24/10/2022

RES519 LAW OF PROPERTY II

MALAY
LECTURE 2

RESERVATION
ENACTMENT Prepared by:
Dr. Anis Syazwani binti
Sukereman
Centre of Studies for Estate Management,
College of Built Environment
Universiti Teknologi Mara (UiTM)

Table of contents
What students will learn today;

Malay Reservation
Historical Rationale Definition of MRL
Enactment
Historical background Legislation in Malay Definition of MRL and
of Malay Reservation Reservation Land Comparison of ‘Malay’
Land definition in MRL
related legislation
Challenges Prospect

Issues and Challenges The prospect for Malay

of Malay Reserve Land Reserve Land
Development

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HISTORICAL
BACKGROUND
MALAY RESERVATION LAND

HISTORICAL BACKGROUND
British in Malaya
Increasing of
Rice consumption When the British brought in immigrants
from China and India to work in
Malaya, vast tracks of land were
allocated to the immigrants for
commercial agriculture ( e.g. rubber,
tea plantations) and tin mining. Feeling
dispossessed and outclassed in their
own motherland, Malays sold their
land in urban areas and moved to
the villages.

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Let’s see some historical pictures

Chinese miners (Yap Ah Loy)

Source : Galeri Diraja Tuanku Jaafar https://gdtjns.com/

Indian Plantation workers

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The British also noted that the Malays were in

the habit of taking up loans from chettiars and
pledging their land as security. They eventually
lost their lands to these chettiars upon
foreclosure for failure to pay off the loans.

IDEOLOGY OF MALAY
RESERVATION
The principal reason British
introducing Malay Reservation is
to prevent the prominence of
To protect Malay land and
Chinese community, which was proprietary interest to
growing strong with forming of prevent Malays from
secret societies (kongsi gelap) dealing with immigrants.
and gaining economic
dominance compared to others
immigrants

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MALAY
RESERVATION
ENACTMENT
PRE-MERDEKA LAWS
POST-MERDEKA LAWS

PRE & POST MALAY RESERVATION LAND LAW

PRE-MERDEKA LAWS POST MERDEKA LAWS

Federated Malay States Malay Malay Reservation Enactment (FMS Cap 142)
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1 Reservation Enactment No.15 of and used until today.
1913 Malay Reservation Enactment Kelantan 1930
Malay Reservation Enactment Kedah 1931
Federated Malay States Malay 2 Malay Reservation Enactment Perlis 1935
2 Reservation Enactment No.30 of Malay Reservation Enactment Johor 1936
1933 Malay Reservation Enactment Terengganu 1941

3 Federal Constitution of Malaysia

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Question:
How about Malay
Reservation Enactment in
Penang and Malacca?

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“Kami isytiharkan dan kami simpan untuk kamu, dan

kami benarkan kamu untuk mengisytiharkan dan
simpan untuk anak cucu, selain gunung-ganang,
tasik dan hutan simpan, Tanah Simpanan Melayu
sehingga nisbah 50 peratus, selebihnya kamu
berebutlah bersama-sama kaum lain”.

— The second will by Raja-raja Melayu

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FEDERAL
CONSTITUTION
Article 89 (1)
Land declared as MRL before Merdeka
Day will continue to be subjected to the
enacted Enactments.

Article 89 (2)
A new MRL area can be declared provided that an equal
area is made available for general alienation.

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MALAY RESERVATION
OBJECTIVE
Objective 1 Objective 2
Prevent State Land in Prevent any private
Malay Reservation Area dealings between Malay
from being disposed by and non-Malay in term of
any means to the non- Malay Holding or Malay
Malay. Reservation Land

With the two objectives, it is hope that land hold by the

Malays will be controlled by the Malays in the future.
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POWER OF DECLARATION
In the state of Perak, Selangor, Negeri Sembilan and Pahang,
where the Malay Reservation Enactment (FMS Cap 142) are
used, the power of declaration falls under the Chief Minister of
the State with the approval from the Ruler of the State in Council.

In the State of Johor, the State Director of Land and Mine with
the approval from the Ruler of the State in Council, while in
other States, it is the Ruler of the State in Council.

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PURPOSE OF DECLARATION

To declare any To alter the

area fo land limit or
within the State boundaries of
to be a Malay any Malay
Reservation Reservation.
Area.

To revoke any Malay

Reservation Area.

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LAND THAT CAN BE DECLARED

AS MALAY RESERVATION.

State Land Land Reserved for

a public purpose

Reserved
Forest Land Alienated Land

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CONDITION FOR DECLARATION

Only land that has not been developed or cultivated
may be declared as Malay Reservation.

If 100-hectare land is declared as Malay

Reservation, an equal area of land of 100 hectare
which has not been developed or cultivated shall
be made available for general alienation to the
general public including the Malays.
[Federal Constitution, Article 89 (2)].

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CONDITION FOR DECLARATION

If any part of the land ceases to be a Malay
Reservation either wholly or only part of it, any other
land in that State with a similar character and of area
not exceeding the area of that land must be
immediately declare as a replacement. Without
replacement, the revocation is not valid

[Federal Constitution, Article 89 (3)].

