86

CHAPTER FIVE: Logistics stakeholders

Contents: Introduction, Ministry of Transport Malaysia, Bilateral and International Agreements, Royal

Malaysian Customs, Land Public Transport Commission, Road Transport Department, Permit Issuing

Agencies for Cross Border Trading, Trade Associations and Chambers of Commerce as Intermediaries,

The Logistics Businesses, Conclusion

Key points:

1. The Ministry of Transport Malaysia is fundamentally a policy formulating,

planning and supervising entity and its regulatory and policy implementing

functions are carried out by various statutory agencies under its purview. The

functional responsibilities are structured into three divisions – Land and

Logistics, Maritime, and Aviation. These agencies oversees the development of

the all aspects of logistics economy, from its infrastructure development,

international harmonisation of flow of goods, governance of logistics activities

to policy development.

2. Malaysia is a signatory to various bilateral and international agreements,

conventions and protocols, which are aimed at enhancing efficiency of cross-

border trade. The responsibility of planning, formulating, negotiation,

implementing and managing these agreements is under the purview of MOT.

3. Royal Malaysian Customs is the government agency responsible for

administrating the nation's indirect tax policy. JKDM administers seven main

and 39 subsidiary laws. Besides this JKDM implements 18 laws for other

Government agencies in its gatekeeping function for the flow of goods across

national borders.

4. The Land Public Transport Commission is empowered under the Land Public

Transport Act 2010. Its function covers the drawing up policies, planning,

regulating and enforcing all matters relating to land public transport and for

Peninsular Malaysia. Land public transport covers train, bus and taxi services

as well as road- and rail-based freight transport. It works in close cooperation

with other enforcement agencies such as the Royal Malaysian Police and the

Road Transport Department.

5. The Road Transport Department Malaysia, under the Land and Logistics

Division, is responsible for licensing of vehicles and drivers and the enforcement

of the Road Transport Act 1987 Act 333 to ensure safe drivers and safe

vehicles. Its enforcement activities also include provisions from the Commercial

Vehicle Licensing Act 1987.

6. There are over 20 agencies under 12 different ministries that exercise regulatory

controls on the import and export of controlled goods. They are the permit

issuing agencies having the regulatory aim of protecting the environment, the

biodiversity of the country, health and safety of the people, local businesses and

national security and sovereignty. Permits are also used to protect local

industries, particularly manufacturing, against practices such as anti-dumping

87

protection. Control is also exercised on strategic trade items to protect the

national interest.

7. Intermediaries here are the organisations that assist communication and

coordination between the logistics businesses and the regulators. They provide

services and/or build relationships for regulatory compliance and issue

resolutions between regulators and the businesses. These are the trade

associations and chambers which act as go-betweens between the businesses

and the authorities to deal with regulatory and other issues of concern to

businesses. The authorities regularly consult with these bodies on government

policies and their implementation.

8. To cope with business demands and constraints on government capacity

expansion and to improve service delivery, the Government outsources some

of its functional activities to private firms or privatises specific functional

activities or sets up a private commercial entity or appoint trade associations to

deliver the services. These services may be inspection, testing, certification,

data processes among others.

9. Ports and shipping are major links in the logistics chain and are essential in

facilitating trade in Malaysia and the port operators assumed a critical role in

trade and transport, providing a link between the shipping service and the inland

transport system. The ports act as crucial points of interface with other transport

modes - road, rail, river and air. The port operators are regulated by the Port

Authorities under the respective Port Authorities Acts.

10. Warehousing is an important intermediate activity in the logistics chain. The

warehouse activities include receipt of product, storage, shipment, and order

picking. Managing warehouses efficiently ensures that goods flow from the

manufacturers or producers to consumers in without interruptions and

undesirable delays. Except for bonded or licensed warehouses, there is no

specific warehousing regulation for this activity.

Introduction

The Seven-step Transportation Chain model, referred here as the logistics value

chain (LVC), provides a process-based framework for analysis on reducing

unnecessary regulatory burdens (RURB) on the logistics industry. This framework

focuses on sea freight import-export logistics activities.

The LVC analysis guides the search and identification of stakeholders of interest for

this study. The stakeholders may be as two main groups – the businesses and their

trade associations, and the regulator which is represented by the ministries and their

agencies. Many Government agencies also out-sourced some of their regulatory

activities, such as inspection and certification activities. The trade associations and

these Government outsourcing entities will be referred to as intermediaries of

88

businesses and regulators. Many industry and government websites are able to

provide pertinent information on the stakeholders. Two notable web portals have been

most helpful in identifying these key stakeholders. They are the Malaysian Trade

Facilitation portal (myTRADELINK; www.mytradelink.gov.my) and the Malaysia

Logistics Directory portal (www.msialogistics.com).

This chapter provides relevant information on the stakeholders who have major roles

in this LVC. A number have been approached to help identify unnecessary regulatory

burdens of this particular logistics sub-sector. The stakeholders are analysed as three

separate groups being (a) the regulators represented by the ministries and the

agencies, (b) the businesses representing the logistics businesses and the

consignees/consignors, and (c) the intermediaries.

Ministry of Transport Malaysia1

The four modes of transportation – air, land, rail and sea – are the core elements in

the LVC. These modal activities in freight transportation have varying degrees of

hazardous impacts on people and the environment. To mitigate any potential

hazardous impacts regulatory interventions are deemed necessary on these activities.

The Ministry of Transport (MOT) takes on the responsibility of ensuring the country’s

freight transportation is safe and efficient and facilitating economic growth. The role of

MOT is as defined in its various functions as shown in Box 5.1 below.

Box 5.1: Functions of Ministry of Transport Malaysia The functions of the Ministry are:

Plan, devise and implement policies with regards to rail, maritime, aviation

transportation and ports.

Implement physical development projects which involve rail, maritime, port and civil

aviation infrastructure.

Manage the integration of intermodal transportation to achieve seamless travel.

Provide Licensing Services :

Service provider licenses and concessionaires (albeit commercial vehicles).

Individual vehicle licenses - private cars, business, pilot for aviation and maritime

and others

Domestic Shipping Licenses

Registration of all modes of vehicle.

Determining the pricing policy (except for land commercial vehicles).

Monitoring of policies and concessionaire / government linked companies.

Identifying and monitoring legal issues, service and safety standards.

Conduct regional and international cooperation programmes in the transport sector.

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

1 Ministry of Transport Malaysia; http://www.mot.gov.my

89

The MOT is fundamentally a policy formulating, planning and supervising entity and its

regulatory and policy implementing functions are carried out by various statutory

agencies under its purview. These agencies ensure that the policy and various

regulations are implemented to ensure the economic objectives of the country are

achieved. The various agencies are illustrated in the MOT organisation chart in Box

5.2 below.

The policy and regulatory operations in MOT are implemented by three distinct

divisions namely, a) Land and Logistic Division, b) Maritime Division, and c)

Aviation Division. Each of these divisions has its own defined functions and

objectives under the responsibility of different functional units. Box 5.3 summarises the

roles and functions of these three divisions.

The enforcement and regulatory duties for land transport are under the

responsibilities of agencies such as the Road Transport Department (JPJ), Department

of Railways, Railway Assets Corporation (RAC), Road Safety Department (RSD) and

the Malaysian Institute of Road Safety Research (MIROS). Their statutory authority is

defined by two main Acts:

a) the Road Transport Act 1987

b) Railways Act 1991.

As for maritime transport, enforcement and regulatory duties are under the

responsibilities of different agencies such as the Marine Department of Malaysia,

MDM, Penang Port Commission, PPC, Port Authority of Johor, LPJ, Port Klang

Authority, PKA, Kuantan Port, LPKTN, Bintulu Port Authority, LPB, Maritime Institute

of Malaysia, MIMA.

These maritime agencies are empowered under their respective regulations:

a) Cargo Transport by Sea Act1950 [Act 527]

b) Merchant Shipping Ordinance 1952 [Ord. 70/1952]

c) Federal Fire Dues Act 1953 [Act 243]

d) Penang Port Commission Act 1955 [Act 140]

e) Port Authorities Act 1963 [Act 488]

f) Bintulu Port Authority Act 1981 [Act 243]

g) Privatization Port Act 1990 [Act 422]

h) Langkawi International Yacht Registry Act 2003 [Act 630]

i) Gazette On The Exemption Of Foreign Cruise Vessels From The Domestic

Shipping License Requirement

90

Box 5.2: Agencies under the Ministry of Transport

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

The regulation of civil aviation is under the purview of the Department of Civil Aviation.

Unlike the maritime agencies, DCA is a standalone authority which governs all aspects

of aviation activity. The governing function is to maintain and enhance the safety,

security and efficiency of aviation activities. Aviation activities and transport under the

DCA are governed by the following regulations:

j) Civil Aviation Act 1969 [Act 3]

k) Carriage By Air Act1974 [Act 148]

l) Aviation Offences Act1984 [Act 307]

m) Act Airport and Aviation Services (Operating Company)1991 [Act 467]

n) International Interest Act in Mobile Equipment (Aircraft) 2006 [Act 659]

o) Civil Aviation Regulations 1996

91

Box 5.3: Functional Divisions of MOT The Land and Logistics Division is responsible for the development and implementation

of National Transport Policy. The policy is designed to ensure that public land transport

sector remains safe and efficient, based on current needs. The main functions are:

To formulate policies on driving licenses, driving schools, vehicle registration, road

safety and technical standards of vehicle conforming to international standards.

To formulate transport policies in order to increase the quality of land transport

services.

To ensure policies/processes are aligned with National Key Result Area (NKRA)

initiatives.

To develop an integrated rail transportation infrastructure network and multi-

modalism

To implement Malaysia obligation under the ASEAN agreement and cross border

related to road and rail transportation.

To ensure all rules under Railways Act 1991 and Road Transport Act 1987 are in

line with current needs.

To monitor and coordinate infrastructure development projects in the rail-based

transport sector.

