, school and outdoor-activity thresholds, and a plain-language explanation of data limitations. Agencies should use a single incident identifier; preserve source data and records; adopt one case-allocation protocol; and pre-agree requests for evidence from Indonesian and other authorities. The DOE’s current air function already includes implementation of the National Haze Action Plan, air monitoring, fire prevention and peatland-management programmes; the immediate task is to improve coordination and public reporting rather than assume all such structures must be created anew.⁷

Malaysia should issue a short evidentiary protocol stating that a hotspot is a lead, not proof; standardise how officers photograph, geolocate and archive fire evidence; map active concessions and beneficial ownership where lawful; and publish annual enforcement results. Public-health thresholds should be rehearsed before the dry season, with alerts to schools, healthcare providers, vulnerable communities and outdoor employers. These measures are feasible without waiting for a new transboundary statute.

Phase II: Legal audit and bill drafting

The next step is a cross-government legal audit of the EQA, AMLA, MACC Act, companies and insolvency laws, civil procedure, limitation periods, land and forestry law, international assistance arrangements and available civil remedies. The audit should identify overlaps, missing powers and constitutional questions. A drafting group should then publish a policy paper with options for a dedicated Act versus amendments to existing legislation, clearly setting out scope, required Malaysian connection, corporate liability, burden of proof, defences, remedies, funding and safeguards.

Phase III: Core legislation and resourcing

If a dedicated Act is chosen, it should be accompanied by trained environmental investigators, scientific experts and prosecutors; a budget for evidence preservation and cross-border requests; and clear assignment of the lead agency. The statute should include review and reporting duties. A law whose offences cannot be investigated or whose judgments cannot be enforced will have limited practical effect, regardless of its nominal penalties.

Phase IV: Compensation and financial recovery
The government should separately cost the health fund proposal, identify expected claim types and controls against fraud, and decide whether to use public budget funding, risk-based levies, insurance or financial assurance. An asset-recovery plan should trace proceeds and property only where the statutory and evidentiary requirements are met. The 1MDB example confirms that cross-border asset recovery can return funds to Malaysia, but it also shows that such recovery is complex and time-consuming.²⁸˒²⁹˒³⁰

Phase V: Public evaluation
An independent review should be completed three years after commencement and regularly thereafter. Evaluation should focus on response time, quality of source attribution, fires prevented, repeat offending, cases resolved, compensation paid, care delivered, costs recovered, restoration completed and evidence of reduced exposure. It should also identify failed or abandoned cases and explain whether the obstacle was lack of jurisdiction, insufficient evidence, unavailable foreign records, proportionality, inability to locate assets or another reason. Counting notices or increasing maximum fines is not, on its own, evidence of effectiveness.

15. Conclusion
Malaysia has a sound basis for considering a more explicit transboundary-haze law. Scientific evidence demonstrates that haze is a real public-health and environmental concern, while the latest Malaysia-specific studies show that improved PM forecasting and meteorological/fire-emission modelling are possible and valuable. At the same time, the studies illustrate that source attribution and individual causation require careful analysis. The October 2026 conditions reinforce the need for prevention and public-health preparedness, but the law should not treat a regional haze episode as conclusive proof against any specific person or company.⁸˒⁹˒¹⁰˒¹¹˒¹⁴

Singapore’s THPA is an important model for extraterritorial reach, entity management liability, prevention orders, civil duties and presumptions. Its limitations, identified by the supplied Tan paper and later comparative scholarship, are equally instructive: legal powers do not eliminate foreign evidence barriers, disputed land rights, choice-of-law questions or problems enforcing judgments abroad.¹˒²˒³ Malaysia should adapt the useful provisions and build the enforcement infrastructure around them.

The proposed framework should integrate clearly defined serious environmental crimes, civil compensation for medically attributable injuries, access to interim treatment, transparent corporate and concession records, specialised investigations, and targeted asset recovery. EU environmental-crime law and US financial-enforcement tools provide lessons but should be adapted to Malaysian jurisdiction and due-process safeguards. The 1MDB asset-recovery experience shows how property linked to unlawful proceeds may be recovered and repatriated; it does not mean forfeiture itself compensates haze victims.²⁷˒²⁸˒²⁹˒³⁰

The additional climate-governance frameworks should be adopted selectively. Near-term improvements include separating smoke-source attribution from climate-event attribution, using locally validated peat-moisture and groundwater indicators in adaptive prevention protocols, and extending incident assessments to credible crop, animal and ecosystem evidence. SCC-based climate damages require additional methodological work and explicit statutory authority; Earth System Law is best used as a longer-term guide to coordinated ASEAN and ecosystem-based governance, not as a claim that current law already imposes regional strict liability or treats peatlands as global commons.³⁶˒³⁷˒³⁸˒³⁹˒⁴⁰˒⁴¹˒⁴²˒⁴³

The most defensible approach is therefore a combination of immediate low-cost operational reforms, a targeted statute and sustained ASEAN cooperation. The objective should be enforceable accountability and measurable reduction in exposure, not a claim that a single new Act will end haze. The test of success is whether Malaysia can prevent fires, identify legally responsible conduct with reliable evidence, protect affected people, deliver proportionate remedies and cooperate effectively across borders.