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Revocation and Replacement of

Malay Reservation Land
Question:
Based on Article 89 (3) of Federal Constitution, if Malay Reserve land is revoked, then
the State Authority has to replace it with any other state land, under what condition?

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Same
category of
It is similar in character Same type of land use
soil
Potential for
development
Location similar
similar.
Same (Access to
economic road)
value relating
to type of “Allowing a reasonable
cultivation time for doing it”
-case: V SP Suppiah Chettiar v KS
Navaradnam [1972]

Should be done
immediately

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CONDITION FOR DECLARATION

Any land which is owned or occupied by a non-malay
or which such a person has then any right or interest
cannot be declare as Malay Reservation.
[Federal Constitution, Article 89 (4)].

Malay Reservation Remain as a Malay Reservation

Any land that were declared to be a Malay Reservation
must remain as Malay Reservation until it is otherwise
declared and gazetted as being revoked by the parties
concern
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RESTRICTION ON DEALINGS TO
NON- MALAYS (UNDER MRE)
S8 of Federated States (F.M.S) Malay Reservation
Enactment (MRE)
“No Malay holding shall be transferred, charged, leased or
otherwise disposed of to any person not being a Malay”

MALAY HOLDING MALAY COMPANY

S.2(a) FMS MRE 1933 and S.2(d) Terengganu Requirements of Malay Company are:
MRE define a Malay holding as: (a) Registered under Companies Act 1965
• Either the proprietor or co-proprietor are Malay; (b) All members are Malays
• Alienated land; (c) Transfer of shares restricted by Articles of
• Such land has been declared and gazetted as MR Association to Malays only
land; and (d) Objective of Company is to deal in Malay
• Such land has been included in the official MR list. holding land.

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OTHERS RESTRICTION (UNDER MRE)

S7. Prohibits of alienating, granting a license or permit and leasing of State
land in Malay Reservation to a non-Malay
S8. Prohibits charging of any Malay holding to a non-Malay

S8. Prohibits leasing of Malay holding to a non-Malay

S9. the execution of any instrument of dealing in respect of Malay holding

by any person acting under a power of attorney if that person is not a
Malay

S10. prohibits creation of lien over a Malay holding even in favour of a

Malay

S11. States that no private caveat, trust caveat can be registered in a

Malay holding if caveator not a Malay

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DEFINITION
MALAY RESERVE LAND
& ‘MALAY’

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MEANING OF MALAY RESERVE LAND

Malay reserve land refers to that The State Authority, in exercise of its
special category of land situated disposal powers under the Code, can
within the territorial boundaries alienate such lands only to Malays
of each state in Peninsular and what
Malaysia which can only be constitutes a ‘Malay’ depends on the
owned or held by Malays. definition and interpretation of that
term as determined in the respective
State legislation.

Dealings in respects of such lands,

such as transfers, leases, charges
and easements can only be
transacted amongst Malays and any
attempt by non- Malays in dealing
such Malay reserve lands will be
held null and void.

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DEFINITION OF
‘MALAY’
Article 160 Federal Constitution
lays down 4 requirements:
• Domiciled in Malaysia/Singapore
• Muslim
• Speaks Bahasa Malaysia
• Complies with Malay customs

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MRE KELANTAN
S.3 (i) provides a ‘Malay’ means a person belonging to any Malayan
race who speaks any Malayan language and professes the
Mohammedan religion, and shall include ;
a) the Majlis Ugama Islam
b) the Official Administrator when acting as administrator or trustee of the
estate of a deceased Malay.

MRE KEDAH
-S.2 of Kedah Enactment provides a ‘Malay’ means a person professing the
Muslim religion and habitually speaking the Malay language of whose
parents one at least is a person of Malayan race or Arab descent.
(Vide E 9/54 Kedah Laws 1559)
-Siamese is included as natives and has right to acquire Malay reserve lands.

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MRE PERLIS
S.2 a ‘Malay’ means a person belonging to any Malayan
race or person of Arab descent who habitually speaks
the Malay language or any Malayan language and
professes the Muslim religion.

• ‘Siamese’ means a Siamese certified by Commissioner in

writing to be a Siamese agriculturist permanently resident in
State of Perlis.
• Perlis being situated near border of Thailand, a Siamese has
right to acquire MRL.
• Person of Arab descent who habitually speaks Malay language
is considered Malay in Perlis.

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MRE JOHOR
‘Malay’ means a person belonging to the Malay or any Malaysian race who
habitually speaks the Malay language and professes the Muslim religion and
such expression shall be deemed to include the authorities, boards, bodies,
societies, associations and companies described in the Second Schedule to
this Enactment:
With a preamble that reads An Enactment to prevent interests in land passing out
of the hands of the Malay race. Johor Malay Reservation Enactment 1936 has
employed the word ‘Malaysian’ instead of ‘Malayan’.

MRE TERENGGANU
‘Malay’ means a person belonging to any
Malayan race who habitually speaks the
Gambar Hiasan Malay language or any Malayan language
and professes the Moslem religion.