To formulate policies on fare rates for railway services.

The Maritime Division consist of 5 units: Port, Maritime Safety, Economy Maritime,

Domestic Shipping Licensing Board Secretariat and International Convention. Maritime

Attache Office is currently attached to High Commission of Malaysia in London to oversee

the debate and discussion held at the International Maritime Organization which involves

Malaysia’s maritime interest. The main functions are:

To encourage Malaysian entrepreneur participation in the shipping industry both

locally and abroad.

To plan and implement policies on navigational safety, pollution prevention from

ship, ship security, property and life at sea.

To frame and implement policies, coordinate and oversee activities of federal ports.

To process application for domestic shipping license.

To review and update existing laws or formulate new laws relating to ports and

shipping, as well as to ratify international conventions related to maritime sector.

The Aviation Division is responsible for all civil aviation affairs in Malaysia. This division is

made up of five units as follow: Air Transport, Airport Services, Aerospace & Industrial

Hubbing, Licensing & Rural Air Services, and Safety/Security & Convention. The main

functions are:

To plan and review the policies relating to air services from time to time.

To expand the international air services network through air negotiations.

To ensure the planning, building and maintenance of airport infrastructure is in

accordance with the specified standards.

To ensure that all existing rules and regulations in air transport / aviation are in

accordance with the guidelines stipulated by the International Civil Aviation

Organisation (ICAO).

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

92

Bilateral and International Agreements2

In order to achieve enhanced efficiency for cross-border trade, Malaysia is a signatory

to various bilateral and international agreements, conventions and protocols. The

responsibility of planning, formulating, negotiation, implementing and managing these

agreements is under the purview of MOT.

For land transport, MOT is activity involved with other countries and relevant

international organisations in programmes related to land transport and safety, through

the:

i. coordination, monitoring and management of the land transportation industry

for enhanced efficiency and effectiveness within the ASEAN region

ii. provision of platforms for international discussions and negotiations

iii. coordination and simplification of procedures for the operation of transit

transportation

iv. updating global changes into the legal framework governing the land

transportation system

v. formulation of infrastructure development policies and review of the domestic

legal framework in order to adopt and adapt the best global practices

Malaysia is a signatory to a list of protocols and working frameworks with the ASEAN

neighbours. The Box 5.4 below illustrates.

Box 5.4: Agreements and Protocols with ASEAN 1) ASEAN Framework Agreement on the Facilitation of Goods in Transit, AFAFGIT (16

December 1998) a) Protocol 1 Designation of Transit Transport Routes and Facilities (8

February 2007) b) Protocol 2 Designation of Frontier Posts (Negotiation Stage) c) Protocol 3 Types and Quantity of Road Vehicles (15 September 1999) d) Protocol 4 Technical Requirements of Vehicles (15 September 1999) e) Protocol 5 ASEAN Scheme of Compulsory Motor Vehicle Third-Party

Liability Insurance (8 April 2001) f) Protocol 6 Railways Border and Interchange Stations (Negotiation Stage) g) Protocol 7 Customs Transit System (Negotiation Stage) h) Protocol 8 Sanitary and Phytosanitary Measures (27 October 2000) i) Protocol 9 Dangerous Goods (20 September 2002)

2) ASEAN Framework Agreement on the Facilitation of Inter-State Transport, AFAFIST (10 December 2009)

3) ASEAN Framework Agreement on Multimodal Transport, AFAMT (17 November 2005)

4) MoU Between The Government of Brunei Darussalam, Indonesia, Malaysia and The Philippines on Cross-Border Movement of Commercial Buses and Coaches (2 November 2007)

5) MoU Between The Government of Brunei Darussalam, Indonesia, Malaysia and The Philippines on Transit and Inter-State Transport of Goods (25 June 2009)

2 Ministry of Transport Malaysia; http://www.mot.gov.my

93

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

Box 5.5: Bilateral and International Maritime Agreements Bilateral Shipping Agreements with the following countries (effective date)

1) Bangladesh (19 April 1983) 2) Turkey (8 September 1983) 3) Belgo - Luxemburge (12 February 1985) 4) Sri Lanka (17 June 1985) 5) Pakistan (24 August 1985) 6) Union of Soviet Socialist Republics -

Russia (31 July 1987)

7) China (9 September 1987) 8) Indonesia (17 June1988) 9) South Korea (21 July 1988) 10) Romania (26 February 1991) 11) Vietnam (31 March 1992) 12) South Africa (7 March 1997)

Internal Maritime Conventions (effective date) include: 1) International Convention on Load Lines (LL) 1966 (12 April 1971) 2) Convention on the International Maritime Organization 1948 (17 June 1971) 3) Convention on the International Regulations for Preventing Collisions at Sea (COLREG) 1972,

as amended (23 December 1980) 4) International Convention for the Safety of Life at Sea (SOLAS) 1974, as amended (19 January

1984) 5) Protocol of 1978 relating to the International Convention for the Safety of Life at Sea 1974, as

amended (19 January 1984) 6) International Convention on Tonnage Measurement of Ships (Tonnage) 1969 (24 July 1984) 7) Convention on the International Mobile Satellite Organization (INMARSAT) 1976, as amended

(12 June 1986) 8) Operating Agreement on the International Mobile Satellite Organization 1976, as amended (12

June 1986) 9) International Convention on Standards of Training, Certification and Watchkeeping for

Seafarers (STCW) 1978, as amended (30 April 1992) 10) Protocol of 1978 relating to the International Convention for the Prevention of Pollution from

Ships, MARPOL 1973, as amended - Annexes I and II (31 January 1997) 11) Protocol of 1978 relating to the International Convention for the Prevention of Pollution from

Ships, MARPOL 1973, as amended - Annexes V (31 January 1997) 12) International Convention on Oil Pollution Preparedness, Response and Co-operation, OPRC

1990 (30 October 1997) 13) Amendments Adopted in November 1991 to the Convention of the International Maritime

Organization - Institutionalization of the Facilitation Committee (9/9/ 2004) 14) International Convention on Civil Liability for Oil Pollution Damage, CLC 1992 (9 June 2005) 15) International Convention on the Establishment of an International Fund for Compensation for

Oil Pollution Damage, FUND 1992 (9 June 2005) 16) The International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001 -

Bunkers Convention 2001 (12 February 2009) 17) The International Convention for the Limitation of Liability for Maritime Claims, 1976 as

Amended by Protocol of 1996, LLMC Convention 1996 (10 February 2009) 18) International Convention on the Establishment of an International Fund for Compensation for

Oil Pollution Damage, FUND (16 October 1978) 19) MARPOL 73/78, Annex III: Regulations for the Prevention of Pollution by Harmful Substances

Carried by Sea in Packaged Form (1 July 1992) 20) MARPOL 73/78, Annex IV: Regulations for the Prevention of Pollution by Sewage from Ships

(27 September 2003) 21) MARPOL 73/78, Annex VI: Regulations for the Prevention of Air Pollution from Ships (19 May

2005) 22) International Convention on the Control Harmful Anti-fouling Systems on Ship (17 September

2008) 23) The Control and Management of Ship’s Ballast Water 2004 (Yet to Enter Into Force)

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

As for maritime transport, Malaysia has concluded agreements with a number of

countries since the eighties to strengthen bilateral cooperation in the maritime sector.

The main provisions of such agreements are:

94

a) On special treatment clause

b) Confirmation of ships and seafarers certificates

c) Bilateral consultation mechanism to strengthen cooperation.

Currently, Malaysia has concluded a total of 12 bilateral agreements on shipping and

has ratified many international conventions adopted by the International Maritime

Organisation (IMO). These are listed in Box 5.5.

In the case of aviation, Malaysia is a member of the International Civil Aviation

Organisation, ICAO. Here, a number of international conventions have been ratified.

These are listed in Box 5.6 below.

Box 5.6: International Civil Aviation Conventions 1) Convention for the Unification of Certain Rules Relating to International Carriage by

Air (1929) 2) Convention on International Civil Aviation (1994) 3) Convention on the Privileges and Immunities of the Specialized Agencies (1947) 4) Convention on Offences and Certain Other Acts Committed on Board Aircraft (1963) 5) Convention for the Suppression of Unlawful Seizure of Aircraft, Hague Convention

1970 6) Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation,

Montreal Convention 1971 7) Convention on International Interests in Mobile Equipment (2001)

Source: Ministry of Transport Malaysia; http://www.mot.gov.my

Royal Malaysian Customs (Jabatan Kastam DiRaja Malaysia, JKDM) 3

Royal Malaysian Customs (Jabatan Kastam DiRaja Malaysia, JKDM) is the

government agency responsible for administrating the nation's indirect tax policy.

JKDM administers seven main and 39 subsidiary laws. Besides this JKDM implements

18 laws for other Government agencies.

Customs duty is a tax levied on imports by Customs to raise state revenue and/or to

protect domestic industries from overseas competitors. In Malaysia, all goods dutiable

on import are put through customs duty according to Customs Duties Order, 1996. The

types of duties are import duty, goods and services tax (replacing the previous sales

tax) and export duty. In other words, the core business of JKDM is to collect tax

revenue in line with the established regulations. JKDM is to collect the tax revenue

efficiently and help the expansion of trade and industry through continuous facilitation

whilst enhancing legal compliance in order to safeguard the nation's economic, society

and security interest.

The principal regulations which comes under the purview of Customs are,

a) Customs Act 1967

b) Goods and Services Tax 2014 (replacing the Sales Tax Act 1972)

3 Royal Malaysian Customs (Jabatan Kastam DiRaja Malaysia, JKDM); http://www.customs.gov.my/

95

c) Excise Act 1976, and

d) Free Zone Act 1990.

Subsidiary regulations known as Customs Orders are formulated and issued to

administer the requirements of these Acts. Box 5.7 gives the list of Customs regulations

currently in force.