Appendix A. Ranked implementation checklist: 50 practical reforms

The following ranking is a qualitative implementation order based on likely utility, feasibility and urgency, not a quantified cost-benefit analysis.

1. Publish an integrated public haze dashboard that shows API, official alerts and relevant hotspot information with time stamps.
2. Issue one inter-agency response protocol identifying the lead agency and each supporting agency.
3. Standardise fire-scene, satellite-data and documentary evidence-preservation procedures.
4. Formally state in operational guidance that a satellite hotspot is an investigative lead, not proof of liability.
5. Build a maintained geospatial link between verified fire locations, parcels, concessions and known operators.
6. Create procedures to preserve company, contractor and land-management records as soon as a relevant fire is detected.
7. Pre-agree public-health action thresholds for schools, healthcare settings and outdoor activities.
8. Publish annual enforcement statistics, including investigations, charges, case outcomes, civil claims and recoveries.
9. Ensure the amended section 29A open-burning penalties and guidance are reflected accurately across government pages.
10. Create standard templates for requests to neighbouring states for land maps, fire records and other evidence.
11. Provide a public complaint channel with acknowledgement, status updates and protection against retaliation where applicable.
12. Conduct an annual pre-dry-season haze-readiness exercise involving health, environment, education and emergency agencies.
13. Create an express statutory civil cause of action for qualifying personal injury caused by transboundary haze.
14. Expressly recognise future medical treatment, rehabilitation and lifelong personal care where medically supported.
15. Provide a tailored limitation rule for delayed diagnosis and latent disease while retaining fair legal certainty.
16. Cost and design a possible interim Haze Health Compensation Fund with transparent eligibility and review rights.
17. Provide legal aid and consider representative procedures for claimants with common issues, without assuming identical individual damages.
18. Publish a standard for medical, atmospheric and source-attribution evidence in individual compensation cases, distinguishing source attribution, climate-event attribution and individual injury causation.
19. Provide court-supervised disclosure for specified fire-prevention, operational and concession records.
20. Define parent-company liability according to relevant control, direction, participation, knowledge or a clear statutory duty.
21. Define graduated environmental offences by seriousness, fault and foreseeable harm.
22. Assess corporate penalties linked to unlawful gain or financial capacity for specified serious offences.
23. Authorise recovery of legally recoverable emergency response, clean-up and restoration costs; consider climate-damage valuation only if expressly authorised, independently assessed and protected against double counting.
24. Evaluate whether periodic or structured payment of future care damages should be expressly authorised.
25. Develop a damages guide with medical, actuarial and rehabilitation expertise, without making awards automatic.
26. Build a referral protocol for environmental cases that show evidence of bribery, fraud or criminal proceeds.
27. Review AMLA and related schedules to determine whether specified new environmental crimes should be qualifying predicate offences.
28. Improve beneficial-ownership disclosure and make verified concession information accessible to competent authorities.
29. Pilot risk-based due diligence and traceability requirements for specified high-risk commodities and operators.
30. Require suitable fire-prevention plans and incident reporting for designated high-risk operations.
31. Assess targeted insurance, bonds or other financial assurance for high-risk operators rather than a blanket requirement.
32. Prioritise peatland water management, fire breaks, rehabilitation and response capacity in at-risk sites, using locally validated soil-moisture, groundwater and drought indicators in an adaptive trigger system.
33. Fund no-burn alternatives and transition assistance for smallholders where evidence shows they reduce fire risk.
34. Formalise participation of state governments and address land and forestry administration, including Sabah and Sarawak.
35. Define overseas conduct and Malaysian connecting factors for jurisdiction over foreign individuals and companies.
36. Prepare service-of-process, mutual legal assistance and cross-border evidence protocols before a crisis occurs.
37. Draft recognition, enforcement and asset-location strategies for judgments involving foreign defendants.
38. Provide due-process safeguards, clear defences and proportionate thresholds for criminal presumptions and preventive orders.
39. Allow carefully defined permit, procurement or grant consequences only after specified legal findings and fair procedures.
40. Develop privacy-protected surveillance of human health and, where proportionate and feasible, crop, animal, wildlife and ecosystem impacts under a One Health-informed evidence protocol.
41. Prevent double recovery and establish an independent governance and audit framework for any fund.
42. Enable urgent interim relief subject to judicial oversight and a timely opportunity to challenge the order.
43. Address protections for outdoor workers and other groups with high unavoidable exposure.
44. Publish modelling methods, calibration and uncertainty when source attribution is released, and report climate-event attribution separately where scientifically robust evidence is available.
45. Improve the timeliness and clarity of investigation notices and public updates without prejudicing proceedings.
46. Provide multilingual, accessible information about health protection and the steps for making a claim.
47. Review barriers involving insurance, legal costs and evidence access for injured individuals.
48. Apply secure long-term data retention, access controls and audit trails to enforcement evidence.
49. Require an independent review of the Act three years after commencement and periodically thereafter, including the performance of dynamic thresholds, climate-attribution evidence and environmental-damage valuation methods.
50. Avoid claiming success merely from maximum penalties, notices or investigations; measure prevention, outcomes and compensation paid.