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ISSUES AND
CHALLENGES
MALAY RESERVE LAND

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Based on Laporan Ketua Audit Negara 2013, there

are only 12 percent of the MRL left, instead
of 50 percent. The decrease in percentage of
MRL in 2013 had happened due to the
cancellation of the reserve status and not
replacing it, as well as the greedy attitude of
landowners who expect instant profit.

There was an increament in the

percentage of the MRL after
three (3) years after the report
was presented, which is now
estimated to 33.3 percent
Data from Director of State Land and Mining
Office 2009 (Kurniawati Kamarudin, 2018).

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Data, information and

ISSUES ON MRL
research on MRL

Lack of structured
Multiple ownership & data, information and
Legislation size issues crucial research on
Location & MRL is something
infrastructure issues Many Malay that needs to be
The legal restriction
imposed on property and reservations plots have addressed. the
the land ownership is the Most of the Malay multiple owners, while responsible parties
major factor that has reserved lands are some are of need to update the
facing the problem of uneconomic size for data and information
reduced the financing
substandard cultivation or making them more
potential and the development. It is
marketability of these infrastructure and transparent,
inadequate community based on Malay
areas. Lack of uniformity inheritance laws and especially on the
facilities. For many of total land area of
of the Enactments traditions; the
between different states Malay reservation property has multiple MRL.
and Statutory control and sites are in areas and fragmented
limitation. where infrastructures ownership.
and services are
minimal or non-
existence.
Source: https://doi.org/10.21837/pm.v19i17.1001

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Mind-set issues

ISSUES ON MRL A lack of research and

statistics on the
successful
Development issues developments on MRL
Low market value
is one of the factors
Financial issues MRL development has that prolonged the
The land value for MRL is
been left behind from ignorance and
less than four times the
No holistic financial the current negative mind-set of
value of non-Malay development. The MRL
model to facilitate the the public about the
Reserve Land. Currently, which is located far
real estate status of MRL today. It
most of MRL is either left inland, has also led to
development process is time that the
idle or underutilised. challenges in
for MRL in Malaysia. success story of MRL
Compared with its developing them in
No initial fund for the utilisation and
neighbours, MRL is terms of their suitability
development and No development be
considered as lagging and risks which turns to
support from financial uncompetitive highlighted for the
behind its neighbours’
institutions. development and public awareness. It is
economic development
Undervalue of MRL. time to create role
although it has the
models among the
potential to be developed.
successful MRL
owners and
Source: https://doi.org/10.21837/pm.v19i17.1001 developers.

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THE PROSPECT
AND POTENTIAL
MALAY RESERVE LAND
DEVELOPMENT

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THE PROSPECT OF MALAY RESERVE LAND

The Malay reserve land should be allowed for leasing to
Allow Malay Reserve anyone, including non-Malays. When the lease expires,
Land to Be Leased ownerships remain with the original owner. The
suggested term is not more than 60 years.

All banks should be allowed to deal with Malay reserve

land. Currently, only limited numbers of bank listed
Loan Flexibility under Malay Reservation Enactment permitted to deal
with such land.

The Malay reserve land can be developed by establishing

a land trust. The State government may set up a special
Land Trust body and allocate the development capital to such body
to develop the land for the benefit of the Malay owner.

Malay Reserve Land The Government should set up a MRLDC who will be the
Development coordinator for MRL developments. The council will have
the force to command manpower, expertise and funds to
Council (MRLDC) develop MRL.

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CONCLUSION
At the end of class, students should be able to understand :

1) Historical background of Malay Reservation Land : The impact of immigrants

from China and India & the principal reason British introducing Malay
Reservation

2) Legislation in Malay Reservation Land : Pre and Post Merdeka Laws related to
MRL and overview of Malay Reservation Enactment.

3) Definition of MRL and Comparison of ‘Malay’ definition in MRL related legislation.

4) Issues and Challenges of Malay Reserve Land : 8 issues (Legislation, location &
infrastructure, multiple ownership & sizes, data, information & research, low
market value, financial, development and mind set issues).

5) The prospect of Malay Reserve Land : 4 Prospect (Allow Malay Reserve Land to
Be Leased, Loan Flexibility, Land trust and and Malay Reserve Land
Development Council (MRLDC)

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TUTORIAL

Zaki and Co Property Company located in Kedah entered into a sale and
purchase agreement to buy a parcel of Malay reserved land in Sg. Petani from
Haji Syukri in August 2020. Zaki and Co Property Company is a Malay company
that approached Affin Bank Bhd for a loan facility of RM900,000 to develop the
reserve land into a residential area. However, the charge cannot be enforced
since Affin Bank Bhd was not qualified as “Malay” due to it not being listed in the
Second Schedule of the Malay Reservation Enactment Kedah 1931. Write a
short note that could:

1)Advise the parties involved and

2)Examine any possible solutions relating to Malay reserve land in Malaysia.

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THANKS!
Do you have any questions?
[email protected]

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