Box 5.7: List of Customs Regulations The Gazettes of Acts and subsidiary regulations (titles in Bahasa Malaysia) as listed in Customs Websites (as of 8/1/2015): http://www.customs.gov.my 1. Akta Cukai Jualan 1972 Perintah Cukai Jualan (Pengecualian Pindaan) 2009 2. Akta Cukai Jualan 1972 Perintah Cukai Jualan (Kadar Cukai No.2) (Pindaan No.2)

2009 3. Akta Cukai Jualan 1972 Perintah Cukai Jualan (Kadar Cukai No2) (Pindaan No.3)

2009 4. Akta Cukai Jualan 1972 Perintah Cukai Jualan (Pengecualian Pindahan No.2) 2009 5. Akta Kastam 1967 (Bhg I) 6. Akta Kastam 1967 (Bhg II) 7. AKTA ZON BEBAS 1990 Pemberitahuan Zon Bebas (Pindaan) 2009 8. Akta Zon Bebas 1990 Pemberitahuan Zon Bebas (Kawasan yg Diisytiharkan

(Pindaan) 2009 9. Peraturan Cukai Jualan (Pindaan) 2009 [P.U.(A) 361] 10. Peraturan Cukai Perkhidmatan (Pindaan) 2009 [P.U.(A) 363] 11. Peraturan Perintah Kastam (Pindaan No4) 2009 Pindaan Peraturan 11A 12. Perintah Duti Eksais (Pindaan) 2009 13. Perintah Duti Kastam (Barang Negeri ASEAN) (Tatanama Tarif Berhamonis ASEAN

dan Tarif Keutamaan Samarata)(Pindaan No.3) 2009 14. Perintah Duti Kastam (Barang Negeri-Negeri ASEAN) (Tatanama Tarif Berhamonis

ASEAN dan Tarif Keutamaan Samarata)Pindaan No,4 15. Perintah Duti Kastam (Pengecualian) (Pindaan) 2009 16. Perintah Duti Kastam (Pindaan No.3) 2009 17. Perintah Duti Kastam (Pindaan No.4) 2009 18. Perintah Duti Kastam(Barang-Barang Perjanjian Perkongsian Ekonomi Malaysia-

Jepun) (Pindaan) 2009 19. Perintah Kastam (Duti Anti-Lambakan) 2009 20. Perintah Kastam (Larangan Import) 2009 21. Perintah Kastam (Larangan Mengenai Import) (Pindaan No.2) 2009 22. Perintah Kastam (Larangan Mengenai Import) (Pindaan No.3) 2009 23. Perintah Kastam (Nilai-Nilai Kenderaan Motor Pasang Siap yg Diimport) (Baru

Pindaan) 2009 24. Perintah Kastam (Nilai-Nilai Kenderaan Pasang Siap yg Diimport) (Pindaan Baru

No.2) 2009 25. SENARAI WARTA 2009 (listing of Amendments)

Source: Royal Malaysian Customs; http://www.customs.gov.my

As the sole “gatekeeper” for goods entering and existing the country’s points of cross

border trade, Customs is also responsible for ensuring that the requirements of 18

other laws for the clearance of goods are met. These requirements are implemented

by the Permit Issuance Agencies (PIA). Legitimate documentation, good references

(codes, guidelines, notices, etc.) and strict procedures become the core regulatory

control instruments for Customs clearance of goods into and out of the country. Any

96

inefficiency in Customs operations could become serious bottlenecks in import-export

trade logistics.

Land Public Transport Commission (Suruhanjaya Pengangkutan Awam Darat,

SPAD)

The Land Public Transport Commission (SPAD) was officially established on 3 June

2010 following the enactment of the Suruhanjaya Pengangkutan Awam Darat Act 2010

in May 2010 (Act 714) and the function of SPAD is empowered with the gazetting of

the Land Public Transport Act 2010 (Act 715). Through Act 715, SPAD takes over the

functions of Commercial Vehicles Licensing Board (CVLB), Department of Railways

and licensing of tourism vehicles of the Ministry of Tourism in Peninsula Malaysia. The

Acts and subsidiary legislations under the purview of SPAD are:

a) Land Public Transport Act 2010

b) Suruhanjaya Pengangkutan Awam Darat Act 2010

c) Commercial Vehicle Licensing Board Act 1987

d) Commercial Vehicle Licensing Board (Amendment) Act 2010

e) Land Public Transport (Compounding Of Offences) Regulations 2011.

f) Land Public Transport (Compounding Of Offences) (Amendment)

Regulations 2013.

g) Land Public Transport [Motor Vehicles (Commercial Transport)

(Amendment) Rules 2013] Regulations 2013.

h) Land Public Transport [Motor Vehicles (Commercial Transport)

(Amendment) Rules 2013] Regulations 2014 - Corrigendum.

The function of SPAD covers the drawing up policies, planning, regulating and

enforcing all matters relating to land public transport and for Peninsular Malaysia. Land

public transport covers train, bus and taxi services as well as road- and rail-based

freight transport. SPAD enforcement is carried out in close cooperation with other

enforcement agencies such as the Royal Malaysian Police and the Road Transport

Department4. For the long term, SPAD has developed a 20-year master plan – the

National Land Transport Master Plan in 2012 (currently available for public comment).

The Master Plan has established eight key objectives for freight transport as shown in

Box 8 below.

According to the National Land Transport Master Plan, the strategic objectives of

developing land freight in Malaysia are to increase efficiency and flexibility, strengthen

reliability and to promote safety and social wellbeing. SPAD already has plans to

develop the land freight sector along these objectives. These are:

Strengthening rail infrastructure and strengthening connectivity across

modes, as well as the implementation of city logistics strategies

Enhancing the regulatory framework to raise standards of reliability

4Land Public Transport Commission (SPAD); http://www.spad.gov.my/

97

Enforcing emissions standards and holding both the drivers and operators

accountable for their safety records5.

Box 5.8: Objectives for Freight Transport National Public Transport Master Plan – Eight Objectives for Freight Transport: 1. Competitive framework that strikes a balance between sustainability and reliability 2. Cohesive and rigorous planning of routes and networks, which are diligently reviewed

and regularly updated 3. Implementation of multi-modal integration initiatives and programs, which may include

ports, airports and other points of entry to the LFT network 4. Diligent administration, regulation and monitoring of service standards 5. Coordinated enforcement with relevant authorities on land freight transport matters 6. Coordination and cooperation with relevant authorities to amalgamate land freight

transport planning with spatial matters to achieve cohesive plan 7. Skilled and competent human capital and services in the land freight transport sector 8. Lower environmental impact of land freight transport through reducing omissions of

noise and pollutants, use of technology, and optimal use of resources. Source: SPAD; http://www.spad.gov.my/projects/national-master-plan/final-draft-national-land-public-transport-master-plan-nlptmp

Road Transport Department (Jabatan Pengangkutan Jalan, JPJ) Malaysia

The Road Transport Department (JPJ) Malaysia6 is one of the departments under the

Land Division, Ministry of Transport Malaysia. It is responsible for licensing of vehicles

and drivers and the enforcement of the Road Transport Act 1987 Act 333 to ensure

safe drivers and safe vehicles. Its enforcement activities also include provisions from

the Commercial Vehicle Licensing Act 1987.

There are two primary aspects to JPJ’s regulatory role: safety and revenue collection.

On safety the focus is on the competence of vehicle drivers and the reliability of the

vehicles. Revenue is generated from the collection of road tax and administrative

charges such as fees from licensing, testing and permits issuance. These regulatory

aspects are provided in Act 333 and the various subsidiary legislations and

administrative rules arising from this Act. Act 333’s primary aim is to regulate motor

vehicles, road traffic safely and revenue from the use of public roads. The Act has

various provisions covering:

The regulation of motor vehicles and traffic on the streets and other matters

with respect to streets and vehicles

The protection of third parties against risks arising from the use of motor

vehicles

The coordination and control of the means and facilities for transport

5 SPAD: National Public Transport Master Plan (16 October 2013); http://www.spad.gov.my/projects/national-master-plan/final-draft-national-land-public-transport-master-plan-nlptmp 6 Road Transport Department (Jabatan Pengangkutan Jalan, JPJ) Malaysia; http://www.jpj.gov.my/

98

The coordination and control of the means and facilities for the construction

and adaptation of motor vehicles

Any related purposes on road safety.

To achieve its regulatory responsibility effectively, JPJ has established its primary

objectives as:

To establish and regulate the registration and licensing of motor vehicles in

a systematic, reliable and innovative manner to produce competent, law

abiding and prudent drivers of motor vehicles

To enforce and administer the road transport law with integrity and

commitment to create a society that has a culture of adherence to the rules

of the road

To monitor and administer motor vehicle safety standards with efficiency and

integrity to meet the needs of the environment and the country's automotive

industry.

Permit Issuing Agencies for Cross Border Trading

There are over 20 agencies under 12 different ministries that exercise regulatory

controls on the import and export of controlled goods. Table 5.1 lists the permit issuing

agencies and regulations enforced for international trade. The complete list of other

Government agencies issuing permits, the Permits Issuing Agencies (PIA) is given in

the Appendix.

The regulatory interventions aim at protecting the environment, the biodiversity of the

country, health and safety of the people, local businesses and national security and

sovereignty. Prohibited products such as explosives, arms and dangerous drugs are

subjected to strict controls. Import/export licences and permits are required for various

types of cargo and these can be obtained from various PIA. A general list of these

licences and permits from the different PIA is shown in Table 5.2.