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29. U.S. Department of Justice. (2024, June 13). Justice Department repatriates $1.4B misappropriated 1MDB funds to Malaysia. https://www.justice.gov/archives/opa/pr/justice-department-repatriates-14b-misappropriated-1mdb-funds-malaysia
30. U.S. Department of Justice. (2026, May 27). Justice Department recovers over $6M in additional funds linked to 1MDB scheme. https://www.justice.gov/opa/pr/justice-department-recovers-over-6m-additional-funds-linked-1mdb-scheme
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Thursday, October 15, 2026

From Platform Flexibility to Fair Work: What Malaysia Should Adopt from China and Other Countries.

Introduction: Flexibility should not mean financial insecurity

Digital platforms have transformed how Malaysians earn a living. E-hailing drivers, food-delivery riders, couriers and other gig workers can choose when to work, supplement their income and access customers through digital technology. These benefits matter, particularly in a labour market where flexibility and alternative income opportunities are valuable.

However, flexibility does not automatically translate into economic security. A worker may be free to log in and out of an application yet have limited influence over remuneration, task allocation, performance ratings, incentive rules or account suspension. The platform's technology can therefore become a powerful mechanism for determining the practical terms of work.

Malaysia has already taken an important legislative step through the Gig Workers Act 2025 (Act 872), which became operational on 31 March 2026. The Act establishes rights concerning contractual terms, earnings, automated monitoring and decision-making, deactivation, social security, occupational safety and dispute resolution. It also creates a Gig Workers Consultative Council and a Gig Workers Tribunal.¹,²

The policy challenge has consequently changed. Malaysia no longer needs to begin by designing an entirely new legal framework. It needs to ensure that existing rights are effective, address gaps in the coverage and detail of the current law, and learn from international approaches that have tested ways to make platform work fairer.

China's proposed labour-protection measures, Singapore's enacted platform-worker legislation, Australia's minimum-standards framework, the European Union's Platform Work Directive and emerging International Labour Organization standards offer different kinds of lessons. They should not be treated as equivalent: some are binding laws, some are proposals or announced measures, and some are international or empirical reference points.

Malaysia could also consider a dedicated Gig Worker Protection and Transition Fund, financed partly by larger platform operators. The recent decision to establish a Postal Service Fund using the institutional model of Malaysia's telecommunications Universal Service Provision (USP) Fund provides a relevant example of how a sector-specific funding mechanism can support a defined public-policy objective.¹⁵,¹⁶

The objective should be clear: preserve the legitimate flexibility of platform work while ensuring that workers receive fair treatment, meaningful social protection, accountable algorithmic management and a reasonable ability to challenge decisions affecting their livelihoods.

1. Malaysia has established a legal foundation, but implementation matters

Act 872 establishes a statutory framework specifically for gig workers. It requires service agreements to specify matters including the services to be provided, the parties' obligations, earnings rates and payment arrangements. Workers must be informed of the agreed rate before undertaking a service and consulted and informed when the contractual terms change. The Act also prohibits discrimination in working conditions, service assignment and payment of earnings.¹

For platform workers, section 8(2) requires information about automated monitoring and decision-making systems and provides for a non-automated review mechanism. Section 14 establishes procedures concerning deactivation, including an inquiry process and remedies where a suspension or modification is found unjustified. The Act also recognises gig workers' rights to form, join and participate in associations.

Dispute resolution is another important improvement. The framework provides for internal grievance mechanisms, conciliation and a specialist tribunal. Parts VIII and IX address social security and occupational safety and health, respectively.¹,²

These provisions should not be understated. Malaysia already has several protections that policymakers might otherwise propose borrowing from foreign jurisdictions.

Nevertheless, a statutory right is only as useful as the process through which a worker can exercise it. A formal right to review an automated decision may offer little practical protection if the worker cannot understand the reasons for the decision, obtain the relevant records or secure a timely reconsideration by someone with authority to correct an error.

