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Protecting Intellectual Property in Malaysia – Law or Enforcement

It was recently commented by the Penang Local Government, Traffic Management and Environment Committee chairman, Chow Kon Yeow that ‘Although intellectual property laws in Malaysia are in place and confirmed with international standard for intellectual property protection needs, enforcement initiative by relevant government agencies is required to effectively protect both foreign and local investors’ intellectual property rights and interests1.’ Malaysia, according to Chow, has ample intellectual property protection, but lacks effective enforcement to fully protect these rights.

However the effectiveness of the law itself has been questioned by some parties, such as Davie Llewelyn, the Intellectual Property Academy of Singapore’s Deputy Chairman and external director, who recently said that ‘Malaysia is probably behind some of the other countries in recognising intellectual property.’2 This view may be somewhat jaundiced as Singapore’s increased intellectual property protection has come about largely as a result of its treaty obligations.

Therefore the issue that would need to be considered as to intellectual property rights in Malaysia would be what has to be tackled the law itself or its enforcement?

Legal Aspects

Intellectual property rights in Malaysia did not take off until 1983, when the Trade Mark Act 1976 came into force3. Comparatively, America intellectual property laws trace its origin to at least 218 years ago, when the first United States Patent Act 1790 was enacted.

However, Malaysian law had rapidly changed over the past 25 years or so. Largely due to its commitments under its obligations under TRIPS Agreement and involvement with the World Intellectual Property Organisation (WIPO). In view of those treaty commitments intellectual property law in Malaysia has undergone a great transformation to align the local law with the minimum standards as provided by TRIPS and in some cases Malaysia has in fact surpased some of the minimum requirements. Among the most recent updates includes the Patent (Amendment) Act 20064, which incorporates the Patent Cooperation Treaty into Malaysian law, the Geographical Indications Act 20005, which incorporates the Paris Convention6, and the Plant Varieties Act 2004, which protects plant varieties, all new advances in Malaysian intellectual property laws.

The compliance with their TRIPS obligations has shown that Malaysia has the appopriate legislative structure in protecting intellectual property rights. The legislative changes that are pursuant to TRIPS plus are not about to be enacted in Malaysia unless they come together with some other benefits to the country such as a Free Trade Agreement (FTA) which in the case of Singapore saw major changes to the intellectual property regime as a result of the US-Singapore FTA.

As a nett importer of intellectual property it is therefore unlikely for further concessions to be made in the intellectual property front without further treaty obligations which will give Malaysia trade concessions in return.

Enforcement of laws

Effectiveness of intellectual property protection in Malaysia however depends heavily on the enforcement of laws in Malaysia. In the eyes of the international community, Malaysia is generally lax when it comes to this. Not surprisingly, Malaysia had been on the US Government’s Special 301 watch list since 20027. Intellectual property protection is also an ongoing issue on the US-Malaysia Free Trade Agreement negotiations.

A glaring example of this is the Recording Industry Association of Malaysia’s (RIM) frustration that 90% of music piracy cases that it has brought to court over the past few years has ended in defeat10. RIM’s CEO, Tan Ngiap Foo, had voiced the Association’s concern about prosecuting officers being administrative staff from the Domestic Trade and Consumer Affairs Ministry, without proper legal qualifications and being outclassed by legal counsels employed by the pirates; something of major concern. Qualified lawyers should be recruited to argue the Ministry’s case in court, else all efforts of enforcement will come to naught. However the recording industry could also do more to support the prosecution and it remains to be seen what they will do.

Enforcement of intellectual property rights did make great strides in Malaysia, especially for the past year. The USTR on its 301 watch list report are amongst those who commend Malaysia for ‘strong commitment to strengthening IPR protection and enforcement’. The International Intellectual Property Alliance (IIPA) also noted that ‘the Malaysian Government has made a significant effort over the past several years to preserve intellectual property rights8.’

Enforcers are particularly busy for the past year. July 2007 saw the launch of “Ops Tulen”, being a campaign targeted to eradicate piracy and counterfeit goods in Malaysia. On 12th June 2008, it was reported that seven corporate firms were nabbed and RM800,000 worth of hardware and pirated software were seized9. More recently, on 24th October 2008, The Ministry of Domestic Trade and Consumer Affair launched its Sikap Tulen IT Mall campaign, with the aim of stamping out software piracy in IT retail outlets in the country’s malls.

17th July 2007 marked the advancement of intellectual property enforcement in Malaysia, when an intellectual property court was established, in line with the TRIPS Agreement. This was applauded by the international community as another indication of Malaysia’s resolve to protect intellectual property rights. Aussino (M) Sdn Bhd earned the dubious distinction of being the first local company to be found guilty in the Court for possessing copies of pirated software.

Nevertheless, more enforcement of the law is needed, as piracy and breach of intellectual property rights are still prominent in Malaysia. It is still common to see counterfeit goods, pirated discs and knock-off of luxury products being sold openly in Malaysia.

Undoubtedly, Malaysia has the intent to protect intellectual property rights. Both enforcement and laws are lacking in certain aspect, but the intention to improve is always there, as seen from the government’s recent actions. However, companies should be made aware of their intellectual property rights and should not hesitate to initiate their own legal actions against those who breached their rights.

As what Branding Association of Malaysia president Lewre Lew said, ‘It is time for business owners to change their mindset to become brand owners, to build intellectual property11’ Malaysia’s intellectual property rights will never be fully protected as long as businesses are ignorant on the rights that they have.

It can therefore can be said that the issue in Malaysia with intellectual property is enforcement and not the laws, as intellectual property legislation here is in line with international standards.


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