99

Table 5.1: Permit Issuing Agencies Agencies Enforced Regulations

Ministry Of Home Affairs; www.moha.gov.my

Film Censorship and Enforcement Division

Royal Malaysian Police; www.rmp.gov.my

Customs Act 1967

Film Censors 2002 (Act 620)

Explosives Act 1957 (Act 207)

Ministry of Works; www.kkr.gov.my

Construction Industry Development Board; www.cidb.gov.my

Customs Act 1967

Construction Industry Development Board Act 1994 (Act 320)

Ministry of Health; www.moh.gov.my

Pharmaceutical Services Division; www.pharmacy.gov.my

Poisons Act 1952 (Act 366)

Sale of Drugs Act 1952 (Act 368)

Dangerous Drugs Act 1952 (Act 234)

Ministry of International Trade and Industry; www.miti.gov.my

Import and Export Control Section

Trade Cooperation and Industry Coordination Section

Strategic Trade Secretariat

Customs Act 1967

Strategic Trade Act 2010 (Act 708)

Countervailing and Anti-Dumping

Duties Act 1993 (Act 504)

Ministry of Agriculture and Agro-based Industry; www.moa.gov.my

Paddy and Rice Industry Division

Malaysian Quarantine and Inspection Services (MAQIS); www.maqis.gov.my

Department of Veterinary Services; www.dvs.gov.my

Agriculture Department (Pesticides Control Division); www.doa.gov.my

Agriculture Department (Crop Protection and Plant Quarantine Division)

Federal Agricultural Marketing Authority (FAMA); www.fama.gov.my

Customs Act 1967 (Act 235)

Akta Lembaga Kemajuan Ikan Malaysia (LKIM) 1971 (Act 49)

Akta Lembaga Pemasaran Pertanian Persekutuan (FAMA) 1965 (Act 141)

Pesticides Act 1974 (Act 149)

Plant Quarantine Act 1976 (Act 167)

Control of Padi and Rice Act 1994 (Act 47)

New Plant Variety Protection 2004 (Act 634)

Animal Act 1953 (Amendment 2006) (Act 647)

Ministry of Plantation Industries and Commodities

National Kenaf and Tobacco Board;

www.lktn.gov.my

Malaysian Cocoa Board; www.koko.gov.my

Customs Act 1967

National Kenaf and Tobacco Board 2009 (Act 692)

Malaysian Cocoa Board (Incorporation) Act 1988 (Act 343)

Ministry of Science, Technology and Innovations

Atomic Energy Licensing Board; www.aelb.gov.my

SIRIM QAS International Sdn Bhd (Civil and Construction Section); www.sirim-qas.com.my

SIRIM QAS International Sdn Bhd (Communication and Multimedia Certification Section)7

Customs Act 1967

Strategic Trade Act 2010 (Act 708)

Atomic Energy Licensing Act 1984 (Act 304)

Ministry of Natural Resources and Environment

Department of Environment; www.doe.gov.my

Customs Act 1967

Environmental Quality Act 1974 (Act 127)

National Parks Act 1980 (Act 226)

7 SIRIM QAS International Sdn Bhd is a Government-own business entity.

100

Department of Wildlife and National Parks; www.wildlife.gov.my

Ministry of Energy, Green Technology and Water

Energy Commission; www.st.gov.my

Customs Act 1967

Strategic Trade Act 2010 (Act 708)

Energy Commission Act 2001 (Act 610)

Ministry of Information, Communication and Culture

Malaysian Communications and Multimedia Commission (MCMC); www.skmm.gov.my

Customs Act 1967

Strategic Trade Act 2010 (Act 708)

Malaysian Communications and Multimedia Commission Act 1998 (Act 589)

Ministry of Resource Planning and Environment

Sarawak Timber Industry Development Corporation; www.sarawaktimber.org.my

Forest Department Sarawak; www.forestry.sarawak.gov.my

Customs Act 1967

Sarawak Timber Industry Development Corporation Ordinance 1973

Forests (Amendment) Ordinance 2003

Ministry of Modernisation of Agriculture

Department of Agriculture Sarawak (Veterinary Division); www.doa.sarawak.gov.my

Customs Act 1967

Veterinary Public Health Ordinance 1999

Source: MPC compilation

Table 5.2: Import/export Licences and Permits Types of Cargo Permit Issuing Agency

General goods and motor vehicles Ministry of International Trade and Industry

Pesticides Pesticide Board, Plant Protection Section, Department of Agriculture

Animals (domestic) and animal products

Department of Veterinary Services, Ministry of Agriculture Malaysia

Wild animals and corals Department of Wildlife And National Park

Arms and explosives The Royal Malaysian Police

Telecommunication equipment Ministry of Energy, Telecommunication And Posts, Department of Telecommunication Malaysia

Electrical goods Electrical Inspectorate Department Energy Commission of Malaysia

Live fish Ministry of Agriculture Malaysia, Fisheries Department

Pharmaceutical goods Ministry of Health, Pharmaceutical Services Division

Toxic and hazardous wastes Department of Environment

Plants and Plant Products Department of Agriculture Source: Shipping in Malaysia; http://malaysiashipping.info/

Permits are also used to protect local industries, particularly manufacturing, against

practices such as anti-dumping protection. Control is also exercised on strategic trade

items to protect the national interest. The regulation is also meant to facilitate trade

and industry. A document - Certificate of Origin (CO) - to certify the place of growth,

101

production or manufacture of the goods is frequently needed for export of goods by a

country. The CO identifies goods and contains a certification by a government

authority, or other empowered body, that the goods in question originate in a specific

country. The main criteria used in determining the origin of goods are:

Manufacturers, exporters or traders must be registered with Suruhanjaya

Syarikat Malaysia (Companies Commission of Malaysia)

Products that manufactured in Malaysia and use 100% local content, or

Manufactured in Malaysia through a transformation process which changes

the tariff code classification at six (6) digit level, or

Manufactured in Malaysia and contains at least 25% local content

Certificates of Origin can be broadly classified into types, namely Preferential

Certificates of Origin and Non-Preferential Certificates of Origin. The issuance and

acceptance of Certificates of Origin is governed by the International Convention on the

Simplification and Harmonisation of Customs Procedures. Preferential Certificates of

Origin (PCO). The PCOs are used to apply for preferential tariff reduction for products

offered under the Free Trade Agreements (FTA) between Malaysia and partner

countries, provided the rules of origin are fulfilled. The certifying authority for all the

preferential certificates of origin is the Trade Cooperation and Industry

Coordination Section of MITI. Table 5.3 lists the types of PCO available to Malaysian

industries.

To improve the efficiency and capacity for issuance of PCO, MITI appoints chambers

of commerce and trade associations to be issuers of PCO. These intermediaries must

meet the following criteria:

Appointed by Ministry of International Trade and Industry (MITI)

Legally registered under The Registrar of Associations and is not dormant

Membership must not be less than 150 (including members at branch

office)

Fee charged must not exceed the ceiling rate determined by MITI

Sufficient number of staff, office space and equipment for issuing NPCOs8.

There is also a web-based facility for the application of PCO online, the Electronic

Preferential Certificate of Origin or ePCO. This facility is operated by dagangnet.com

(http://www.dagangnet.com/). The application allows manufacturers/ exporters to

obtain the PCO in the form of an official online document.

For agriculture produce, CO is issued by the Federal Agricultural Marketing

Authority, FAMA (http://www.fama.gov.my/). Producers/exporters need to apply using

the CO form from FAMA and submit the form together with the completed Export

Permit Application (PK 2 Form). This can be done FAMA offices (include state offices).

8 MITI - Guidelines On Issuance Of Non-Preferential Certificates Of Origin (06 Sep 2010); http://www.miti.gov.my/cms/content.jsp?id=com.tms.cms.article.Article_bad14748-c0a81573-aba0aba0-215a2171

102

One particular initiative of importance to local exporting industries is the General

System of Preference (GSP). The GSP is a system whereby developed countries

grant preferential treatment to eligible products imported from developing countries, so

that export of developing countries would be competitive in the developed countries

markets. The preference-giving country is also known as the donor country, and the

preference-receiving country as the beneficiary country.

Table 5.3: Types of Preferential Certificates of Origin Type Application

Generalised System of Preference (GSP) Trade document used to obtain reduced or duty free tariffs on eligible products exported by the preference receiving countries to markets of the preference giving countries on the general rates of duty normally applicable.

Preference giving countries are Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Germany, Greece, Norway, Switzerland, Belarus, Russian Federation, Turkey, Finland, France, Hungary, Ireland, Italy, Latvia, Lithuana, Luxembourg, Malta, Netherlands, Poland, Romania, Slovakia, Slovenia, Spain, Sweden and United Kingdom.

ASEAN Trade in Goods and Agreement (ATIGA)

Effective in 1993

ASEAN China Free Trade Agreement (ACFTA)

Fully implemented – July 1, 2005

ASEAN Korea Free Trade Agreement (AKFTA)

Entered into force on June 1, 2007

ASEAN Japan Free Trade Agreement (AJFTA)

Entered into force on February 1, 2009

ASEAN India Free Trade Agreement (AIFTA)

Entered into force on January 1, 2010

ASEAN Australia New Zealand Free Trade Agreement (AANZFTA)

Entered into force in January 1, 2010

Malaysia Pakistan Closer Economic Partnership Agreement (MPCEPA)

Fully implemented – January 1, 2008

Malaysia Japan Economic Partnership Agreement (MJEPA)

Entered into force on July 13, 2006

Malaysia New Zealand Free Trade Agreement (MNZFTA)

Entered into force on August 1, 2010

Malaysia India Comprehensive Economic Cooperation Agreement (MICECA)

Entered into force on July 1, 2011

Malaysia Chile Free Trade Agreement (MCFTA)

Entered into force on February 25, 2012

Malaysia-Australia Free Trade Agreement (MAFTA

Entered into force on January 1, 2013

Source MITI; www.miti.gov.my

The Rules of Origin (ROO) are an essential parts of the GSP scheme in order to

ensure that the benefits of Preferential Tariff treatment under the GSP are confined to

products genuinely produced by or substantially transformed in the preference

receiving countries. Strict enforcement of rules of origins necessary to prevent

products originating from third countries and traded in transit or products which are

only slightly worked upon and do not undergo a true process of manufacture from

103

benefiting under the GSP. The main elements of the rules of origin under the GSP are

(a) origin criteria, (b) consignment conditions, and (c) documentary evidence9.