The same principle applies to earnings. A contractual right to know the agreed rate is valuable, but it does not necessarily explain how incentives, waiting time, cancellations, deductions or changes in platform pricing affect the worker's final remuneration.

Malaysia should therefore concentrate on making existing rights measurable, accessible and enforceable before adding overlapping obligations. The measures proposed below are recommendations, not descriptions of current Malaysian law unless expressly identified as such.

2. Malaysian research shows why further protection is justified

Policy reform should be grounded in evidence from Malaysia rather than assumptions drawn entirely from foreign markets.

Mohd Daud, Osman, Samsudin and Phang (2024) examined financial resilience among 452 Malaysian gig workers using survey data collected between June and November 2022. Their study found low resilience against adverse financial shocks, with income, age and financial literacy among the relevant determinants. The authors highlighted the need for better-targeted financial education, income support and regulatory protection.⁵

The study does not establish that every gig worker experiences financial hardship, nor does it provide a current census of the gig workforce. It nevertheless provides empirical evidence of an important policy question: how can workers manage income volatility and build financial security when their earnings and access to work may fluctuate?

Occupational health is another concern. Daud and colleagues (2025) studied 191 food-delivery riders in Eastern Peninsular Malaysia. The cross-sectional study reported work-related musculoskeletal disorders among 74.9% of the participants and identified associations with factors including working days, vibration exposure and exercise habits.⁶ These findings relate to a particular sample and should not be interpreted as a national prevalence estimate.

The results nevertheless support targeted preventive measures for delivery workers, whose work exposes them to physical demands and road-safety risks.

Malaysia's platform-worker disputes provide further evidence of the issues workers consider important. Uchiyama, Furuoka and Omar (2025) analysed food-delivery boycotts in 2022 and 2024, examining worker resistance, organising and the relationship between platforms and riders.⁷ This research illustrates that disputes over earnings, working arrangements and collective voice are established features of Malaysia's platform economy.

Together, these studies support further action on income security, occupational safety and worker representation. They do not justify claiming that all platform work is exploitative or that every platform uses unfair algorithms. Effective regulation must distinguish documented risks from allegations that require further investigation.

3. Algorithmic fairness: the next major regulatory challenge

One of the most important issues for Malaysia is the growing influence of algorithmic management.

Platforms use automated systems to match customers and workers, calculate or present earnings, monitor performance, allocate incentives and identify possible misconduct. Some decisions may be routine and beneficial. Others can materially affect a worker's income or ability to continue working.

The difficulty arises when the platform has detailed information about the system's operation while the worker sees only an offer, score, penalty or suspension. This creates an information imbalance that can make it difficult to identify errors or challenge unjustified decisions.

International research demonstrates why this deserves attention. Binns et al. (2025), in a peer-reviewed study published in the proceedings of the ACM Conference on Fairness, Accountability, and Transparency, analysed approximately 1.5 million Uber trips involving 258 drivers in the United Kingdom. Their longitudinal research reported that following the introduction of dynamic pricing, driver pay decreased, the platform's share increased, job allocation and pay became less predictable, inequality between drivers increased, and drivers spent more time waiting for jobs.⁸

The Guardian's June 2025 reporting also described a separate US analysis associated with Columbia Business School that raised concerns about the relationship between upfront pricing, passenger fares, driver payments and the platform's retained share of revenue. Uber disputed the interpretation and maintained that its pricing was designed to be transparent and fair.⁹

These findings should not be directly extrapolated to Malaysia. The studies concern Uber in other markets, with different operating conditions and regulatory arrangements. They do, however, demonstrate that changes in platform pricing and allocation systems can have consequences that are difficult to detect from individual transactions alone.

Algorithmic pricing is not inherently unfair. Opaque, arbitrary or discriminatory decision-making is the more appropriate regulatory target.

Malaysia should strengthen its existing framework in five ways.

First, platforms should provide understandable explanations of the principal factors affecting remuneration, incentive eligibility and significant adverse decisions. Workers do not need unrestricted access to source code, but they should be able to understand the material rules that influence their earnings.

Second, workers should receive itemised earnings statements automatically at appropriate settlement intervals. Section 13 of Act 872 provides a right to request an earnings slip from a qualifying contracting entity. Making detailed statements routine would help workers verify their payments and provide evidence in disputes.

Third, human review must be meaningful. Where a significant automated decision suspends an account or materially affects access to work, the reviewer should have sufficient information and authority to reverse the decision. Workers should receive reasons, access to relevant evidence and a clear appeal process.

