Malaysia seeks legal harmonization to lift ASEAN trade, investment
Regional framework needed to address cross-border disputes, minister says
TOKYO -- Malaysia is seeking legal harmonization among ASEAN member states on issues pertaining to cross-border commercial disputes, insolvencies and other business issues, which its law minister says is crucial to support trade and investment in the region.
Azalina Othman Said, Malaysia's minister of law and institutional reform, told Nikkei Asia on Friday that these will be among key topics at the ASEAN Law Forum, which her country -- as chair of the bloc -- will host in Kuala Lumpur in August.
It will be the group's first ministerial gathering focusing on legal issues, reflecting the rising need to address commercial disputes and other business matters involving different countries in the region, which has become a manufacturing base for tech and other industries.
"As a minister in charge of law, I believe there is a great potential to have laws that can make ASEAN countries work faster and better with each other, although we speak different languages," Azalina said on the sidelines of a visit to Japan, a major source of investment in the region and a country with which the bloc is hoping to deepen legal cooperation.
"Access to justice through efficient alternative dispute-resolution mechanisms, such as arbitration and mediation, is critical for creating a fair, transparent and reliable commercial environment," Azalina said.
The former lawyer cited as an example the need for ASEAN countries to have laws on cross-border insolvencies, "whereby if you declare that [an] insolvent company is being wound up, you can cross the jurisdictions to extract the assets." She said Singapore already has such a law and Malaysia is preparing one this year, but some other ASEAN countries do not.
Azalina said the law forum will also be a good opportunity to discuss a cross-border commercial arbitration platform, an idea that is gaining importance as ASEAN countries seek to increase trade and investment in the face of rising global uncertainty, including the current trade war.
"[For] businesses to grow, you must have a platform to settle disputes. I think no one wants to go to [a nation to do] business if they don't think the country can guarantee them a very safe passage when it comes to legal representation, access to justice, legal rights," she said.
"Why would you invest in a country [that] has a kangaroo court? I think that is the message that we, as [the] chair of ASEAN, want to give so that ASEAN member states can benefit from the same premise."
Unlike the European Union, where members produce laws on issues such as trade and taxes through the European Parliament, ASEAN does not have such a mechanism.
Azalina said the August forum is intended to change that. With "Malaysia chairing, what we want ... is not just talk about" cross-border frameworks, but also to deliver "implementation."
But she declined to speculate on how long it might take to achieve a breakthrough.
The minister said ASEAN member states also need to adopt a common stance on the use of technology, especially artificial intelligence, in legal situations. Using AI tools such as ChatGPT, for example, can lower fees for drawing up legal documents, such as statements of claim and letters of demand, which will improve "access to justice" for people in the region, she said.
With the number of foreign workers and immigrants rising, laws also need to be harmonized pertaining to their rights and legal action that might be taken against them, Azalina said, adding that the prevention of online harms, such as child grooming and content promoting suicide, is another area where ASEAN needs to improve.
"The platform providers are not happy [with] any government that wants to regulate social media. Facebook is very big, Twitter is huge, so it's not easy," Azalina said. "But if all the countries have the same conversation, then maybe the social media platforms will be more wary."