The regulatory intervention that aims at protecting local industries is anti-dumping.

Dumping is said to occur when goods are exported at a price lower than its “normal

value”. This is deemed an unfair trade practice, particularly when the firms from the

exporting country are suspected selling at subsidised prices, which is deemed to

undermine the competitiveness of local firms. The WTO allows anti-dumping measure

to be applied only under the circumstances provided for in Article VI of GATT 1994 with

pursuant to investigations conducted in accordance with the provisions of this

Agreement10. Malaysia's international rights and obligation in this area are governed

by her membership in the WTO and of the WTO Agreements on Anti-Dumping and

Subsidies & Countervailing Measures.

In Malaysia, there is the Countervailing and Anti-Dumping Duties Act 1993 (Act

504) that empowers the Investigating Authority to take remedial measures against

unfair trading by foreign manufacturers/exporters and to provide a framework for

investigating allegations of injury caused by dumped or subsidized imports. The

Investigating Authority is the Trade Practices Section of MITI.

When a Malaysian domestic industry is of the view that there is evidence of subsidy

and/or dumping and that the subsidy and/or dumping is causing injury, a written petition

may be submitted to commence the process of a countervailing and/or an anti-dumping

action to the Investigating Authority of MITI. Under Act 504, a written petition must be

filed by or on behalf of the domestic industry and should contain sufficient evidence of

dumping (or in the case of a countervailing action, evidence of subsidized imports),

injury and a causal relationship between the dumped (or subsidized) imports and the

alleged injury. In this context the petitioner must be supported by the domestic

producers whose collective output/production constitutes more than 50% of the total

production of the domestic producers expressing either support or opposition to the

petition and the domestic producers expressing support to the petition amount to 25%

of the total production of the domestic industry11.

9 MITI – General System of Preference (17/2/2014);

http://www.miti.gov.my/cms/content.jsp?id=com.tms.cms.section.Section_697f7757-c0a81573-66466646-1561dbc6 10 WTO, Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, Uruguay Round Agreement; http://www.wto.org/

11 MITI, Anti-Dumping and Countervailing Measure (21 Aug 2014); http://www.miti.gov.my/

104

Trade Associations and Chambers of Commerce as Intermediaries

Intermediaries here are the organisations that assist communication and coordination

between the logistics businesses and the regulators. They provide services and/or

build relationships for regulatory compliance and issue resolutions between regulators

and the businesses. These include the trade associations and chambers which

represents the various business communities.

Trade associations and chambers act as go-betweens between the businesses and

the authorities to deal with regulatory and other issues of concern to businesses. The

authorities regularly consult with these bodies on government policies and their

implementation. The trade association intermediaries for the import-export trade

logistics are given in Table 4.6 of Chapter Four. Any regulatory issues arising in the

logistics value chain are communicated and discussed between the respective

associations and the authorities.

Table 5.4: The Key National Business Chambers and Associations Name Address Contact

Associated Chinese Chamber of Commerce and industry Malaysia (ACCIM) www.acccim.org.my

Lot 6.05 & 6.06, 6th Floor, Menara Promet, Jalan Sultan Ismail, 50250 Kuala Lumpur.

Ms.Chong Mon Yee Tel : 03 2145 2503 Email: chongmay@accim.org.my

Federation of Malaysian Manufacturers (FMM) www.fmm.org.my

Wisma FMM, No.3, Persiaran Dagang, PJU 9, Bandar Sri Damansara, 52200, Kuala Lumpur

Shamini Sakthinathan Tel : 03 6276 1211 Email: shamini@fmm.org.my

International Chamber of Commerce Malaysia www.iccmalaysia.org.my/

Wisma FMM No. 3 Persiaran Dagang, PJU 9, Bandar Sri Damansara, 52200 Kuala Lumpur

Tel: +603-62867200 Email: iccm@iccmalaysia.org.my

Malay Chamber of Commerce Malaysia (MCCM) http://www.malaychamber.com

33-35, Jalan Medan Setia 1, Plaza Damansara Bukit Damansara 50490 Kuala Lumpur

Tel : 03-20962233

Malaysian International Chamber and Industry (MICCI) http://www.micci.com/

C-08-08, Plaza Mont'Kiara, 2 Jalan Kiara, Mont Kiara, 50480 Kuala Lumpur, Malaysia

Stewart Forbes Executive Director Tel: +603-62017708 Email : micci@micci.com

National Chamber of Commerce and Industry of Malaysia (NCCIM) http://nccim.cmshosted.net/

MENARA MATRADE, Level 3, West Wing, Jalan Khidmat Usaha, Off Jalan Duta, 50480 Kuala Lumpur

Secretary General Dato Syed Hussein Al Ha Tel: 603-6204 9811 Email: enquiry@nccim.org.my

Malaysian Associated Indian Chambers of Commerce and Industry (MAICCI) http://www.maicci.org.my/

JKR 3190, Jalan Ledang Off Jalan Duta 50480, Kuala Lumpur

Dato' M.Davendran Hon. Secretary General Tel: 603 2011 0478 Email : info@maicci.org.my

Source: Author’s compilation

The exporters and importers or shippers are represented by their associations and

chambers. There are also many other community-based, industry-based, foreign

industry-based associations, both at the national and state levels. The community–

105

based associations representing the three communities are the Chinese, Indian and

Malay Chambers. The Ministry of International Trade and Industry, MITI has a directory

listing of 73 of these entities (includes the Arab, China and German chambers). Table

5.4 is a list of the major local chambers and associations.

Multinational companies and foreign-based industries are also represented by the

country-based chambers. The notable chambers are the American Chamber of

Commerce (AMCHAM), the EU-Malaysia Chamber of Commerce and Industry

(EUMCCI), the Malaysia Australia Business Council (MABC), Malaysian-German

Chamber of Commerce and Industry (MGCC), and the Japanese Chamber of Trade

and Industry, Malaysia (JACTIM). Table 5.5 lists some of the key foreign chambers in

the country. The industry-based associations are many representing the different

industries and trades in the country, such as those representing electrical and

electronics industry, the textile industry, the steel and foundry industry, the automobile

industry, the construction industry, pharmaceutical industry, among others.

Table 5.5: List of Key Foreign Business Chambers in Malaysia Name Address Contact

American Malaysian Chamber of Commerce (AMCHAM) http://www.amcham.com.my

Suite 6-1A, Level 6 Menara CIMB, Jalan Stesen Sentral 2, KL Sentral, 50470 Kuala Lumpur

Jesselynn Lai Government Affairs Manager Tel: +603 2283 3407 Email: jesselynn@amcham.com.my

Arab Malaysian Chamber of Commerce Berhad (AMCC) http://amcc.com.my

Suite 21.02 – 21.03, 21st Floor Menara Haw Par, Jalan Sultan Ismail, 50250 Kuala Lumpur

Carlotta Elena Cawalleri Tel : +(60)3 2078 9990 Email : info@amcc.com.m

British Malaysian Chamber of Commerce (BMCC) http://www.bmcc.org.my

4th Floor, East Block, Wisma Selangor Dredging, 142-B, Jalan Ampang, 50450 Kuala Lumpur,

Tel: +60 3 2163 1784 Email: membership@bmcc.org.my

EU-Malaysia Chamber of Commerce and Industry (EUMCCI) http://www.eumcci.com/

Suite 10.01, Level 10, Menara Atlan, 161B Jalan Ampang, 50450 Kuala Lumpur.

Rozitaayu bt Zulkifli Corporate Communications Manager: Tel: +603-2162 6298 Email: eumcci@eumcci.com

Japanese Chamber of Trade & Industry, Malaysia (JACTIM) http://www.jactim.org.my/

Suite 6.01, 6th Floor, Millennium Office Block, Peti #4, 160, Jalan Bukit Bintang 55100 Kuala Lumpur

Secretary-General TEL (03)2142-7106 E-mail: jactim@jcci.com.my

Kazakhstan-Malaysia Chamber of Commerce http://www.kmcc.com.my/

Box No.43, Level 17, West Block, Wisma Selangor Dredging, 142C, Jalan Ampang, 50450 Kuala Lumpur

Bakhtiyor Abdulloev International Relationships Manager Tel: +603 2181-1676 Email: secretariat@kmcc.my

Malaysia Australia Business Council (MABC) http://www.mabc.org.my/

C-26-3A, 3 Two Square No 2 Jalan 19/1

Shaun Miranda MABC Secretariat Tel: +603 7960 9490

106

46300 Petaling Jaya

Email: shaunmiranda@mabc.org.my

Malaysia Canada Business Council (MCBC) http://www.malaysia-canada.com/

29-5 Jalan PJS 5/30 Pusat Dagangan Petaling Jaya Selatan (PJCC) 4 6150 Petaling Jaya

Natasha Abu Al-Ashari Office Administrator Tel: 603 7785 0799 Email: mcbc@malaysia-canada.com

Malaysia-China Chamber of Commerce (MCCC) http://www.mccc.my

No.8-2, Jalan Metro Pudu, Fraser Business Park, Off Jalan Yew, 55100 Kuala Lumpur

Mr.Ting Chin Ching Tel: +603-9223 1188 Email: sec@mccc.my

Malaysian French Chamber of Commerce and Industry (MFCCI) http://www.mfcci.com/

Unit No. 2B-10-3, 10th Floor, Plaza Sentral, Jalan Stesen Sentral 5, 50470 Kuala Lumpur,

Tel: + 60 3 2035 6970 Email: mfcci@mfcci.com

Malaysian-German Chamber of Commerce and Industry (MGCC) http://www.malaysia.ahk.de/

Suite 47.1, Level 47, Menara Ambank 8, Jalan Yap Kwan Seng 50450 Kuala Lumpur

Ms Cheryl Sim Communications Officer Tel: +60-3-9235 1800 Email: info(at)malaysia.ahk.de

Malaysian Italian Chamber of Commerce and Industry (MITCCI) http://www.mitcci.org.my/

32A, Jalan Ampang, 14M,14th Floor, Plaza Ampang City 50450 Kuala Lumpur

Munindran al Vasuthavan P.R for Asia Tel: 006.03.42566121 Email: mitcci.se@gmail.com

Malaysia New Zealand Chamber of Commerce (MNZCC) http://www.mnzcc.org.my/

Level 21, Menara IMC No. 8, Jalan Sultan Ismail 50250 Kuala Lumpur

Tel: +60 3 2724 0354 Email: mnzcc@mnzcc.org.my

Malaysian Spanish Chamber of Commerce & Industry, (MSCCI) http://www.lacamara.org.my/

20th Floor, Menara Boustead, 69, Jalan Raja Chulan, 50200 Kuala Lumpur

Tel:- (60/3) 2148 7300 E-mail:- info@lacamara.org.my

Source: MPC compilation

Aside from these industry-based associations, there are also services business-based

associations which play a major role in mediation and negotiation with the Government

on logistics matters. A summary listing of many these trade intermediaries is shown in

Box 5.9.