Fourth, material changes to remuneration formulas, incentives and allocation rules should be accompanied by appropriate advance notice and consultation. Section 8 already addresses variations to service-agreement terms; further guidance should clarify when an algorithmic or incentive change is sufficiently material to require this process.¹

Finally, Malaysia should introduce risk-based algorithmic audits. These should examine changes in net earnings, waiting time, payout calculations, task allocation, deactivation and appeal outcomes. The purpose is not to assume wrongdoing, but to identify patterns that individual complaints cannot reveal.

The regulator should be able to inspect relevant records confidentially, while public reporting uses aggregated data and safeguards personal information and legitimate commercial secrets.

4. What Malaysia can learn from China's proposed framework

On 8 October 2026, China's Ministry of Human Resources and Social Security published the draft Measures for Protecting the Rights and Interests of Workers in New Forms of Employment for public consultation until 8 November 2026. The official announcement identifies basic labour-rights protection, regulation of labour rules and algorithms, classification of employment arrangements, dispute resolution, supervisory responsibilities and legal liability as central elements of the proposal.¹⁰

The distinction between a draft and an enacted law is essential. As at 15 October 2026, these proposed measures should not be presented as binding Chinese legislation. They represent a proposed regulatory direction, not operative law.

Nevertheless, their policy direction is relevant to Malaysia. China is addressing the challenge of protecting workers who are subject to enterprise labour management but may not satisfy all the criteria for a conventional employment relationship.

Malaysia should adopt three lessons from this approach.

First, legislation should consider how work is actually organised rather than relying exclusively on contractual labels. A person's practical dependence on a platform, the platform's control over remuneration and work allocation, and its disciplinary authority can be relevant to determining what protections should apply.

Second, rules governing labour and algorithmic management should be sufficiently clear to support enforcement. A general obligation to disclose automated systems is a starting point, but it may not be enough to resolve disputes over how a decision was reached.

Third, rights should be accompanied by identifiable enforcement responsibilities and workable dispute-resolution procedures.

Malaysia should not copy China's draft wholesale. The two jurisdictions have different legal systems, administrative arrangements and labour-market institutions. China's proposal is best treated as a source of regulatory ideas whose relevance must be tested against Malaysia's existing Act 872.

5. Lessons from Singapore, Australia and the European Union

Other jurisdictions offer more developed examples of specific mechanisms that Malaysia can adapt. Their legal status differs and should be kept distinct.

Singapore's Platform Workers Act introduced protections from 1 January 2025 covering work injury compensation, Central Provident Fund (CPF) contributions and representation rights. Platform operators are responsible for providing work injury compensation insurance and handling applicable CPF contributions. Higher CPF contribution rates are mandatory for platform workers born on or after 1 January 1995, while older workers may opt in.¹¹

Malaysia can learn from Singapore's approach to ensuring that platform work generates a contribution record and that workers are not left solely responsible for navigating social-protection systems. Its contribution design should, however, reflect Malaysian incomes, institutions and the separate roles of EPF and PERKESO.

Australia offers a different lesson. Its first interim minimum-standards order for qualifying on-demand delivery workers took effect on 17 August 2026. The legally enforceable order includes minimum pay standards, an earnings-floor top-up mechanism, record-keeping requirements, rules concerning vehicle-related expenses and consultation about significant changes.¹²

Malaysia should study the mechanism rather than copy Australia's nominal pay rate. An effective Malaysian earnings standard should be informed by domestic evidence on remuneration, work-related expenses and economically relevant working time. It should also provide clear rules for calculating the shortfall where a qualifying worker's earnings fall below the prescribed floor.

The European Union's Platform Work Directive places particular emphasis on correct employment classification and algorithmic management. It requires Member States to establish effective procedures for determining employment status, using the facts of actual work, including how automated systems organise it. It also provides for a rebuttable presumption of employment where the applicable national criteria indicate direction and control.¹³

As at 15 October 2026, the deadline for Member States to transpose the Directive into national law—2 December 2026—had not yet passed. The Directive should therefore be understood as an adopted EU legislative framework with implementation still due, rather than a uniform set of fully implemented national rules.

Malaysia can adapt the underlying principle: where a platform effectively exercises employer-like control, the legal classification should be assessed on the substance of the relationship. This would not mean that every platform worker must automatically become an employee. It would mean that the law should provide an effective route to determine status where the actual working arrangements justify it.

6. Social protection: strengthen PERKESO and develop platform-funded EPF contributions

Social protection is another area where Malaysia should move beyond reliance on voluntary participation alone.

The Gig Workers Act provides a statutory mechanism for registration and contributions under the Self-Employment Social Security Scheme administered by PERKESO. The implementing social-security regulations specify a contribution deduction rate of 1.25% for the relevant platform transactions, subject to the applicable requirements.¹,² These provisions are an important improvement, but they should not be confused with a separate platform-funded contribution.