Box 5.9: Summary List of Trade Intermediaries of Logistics Businesses Trade Associations and Chamber of Commerce 1. Airfreight Forwarders Association of Malaysia (AFAM) - www.afam.org.my 2. Associated Chinese Chamber of Commerce and Industry of Malaysia –

www.acccim.org.my 3. Association of Consulting Engineers Malaysia – www.acem.com.my 4. Association of Malaysian Hauliers - http://www.amh.org.my/ 5. Association of Private Hospitals of Malaysia (APHM) - www.hospitals-malaysia.org/ 6. ASEAN Ports Association, Malaysia - http://www.apamalaysia.com 7. Building Materials Distributors Association of Malaysia – www.bmdam.org.my 8. Cement and Concrete Association of Malaysia – www.cnca.org.my 9. Central Region Shipping Association - http://www.crsa.com.my/ 10. Commercial Vehicles Rebuilders Association Malaysia ( CVRAM) -

www.cvramrebuilt.com

107

11. Electrical and Electronics Association of Malaysia (TEEAM) - www.teeam.org.my 12. Federation of Malaysian Consumers Associations (FOMCA) - www.fomca.org.my/ 13. Federation of Malaysian Foundry & Engineering Industries Association of Malaysia –

www.fomfeia.org.my 14. Federation of Malaysian Freight Forwarders – www.fmff.net 15. Federation of Malaysian Manufacturers – www.fmm.org.my 16. Johor Lorry Operators’ Association - http://www.jloa.org.my 17. Machinery & Equipment Manufacturers Association – www.mema.org.my 18. Malay Chamber of Commerce Malaysia – www.dpmm.org.my 19. Malaysia Hardware, Machinery & Building Materials Dealer’s Association (MHMBA) -

http://www.mhmba.org.my 20. Malaysia Steel and Metal Distributors’ Association (MSMDA) -

http://www.metaldealer.org.my/ 21. Malaysian Air-Conditioning & Refrigeration Association (MACRA) -

http://www.macra.org.my/ 22. Malaysian Association of Convention and Exhibition Organisers and Suppliers

(MACEOS) - www.maceos.com.my 23. Malaysian Association of Pharmaceutical Suppliers (MAPS) - www.i-maps.my/ 24. Malaysian Associated Indian Chamber of Commerce and Industry –

www.maicci.org.my 25. Malaysian Automotive Association (MAA) - http://www.maa.org.my 26. Malaysian Employers Federation - www.mef.org.my/ 27. Malaysian Footwear Manufacturers Association (MFMA) -

http://wms2.malaysiafootwear.com/ 28. Malaysia Furniture Entrepreneur Association (MFEA) - www.mfea.org.my 29. Malaysian Gas Association (MGA) - http://www.malaysiangas.com 30. Malaysia Heavy Construction Equipment Owners' Association (PAJPBM) -

http://pajpbm.com/ 31. Malaysian International Chamber of Commerce and Industry – www.micci.com 32. Malaysian Iron & Steel Industry Federation – www.misif.gov.my 33. Malaysian Knitting Manufacturers Association (MKMA) - http://www.mkma.org/ 34. Malaysian Organisation of Pharmaceutical Industries (MOPI) - http://mopi.org.my/ 35. Malaysian Oil & Gas Services Council (MOGSC) - http://www.mogsc.org.my/ 36. Malaysian Palm Oil Association (MPOA) - http://mpoa.org.my/ 37. Malaysian Plastics Manufacturers Association – www.mpma.org.my 38. Malaysian Rubber Glove Manufacturers Association (MARGMA) -

http://www.margma.com.my 39. Malaysian Rubber Products Manufacturers’ Association – www.mrpma.com 40. Malaysian Shipowners’ Association – www.malaysianshipowners.org 41. Malaysian Structural Steel Association – www.mssa.org.my 42. Malaysian Textile Manufacturers’ Association (MTMA) - http://www.fashion-asia.com/ 43. Malaysian Tin Products Manufacturers' Association (MTPMA) -

http://www.mtpma.org.my/ 44. Master Builders’ Association Malaysia – www.mbam.org.my 45. Metal Dealers’ Association – www.metaldealer.org.my 46. National Chamber of Commerce and Industry of Malaysia -

http://nccim.cmshosted.net/ 47. National ICT Association of Malaysia (PIKOM) - http://www.pikom.org.my/ 48. Palm Oil Refiners Association of Malaysia (PORAM) – http://poram.org.my 49. Pan-Malaysia Lorry Owner’s Association (PMLOA) 50. Pharmaceutical Association of Malaysia (PhAMA) - www.phama.org.my/ 51. Persatuan Insurans Am Malaysia (PIAM) - http://www.piam.org.my/ 52. Real Estate and Housing Developer’s Association Malaysia – www.rehda.com 53. SME Association Malaysia - www.smemalaysia.org/ 54. Sabah Timber Industries Association (STIA) - http://www.stia.com.my

108

55. Sarawak Chamber of Commerce and Industry (SCCI) - http://www.scci.org.my 56. Sarawak Timber Association (STA) - http://www.sta.org.my/ 57. Shipping Association Malaysia (SAM) - http://www.sam.org.m 58. Steel Wire Association of Malaysia – www.swam.org.my 59. Timber Exporters' Association of Malaysia (TEAM) - http://www.team.org.my

Source: Author’s compilation (also from Malaysian Spanish Chamber of Commerce & Industry; http://www.lacamara.org.my/)

Government Intermediaries

The country’s external trade has been expanding continuously over the last three

decades. As such, the demand on government services also increases annually. To

cope with business demands and constraints on government capacity expansion, the

government outsources some of its functions, by privatising specific government

functions, setting up or appointing a private and commercial entity to run the

outsourced function. These entities are monopolistic outsourced service providers.

In the case of Customs, the online customs clearance activities have been

outsourced to a company Dagang Net Sdn. Bhd. which is an e-commerce service

provider. Dagang Net has performed over 275 million electronic transactions and

RM1.8 billion worth of Customs duty payments and serves more than 5000

customers12.

The road transportation authority – Department of Road Transport Malaysia

(Jabatan Pengangktan Jalan, JPJ) - has outsourced vehicle inspection to a private

company PUSPAKOM Sdn. Bhd. (http://www.puspakom.com.my). Established in

1994, PUSPAKOM is a wholly-owned subsidiary of DRB-HICOM Bhd., a conglomerate

that is listed on the Kuala Lumpur Stock Exchange. It is the only vehicle inspection

company appointed by the Malaysian Government to undertake all mandatory

inspections for commercial and public vehicles, as well as private vehicles for hire-

purchase financing, ownership transfer and insurance purposes13.

As the individual authorities have serious limitations in both capability and capacity in

managing ICT systems and applications, many electronic data processing functions

are outsourced to a privately incorporated entity, MYEG. MY E.G. Services Bhd.,

MYEG is a concessionaire for Malaysian Electronic-Government (e-Government)

MSC Flagship Application. MYEG builds, operates and owns the electronic channel to

deliver services from various Government agencies to Malaysia citizens and

businesses. MY E.G. Services Bhd. was incorporated in Malaysia as a private limited

company on 17 February 2000 as I.T. Marvel Sdn. Bhd.

The e-Government Initiative is a Government programme which focuses on delivering

improvements of Government internal operations and its service delivery. The initiative

12 Dagang Net Sd. Bhd. (February 2015), About Us - Commerce the Dagang Net Way; http://www.dagangnet.com/index.php/about-us/about-us.html 13 PUSPAKOM Sdn. Bhd.; http://www.puspakom.com.my

109

focuses on allowing citizens to retrieve information and perform transactions with

various service suppliers in a convenient and timely manner by utilizing its Electronic

Services (e-Services)14.

The Logistics Businesses

Freight forwarders play an important role in the logistics chain as they manage the

transportation of goods across the globe for exporters and importers. They provide the

services that ensure goods, to be moved, meet all necessary conditions to pass

through customs and that all the necessary paperwork is in order, as well as ensuring

that goods are properly handled. These are firms specializing in arranging storage

shipping of merchandise on behalf of its shippers. It usually provides a full range of

services including: tracking inland transportation, preparation of shipping and export

documents, warehousing, booking cargo space, negotiating freight charges, freight

consolidation, cargo insurance, and filing of insurance claims.

In Malaysia, the freight forwarding business is represented by geographically-located

associations affiliated to the national Federation of Malaysian Freight Forwarders15

(see Box 10). These geographically-located associations are:

i. Selangor Freight Forwarders and Logistics Association, SFFLA - 589

company members; http://www.sffla.com/

ii. Johor Freight Forwarders Association, JOFFA - 241 company members;

http://joffa.net/

iii. Penang Freight Forwarders Association, PFFA - 115 company members;

http://pffa.org.my/

iv. Kota Kinabalu Forwarding Agent Association, KKFAA - 52 company

members.

v. Sarawak Forwarding Agencies Association, SFAA - 84 company

members; http://sfaa.ent.my/

vi. Labuan Freight Forwarders Association, LFFA - 10 company members.

As can be seen the Selangor Freight Forwarders and Logistics Association,

SFFLA, which is based in Klang is the largest in the region as Port Klang remains the

largest port in Malaysia. The association was formed and registered in 14th June 1973

under the Societies Act 1966. Initially, the name of the association was "Association of

Forwarding Agents Port Klang" and in May 2003 the association changed its name to

SFFLA. SFFLA mission is to promote its members’ activities (upstream businesses)

and to enhance the awareness of Port Klang as the premier port in Malaysia, promoting

14 MY E.G. Services Bhd, MYEG; https://www.myeg.com.my 15 Federation of Malaysian Freight Forwarders; http://www.fmff.net/

110

the services and incentives available in the port and promoting more activities for the

business community and logistics players (downstream businesses)16.

Box 10: Federation of Malaysian Freight Forwarders

FMFF was registered in September 1987 as a National Association representing the

Freight Forwarders in the logistics industry. In 2000, the Ministry of Transport endorsed

and recognized FMFF as a national Association to represent the logistics industry.

Current membership in FMFF nationwide is about 1091 members with several applicants

pending approval. FMFF membership as per State association is as follows’-

Selangor Freight Forwarders and Logistics Association, SFFLA - 589 company

members.

Johor Freight Forwarders Association, JOFFA - 241 company members.

Penang Airfreight Forwarders Association, PFFA - 115 company members.

Kota Kinabalu forwarding Agent Association, KKFAA - 52 company members.

Sarawak Forwarding Agencies Association, SFAA - 84 company members.

Labuan Freight Forwarders Association, LFFA - 10 company members.

FMFF is affiliated to FIATA (International Federation of Freight Forwarders Association),

AFFA (ASEAN Freight Forwarders Association), FAPAA (Federation of Asia Pacific Air

Cargo Associations, MNSC (Malaysian National Shippers Council).

FMFF participates in many government forums such as Dialogues with MITI and MOF,

Customs Liaison meeting, MOT, MLC, Trade and Facilitation Action Council (MITI) and

provides industry views and inputs for policy makers’ consideration.

FMFF was established in 1987 as a National Association with the following objectives:-

To unify all freight forwarders in the country through the promotion of co-operation

and understanding among members

To protect and represent the interests of members at the National and International

levels.

To improve the quality and standards of services of members through information

and data exchange, documentary simplification systems and organisational

development and internationalisation.

To establish, maintain and promote ethical standards within the profession.

To arbitrate in the settlement of disputes and difficulties arising between members.

16 Selangor Freight Forwarders and Logistics Association; http://www.sffla.com/

111

To foster the growth and awareness of freight forwarding through appropriate

publications and promotions.

To foster and improve relations with shippers, carriers, governmental bodies and

other related and interested parties.

To provide for vocational training at the national level.

Source: Federation of Malaysian Freight Forwarders (16/2/15), http://www.fmff.net/

Hauliers are persons or companies employed in the transport of goods or materials

by road. Trucks carry the major volume of the freight tonnage moved in the country,

maybe as much as 80 per cent. With industry relying this heavily on road carrier

transport, changes and efficiency in the trucking industry can have major ramifications

for shippers. Shippers need to be aware of truck-related regulation and legislation.

These regulations and how they are implemented can influence how shippers and their

road carriers do business together. The road carrier transport business is represented

by two main trade associations in Malaysia, (a) Association of Malaysian Hauliers,

AMH and (b) Johor Lorry Operators’ Association, JLOA.

Ports Authorities and Ports Operators: Ports and shipping are major links in the

logistics chain and are essential in facilitating trade in Malaysia and hence crucial to its

economic prosperity. On this, the country’s ports have assumed a critical role in the

overall pattern of trade and transport, providing a link between the shipping service

and the inland transport system. Today, with world-class facilities, Malaysia’s ports act

as crucial points of interface with other transport modes - road, rail, river and air.

In 1987, the Economic Planning Unit (EPU) in the Prime Minister’s Department

commissioned a study and drew up a blueprint for a national port policy. Outlining

recommendations and action plans to enhance the growth and development of

Malaysia’s ports, it set the pace for rapid port development. Central to the policy was

port privatization and the establishment of a national load centre featuring modern

terminal facilities and large cargo volumes to attract large container vessels.

Prior to the enactment of the Port (Privatisation) Act 1990, Act 422, ports in the country

were operated by Port Authorities. With the advent of the Act 422 the major ports in

the country were privatized and these entities are regulated by their respective Port

Authorities. Table 5.6 shows the privatised major sea ports. Ports in the country are

either under the purview of the Federal Government or the State Government. Those

administered by the Federal Government, under the jurisdiction of the Ministry of

Transport, can be categorized into major and minor ports. The major Federal ports are

112

Port Klang, Penang Port, Bintulu Port, Kuantan Port, Kemaman Port, Johore Port and

Tanjung Pelepas Port, all regulated by port authorities.

In addition, there are around 80 minor ports or jetties under the regulation of the Marine

Department. The ports in Sabah are governed by Sabah Ports Authority, while

Sarawak has three separate port authorities supervising the ports in Kuching, Rajang

and Miri.

Table 5.6: Major Sea Ports under the Port (Privatisation) At 1990 Penang Port Penang Port Commission Penang Port Commission Act 1955

Port Kelang Kelang Port Authority Port Authorities Act 1963

Kuantan Port Kuantan Port Authority Port Authorities Act 1963

Pasir Gudang Johore PortAuthority Port Authorities Act 1963

Bintulu Port Bintulu Port Authority Bintulu Port Authority Act 1981

Malacca Port Malacca Port Authority Port Authorities Act 1963

Kemaman Port Kemaman Port Port Authorities Act 1963

Tanjung Pelepas Port

Johor Port Authority (Tanjung Pelepas)

Port Authorities Act 1963

Source: Act 422, Schedule (Section 2)

The largest seaport in the country is Port Klang, serving the Klang Valley which is the

most well-developed and industrialized region in Malaysia. For its strategic location, it

is designated as the load centre for both local and regional containers to generate

critical mass at one port making it an attractive destination for Main Line Operators.

This has resulted in the diversion of cargo from other ports to Port Klang, which handles

sixty over per cent of Malaysia’s container trade and is a major regional distribution

and transhipment hub17. It is the world’s 13th largest container port18, handling

10,350,409 twenty-foot equivalent units (TEU) out of the total of 20,876,442 TEU

handled in the county in 2013. This represent almost 50 per cent TEU handled in the

country. Port Klang has two of its terminals, operated by two companies, Westports

Malaysia Sdn. Bhd. (www.westportsmalaysia.com) and Northport (Malaysia) Bhd.

(www.northport.com.my), together both boast of world-class facilities that can cater to

the world's largest ships and have trade connections with more than 500 ports around

the world.

Port of Tanjung Pelepas (PTP), Malaysia's transhipment port at the southern tip of

Peninsular Malaysia, began operations in 1999 but has grown spectacularly to

become the 20th largest container port in the world (2015). As the trans-shipment hub

for the southern region, PTP achieved an annual cargo volume of 7.63million TEUs in

17 Nazery Khalid (2005), The Development of Ports and Shipping Sector in Malaysia,Marine Institute of Malaysia (MIMA) 18 World Shipping Council (2015), Top 50 World Container Ports; http://www.worldshipping.org/about-the-industry/global-trade/top-50-world-container-ports

113

2013. PTP has attracted two of the world’s largest container service operators,

Moller-Maersk and Evergreen, to become its shareholders. The port operator is

Pelabuhan Tanjung Pelepas Sdn. Bhd. (www.ptp.com.my/)

Johor Port was established in 1977 and features diverse cargo, storage and logistics

facilities. It enjoys a strategic location in a busy transport hub in the south-eastern tip

of Peninsular Malaysia, attracting major carriers such as Evergreen, Wan Hai and

PIL. The port operator is Johor Port Bhd. (www.johorport.com.my)

Penang Port, the gateway port to Peninsular Malaysia’s northern region, is an

established port serving one of the region’s busiest trade routes. The port serves as

the main gateway for shippers in the northern states of Malaysia and also the southern

provinces of Thailand. Penang Port is well connected with land and air modes and is

accessible to and from all the major economic regions in Peninsular Malaysia. The port

operator is Penang Port Sdn. Bhd. (www.penangport.com.my Penang Port is the

oldest and longest established port in Malaysia. Capable of handling 25 million tons of

cargo annually, it enjoys connectivity with over 200 ports worldwide. Penang Port is

fully equipped to handle all types of cargo such as containers, liquid, dry bulk, break

bulk and others and provides a multitude of services to cater for their safe and efficient

transit via the port’s various terminals and facilities.

Kuantan Port serves the Eastern Corridor of Peninsular Malaysia stretching from

Kelantan to Pahang, focusing on the cluster of international chemical plants in the

Gebeng Industrial Estate. As such, its port facilities feature palm oil berths, liquid

chemical berths, mineral oil berths and a MTBE (methyl tertiary butyl ether) terminal.

The port operator is Kuantan Port Consortium Sdn Bhd (KPC); http://www.ijm.com/

KPC is jointly owned by IJM Corporation Berhad and Beibu Gulf Holding (Hong Kong)

Co. Ltd on a 62:38 equity holdings with the Government of Malaysia having a special

rights share. KPC is given the concession period of thirty years since 1998 to manage,

operate and develop Kuantan Port. With the development of the New Deep Water

Terminal (NDWT) a new Privatisation Agreement shall be entered for a period of thirty

years. Kuantan Port is an all-weather port and a multi-cargo deep sea port facing the

South China Sea. Strategically located on the eastern seaboard it serves the industrial

and the petrochemical industries in the East Coast Industrial Corridor. Supported and

has a vast market outreach and a strong network of global shipping connections.