Malaysia should consider requiring platform operators to contribute directly towards qualifying workers' PERKESO coverage, with a clear allocation of responsibility and coordination with applicable government matching incentives. This is a recommendation, not a description of an existing general platform-funded contribution obligation.

The Government's Budget 2027 speech announced a matching incentive of 35% for relevant PERKESO contributions, increasing to 50% if platform companies also contribute towards workers' contributions. It also announced a RM160 million package intended to improve net earnings and assist with vehicle maintenance, insurance and social-security contributions from 2027. These are announced measures whose final implementation details should be checked as they are introduced.⁴

Retirement saving requires a complementary approach. EPF's i-Saraan Plus is a voluntary contribution initiative for eligible e-hailing and p-hailing drivers. It provides a government matching incentive of 20% of eligible voluntary contributions, capped at RM600 annually and RM6,000 over a lifetime, subject to its terms and conditions. Platform providers facilitate contributions on behalf of workers, with worker consent.³

Malaysia should consider requiring a compulsory platform-funded EPF contribution for qualifying platform earnings, distinct from the worker's own voluntary saving. One possible starting point for consultation is a contribution equal to 2% of eligible platform remuneration, with a formal review after two years. This is a proposed policy rate, not a rate established as optimal by Malaysian research or current law.

Workers who legally qualify as employees should continue to receive the EPF protections required under ordinary employment law. A lower platform-specific contribution must not become a means of avoiding those obligations.

The Government should also clarify how a new compulsory platform contribution would interact with i-Saraan Plus eligibility. The objective should be to preserve the incentive for eligible workers to make additional voluntary contributions without treating a mandatory platform payment as though it were the worker's own voluntary saving.

7. A proposed Gig Worker Protection and Transition Fund

Beyond individual contributions and platform-specific duties, Malaysia should consider establishing a dedicated Gig Worker Protection and Transition Fund to finance shared services and targeted support that benefit workers across the platform economy.

The proposal draws on a recent Malaysian institutional precedent. On 10 October 2026, the Government announced that it would activate a Postal Service Fund with an initial allocation of RM150 million. Administered by MCMC, the fund is expected to begin operating in the first quarter of 2027 and is intended to support universal postal services, particularly delivery to rural, remote and island communities. The Government said the fund uses the same principle as the telecommunications USP Fund, with relevant provisions already contained in the Postal Services Act 2012.¹⁵

The example is relevant because it demonstrates how a dedicated fund can be organised around a defined statutory purpose. It does not establish that MCMC has the legal authority to levy gig platforms or that the Postal Service Fund itself can finance worker protection. A gig-worker fund would require its own legal basis, contribution rules, governance and spending conditions.

The telecommunications USP Fund provides a second lesson. Established under section 204 of the Communications and Multimedia Act 1998 and administered under the USP Regulations 2002, it requires eligible telecommunications companies with more than RM2 million in relevant annual net revenue to contribute 6% of the determined revenue under the applicable rules.¹⁶,¹⁷ The purpose is to support universal communications access, particularly in underserved areas and among underserved groups.

Malaysia should adapt the principle of pooled sectoral contributions—not copy the 6% telecommunications rate. Telecommunications and gig platforms have different cost structures, revenue models and regulatory objectives. Applying the same percentage to gig platforms without a separate policy analysis would be unjustified.

Why establish a fund?

A dedicated fund could address several needs that are shared across competing platforms. These include independent scrutiny of algorithmic management, preventive occupational-safety programmes, worker access to rights information, targeted support for social-protection contributions and training for workers whose opportunities change as platforms and automation evolve.

The fund should finance additional protections and common services, not replace the legal responsibilities of individual platforms. It must not allow an operator to pay a levy instead of complying with its obligations under Act 872, applicable PERKESO rules or any future EPF contribution requirements.

Nor should it duplicate existing government programmes. Budget 2027 has already announced a RM160 million package, jointly funded by the Government and Grab, to support e-hailing and p-hailing workers from 2027. The new fund should finance only additional eligible activities where there is a clear gap, with the different funding sources disclosed transparently.⁴

Who should contribute?

The fairest starting point would be to require contributions from larger platform operators based on their Malaysian revenue from covered gig services. Smaller operators should receive a meaningful exemption or low threshold so that the regime does not unnecessarily discourage new entry or impose disproportionate administrative costs.

The contribution base should be Malaysia-attributable net platform-service revenue, not the total customer transaction value. Gross merchandise value includes amounts passed through to drivers, riders, merchants and other service providers. Charging directly on that entire amount could create an excessive burden and may encourage platforms to shift costs to workers or consumers.