Kemaman Port is located on the East Coast of Peninsular Malaysia, serving the steel

plants, crude oil terminals, gas processing plants, refineries and petrochemical

complexes. The facilities at this port, one of the deepest seaports in Malaysia and the

gateway to the Asia-Pacific region, include three multipurpose berths, one liquid

chemical berth and one LPG export terminal. It is also a supply base catering to the

needs of petroleum companies operating off the shores of Terengganu.

114

Bintulu Port, located on Sarawak’s north-eastern coast, is the only export gateway for

the country’s biggest export earner – liquefied natural gas (LNG) produced off the

Bintulu coast. Commencing operations in 1983 and privatised in 2001, its facilities

include an LNG terminal, LPG jetty and a new dedicated container terminal equipped

with the latest and most modern port equipment and other supporting facilities. It is

recognised as the world’s largest single LNG port featuring three LNG jetties capable

of handling up to 25 million tons per year.

Also in Sarawak there are two riverine ports, Kuching Port and Miri Port, which serve

the southern and northern part of the state respectively. As for Sabah, The Sabah

ports deal mainly with exports of timber, petroleum-based products, palm oil, cocoa

beans, rubber and mineral oils. These cargos are moved via the seaports at Kota

Kinabalu, Sepanggar Bay, Sandakan, Tawau, Lahad Datu, Kudat, Kunak and Labuan,

all accessible to international shipping. A new container terminal at Sepanggar Bay will

handle the whole of state’s container operations except for general cargo.

All these ports and their respective Port Authorities are members of the ASEAN Ports

Association Malaysia with the aim of fostering friendship and extending support and

cooperation to promote the interest of ports. The founding members of ASEAN Port

Association (APA), originally known as the ASEAN Port Authorities Association,

consist of government agencies in the ASEAN countries, which are recognized and

functioning either as a corporate body or as a bureau. The Port of Singapore Authority,

Indonesia Port Corporations, Kelang Port Authority (Malaysia), Port Authority of

Thailand and Philippine Ports Authority function as corporate bodies19.

Warehousing: A warehouse is a storage place for products. Principal warehouse

activities include receipt of product, storage, shipment, and order picking. Managing

warehouses efficiently ensures that goods flow from the manufacturers or producers

to consumers in without interruptions and undesirable delays. These days, seller of

goods generally outsource warehousing function to third parties - Third Party

Warehousing. A good Warehouse Management System (WMS) is crucial to efficient

warehousing. The WMS is used in effectively managing warehouse business

processes and direct warehouse activities, including receiving, put-away, picking,

shipping, and inventory cycle counts. WMS will have support of radio frequency

communications, allowing real-time data transfer between the system and warehouse

personnel. It will also maximize space and minimize material handling by automating

receiving and put-away processes20.

Warehousing is an important elemental link in the logistics chain. Although the main

function is storage and distribution, to ensure cost efficiency of the logistics chain,

warehousing also functions as repacking and packaging, goods receiving and

stocking, processing shipments, picking and consolidating, regulatory inspections,

19 ASEAN Ports Association Malaysia; http://www.apamalaysia.com/ 20 Inbound Logistics, Glossary of Supply Chain Terms; http://www.inboundlogistics.com/cms/logistics-glossary/

115

tariff assessment and customs clearance, and so forth. Warehousing remains a cost

function and as such its functional efficiency is crucial to logistics.

Some countries have special Acts for warehousing such as the Uniform Warehouse

Receipts Act21 that sets forth the regulations governing public warehousing. The

regulations define a warehouse manager's legal responsibility and define the types of

receipts he or she issues. There is no such Acts in Malaysia but warehouses are

government under the Street, Drainage and Building Act 1974, Act 133, which covers

the construction and use of the structure. As for warehousing operation, there are

different regulations and authorities governing them depending of the types of goods

handled. For general goods or consumer goods, governance is generally through the

Ministry of Domestic Trade, Co-operatives and Consumerism (MDTCC).

For drugs and pharmaceuticals, the storing, handling, distributions, labelling and

packaging, traceability and re-calling among others are govern by the Pharmaceutical

Services Division of the MOH. The MOH also has various guidelines such as the Good

Manufacturing Practices (GMP) and Good Distribution Practices that industries need

to follow.

Dangerous goods and radioactive materials are strictly regulated and the governing

authorities include the Department of Safety and Health (DOSH), the Atomic Energy

Licensing Board (AELB), the Fire & Rescue Department of Malaysia (BOMBA) and the

Department of Environment Malaysia (DOE).

There are also warehouses under the direct control of Royal Malaysian Customs, such

as the Licensed Manufacturing Warehouse (LMW), which is a premise licensed

under section 65A of the Customs Act 1967. It is control by way of documentation and

subject to all customs rules and regulations. Licensed manufacturing warehouse is a

facility provided for export oriented companies too22.

Warehouses located in the free zones are governed by the Free Zone Act 1990. A

free zone is a designated, secured area in which commercial and industrial activities

are carried out and gazetted by the minister of finance as stated under the section 3(1)

Free Zone Act 1990. There are two types of free zone that is the free industrial zone

(FIZ) and free commercial zone (FCZ). Free Zone Authority is appointed by the

minister under section 3(2) of the Free Zone Act 1990 to manage the zone. Customs

control at the free zone is at the minimum and basically only at the gate point. FIZ is a

place where most of the manufacturing activities carried out are for export purpose. It

is a facility meant for export-orientated companies. Besides that, FIZ can also carry out

other activities such as evaluation, testing of goods, research, designing etc.

21 Warehouse Receipts Act, Victoria, British Columbia, Canada; http://www.bclaws.ca/civix/document/id/complete/statreg/96481_01 22 Royal Malaysian Customs (Draft as at 5 January 2014), Goods and Services Tax, Guide on free Industrial Zone and Licensed Manufacturing Warehouse; http://gst.customs.gov.my/en/rg/SiteAssets/industry_guides_pdf/Bi%20FIZ%20and%20LMW%20-%20271013_to%20upload5.1.14.pdf

116

Another type of warehouse located in a designated area and approved by the Royal

Malaysian Customs (RMC) under Section 65 of the Customs Act 1967, for storing

dutiable goods is the bonded warehouse. Since 1981, its function has been enhanced

for other activities such as break bulking and trading to facilitate commercial activities

as well as to make it a distribution hub within the ASEAN region. Its creation also

helped to reduce port congestion and for convenience of the importers23. Warehouses

are generally third party warehouses serviced by logistics companies. Some freight

forwarders also manage warehouses largely for receiving, put-away and consolidating

functions. Interested parties can contact trade associations representing freight

forwarders, hauliers and lorry for information on relevant logistics service providers.

Other intermediaries for logistics and warehousing include msialogistic.com which is

under the Marshall Cavendish Business Information Private Limited and a member of

Times Publishing Group. As a leading publisher of niche industry directories, it

publishes more than 40 trade directories annually covering a wide spectrum of key

industries. Its website http://www.msialogistics.com/ is a good search engine for

logistics providers in Malaysia. Another intermediary which is useful for searching is

the Alibaba.com http://www.alibaba.com/countrysearch/MY/logistic-service.html. The

search engine can locate most logistics service providers in the country.

Conclusion

This chapter gives the overview of the key stakeholders in sea freight logistics. The

Ministry of Transport oversees all aspects of the country logistics covering the

development of the logistics economy and infrastructure to the regulation and

enforcement of established regulators. The importation and exportation of goods are

governed by many regulations depending on the types of goods. The Royal Malaysian

Customs has the role as gatekeeper for all goods traded across the country’s borders

through the various ports, airports and border crossings. Some of the regulatory

activities have been outsourced to improve efficiency of regulatory enforcement.

The key stakeholders in the logistics chain are the importers and exporters (shippers)

and the logistics services providers. The shippers who comprise manufacturers and

goods traders are those involves in trading of goods across the national borders. Most

of these businesses have established trade associations and chambers to represent

their voice to the Government on regulatory, policy and other economic issues.

23 Royal Malaysian Customs (Draft as at 27 October 2013), Goods and Services Tax, Guide on Warehousing Scheme

117

Appendix

LIST OF THE 26 OGAS ISSUING PERMITS (also known as PIAs)

1. Film Censorship & Enforcement Div., Min of Home Affairs (MOHA)

2. Royal Malaysia Police, MOHA

3. Construction Industry Development Board, Min of Works

4. Pharmaceutical Services Div., Min of Health

5. Import & Export Control Sec., Min of International Trade & Industry (MITI)

6. Trade Cooperation & Industry Coordination Sec., MITI

7. Strategic Trade Secretariat, MITI

8. Paddy & Rice Industry Div., Min of Agriculture (MOA)

9. Malaysian Quarantine & Inspection Services, MOA

10. Department of Veterinary Services (MOA)

11. Department of Fishery, MOA

12. Pesticides Control Div., Dept. of Agriculture (DOA)

13. Crop Protection & Plant Quarantine Div., DOA

14. Federal Agriculture Marketing Dept., MOA

15. Malaysian Pineapple Industry Board, MOA

16. National Kenaf & Tobacco Board, Min of Plantation Industries (MOPIC)

17. Malaysian Cocoa Board, MOPIC

18. Atomic Energy Licensing Board, Min of Science, Tech & Innovations (MOSTI)

19. Civil & Construction Sec., SIRIM

20. Communication & Multimedia Certification Sec., SIRIM

21. Dept. of Environment (DOE), Min of Natural Resources & Environment

(MONRE)

22. Dept. of Wildlife and National Parks, MONRE

23. Energy Commission, Min of Energy, Green Tech & Water (MOEGTW)

24. Malaysian Communications & Multimedia Commission (MCMC), Min of

Information, Communication and Culture (MOICC)

25. Sarawak Timber Industry Development Corporation, Min of Resource Planning

and Environment, Sarawak

26. Forest Department, Sarawak

27. Veterinary Div., Department of Agriculture, Sarawak.