The rules should define qualifying revenue clearly. Relevant commissions, platform fees and other revenue attributable to covered gig services could be included, with appropriate treatment of refunds, statutory taxes, gratuities and genuine pass-through payments. Related companies should be aggregated where necessary to prevent businesses from splitting their operations merely to avoid the threshold.

A possible starting point for public consultation would exempt the first RM5 million of annual Malaysian covered platform-service revenue. A progressive contribution could then apply to the qualifying portions above the threshold: 1% on the portion up to RM100 million, 1.5% on the portion between RM100 million and RM500 million, and 2% on the portion above RM500 million.

These figures are policy proposals, not existing statutory rates or empirically proven optimal levels. The thresholds and rates should be tested against confidential, auditable platform accounts before legislation is introduced.

A marginal schedule is preferable to applying one percentage to an operator's entire revenue as soon as it crosses a threshold. It avoids a sudden jump in liability and allows the contribution to increase progressively with the scale of the business.

How large might the fund be?

The amount cannot yet be forecast reliably because a complete, publicly verified dataset of Malaysian platform-service revenue by operator is not available in a form sufficient to calculate the contribution base.

An indicative estimate is nevertheless possible. The Google, Temasek and Bain e-Conomy SEA 2025 Malaysia report places the transport-and-food digital sector at approximately US$4 billion in gross merchandise value in 2025.¹⁸ This is transaction value, not platform revenue. Using an illustrative exchange rate of RM4.30 per US dollar gives a market value of approximately RM17.2 billion.

The Southeast Asian report gives regional 2025 estimates of approximately US$2.4 billion in food-delivery revenue on US$23 billion in GMV, and US$1.9 billion in transport revenue on US$11.5 billion in GMV.¹⁹ Those ratios suggest that platform revenue may be much smaller than transaction value, with food delivery and transport showing different revenue-to-GMV relationships.

If these regional ratios are used only as rough benchmarks for Malaysia, they imply platform-service revenue of approximately RM1.8 billion to RM2.8 billion from the transport-and-food segment. This is an analytical proxy, not observed Malaysian revenue or a forecast of the amount legally subject to a levy.

The proportion of that revenue above the proposed exemption threshold is also unknown. If, purely for scenario analysis, 60% to 90% of the proxy revenue qualified, the contribution base would be approximately RM1.1 billion to RM2.6 billion. A flat effective rate of 1.5% on that illustrative base would generate roughly RM16 million to RM38 million annually, with a central scenario of about RM26 million.

A reasonable initial planning range is therefore approximately RM20 million to RM40 million per year, subject to validation. The actual yield from the proposed graduated rate schedule could be different because the distribution of revenue across operators is not known. The Government should not present this estimate as a committed revenue forecast.

Before deciding the final rate, regulators should obtain confidential data on covered Malaysian revenues, related-company structures, commissions, other qualifying fees and current expenditure on worker protection. These data would allow a more reliable estimate of the contribution base and the burden on individual platforms.

How should the fund be administered?

Although the MCMC examples are valuable, the proposed fund should not automatically be placed under MCMC. Telecommunications and postal-service funds have sector-specific legal purposes. A fund principally concerned with labour protection, social insurance and worker transition would fit more naturally within Malaysia's labour and social-protection institutions.

The preferred arrangement would be a dedicated statutory fund under the Ministry of Human Resources, with PERKESO and EPF involved in matters within their respective mandates. MCMC could participate in platform-related regulatory coordination and technical issues where this falls within its legal powers.

The fund's governance should include government, gig-worker representatives, platform operators and independent experts. It should publish audited accounts, contribution rules, allocation criteria, administrative expenditure, approved commitments and measurable outcomes. Workers and the public should be able to see how the money is used.

This transparency requirement is especially important in light of the telecommunications USP experience. Khazanah Research Institute's 2023 assessment reported that the USP Fund had accumulated RM10.6 billion by the end of 2021, while recommending more detailed programme reporting and easier access to allocation information. That balance is a historical figure, not the current balance.¹⁶

A new gig-worker fund should not accumulate money merely because the law permits it to collect contributions. It should maintain a defined reserve, allocate resources against measurable needs and undergo independent review after three years. If contributions consistently exceed justified expenditure, the rate should be reconsidered rather than allowing the balance to grow without a clear public purpose.

8. Collective representation, safety and effective remedies

Fair platform work cannot be achieved through individual disclosures alone. Workers need practical channels to raise collective concerns.

Act 872 recognises gig workers' rights to form, join and participate in associations. Malaysia should build on this foundation by encouraging regular, structured dialogue between worker representatives, platforms and public authorities. Discussions should include material changes to earnings, incentives, safety rules and automated decision-making.

The proposed Gig Worker Protection and Transition Fund could support worker education and access to independent advice, but it should not act as a substitute for collective representation or the dispute-resolution mechanisms established by the Act.

Occupational safety requires similar attention. The Malaysian rider study provides evidence that physical risks deserve preventive intervention, but the law should not assume that every injury arises from an algorithm. Platforms should review dispatch deadlines, performance incentives and working conditions for risks that can reasonably be prevented.¹,⁶

The existing conciliation and tribunal framework should also be monitored carefully. The Government should publish aggregated information on complaint volumes, resolution times, outcomes and compliance with awards. Such publication would help determine whether the new legal remedies are accessible and effective.

An additional question deserves scrutiny: Act 872 defines a gig worker by reference to Malaysian citizenship or permanent residence.¹ The Government should assess how platform workers who fall outside that definition are treated under other applicable laws and ensure that the relationship between the regimes is clear. This is a question for legal review, not proof that every excluded person lacks all protection.

9. A practical reform agenda for Malaysia

The next stage should focus on measures that can be implemented through existing institutions where legally authorised, with targeted regulation or amendments where necessary.

First, Malaysia should finalise an evidence-based minimum-earnings standard through the Gig Workers Consultative Council. The standard should account for relevant work-related expenses and establish a transparent method for determining whether qualifying earnings fall below the prescribed floor.

Second, the Government should make earnings statements more accessible and strengthen the rules governing significant automated decisions. Workers should be able to understand material pay calculations, challenge serious errors and receive timely human review.

Third, Malaysia should strengthen social protection by evaluating platform-funded contributions to PERKESO and developing an appropriate EPF contribution for qualifying platform earnings. The interaction with existing statutory protections and i-Saraan Plus eligibility must be clarified before introducing new obligations.

Fourth, it should consult on the Gig Worker Protection and Transition Fund, publishing the proposed contribution base, exemption threshold, rate schedule, spending purposes and governance arrangements. The RM20 million to RM40 million annual planning range should be refined using actual platform data before any final rate is prescribed.

Fifth, regulators should establish a common set of indicators for assessing worker outcomes, including net earnings, contribution coverage, complaints, deactivation, dispute-resolution times, workplace injuries and the results of algorithmic audits. The new fund should be evaluated against the same principle: resources should be directed towards measurable improvements, not merely collected or spent.

Finally, the Government should review the framework after sufficient implementation data have accumulated, with worker representatives, platforms and independent researchers participating in the process.

The Budget 2027 speech states that the Gig Workers Consultative Council was still negotiating minimum-income rates, the formula for calculating income and minimum social-protection standards, with completion expected in early 2027.⁴ Those matters should therefore be treated as announced or ongoing policy processes rather than settled legal standards.

Conclusion: regulate the exercise of platform power, not technology for its own sake

Malaysia should not seek to eliminate the flexibility that makes platform work valuable. Nor should it assume that every algorithm, incentive or variable price is inherently unfair.

The more defensible objective is to ensure that flexibility does not become a justification for opaque remuneration, arbitrary decisions, inadequate protection or ineffective remedies.

China's draft framework demonstrates the importance of addressing workers subject to enterprise labour management and regulating algorithmic systems, but it remains a proposed measure rather than enacted Chinese law. Singapore shows how platform operators can be assigned explicit responsibilities for injury protection, retirement contributions and representation. Australia offers a model for enforceable minimum standards and earnings-floor top-ups. The EU provides an adopted legislative framework for employment-status determination and algorithmic accountability, with national implementation still due as of the date considered here.

Malaysia's strongest path is to build on Act 872 rather than duplicate it: make earnings records automatic, clarify algorithmic disclosure and review, audit high-impact decisions, improve social protection, support collective representation and publish evidence of implementation.

The proposed Gig Worker Protection and Transition Fund could add a further layer of support by financing shared services and targeted assistance that individual platforms may not provide adequately on their own. The MCMC USP and Postal Service Fund models show that pooled sectoral funding is institutionally possible, but they do not establish that a gig-platform levy is automatically justified. A dedicated fund would need its own legal basis, proportionate contribution rules, clear objectives and transparent governance.

The central test is straightforward: can a gig worker understand how pay is determined, challenge a significant error, obtain the social protection provided by law and participate meaningfully in discussions that affect working conditions?

A regulatory framework that can answer yes to those questions would preserve the benefits of digital platforms while making gig work more secure, accountable and fair.

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References (APA 7th edition)

1. Malaysia. (2025). Gig Workers Act 2025 (Act 872). Ministry of Human Resources. https://www.mohr.gov.my/aktapekerjagig2025/assets/documents/Act%20872.pdf

2. Ministry of Human Resources, Malaysia. (2026). Akta Pekerja Gig 2025: Subsidiary legislation and implementation materials [Gig Workers Act 2025]. https://www.mohr.gov.my/aktapekerjagig2025/download.html

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