Submission No 7
Inquiry into Australia’sRelationshipwith Malaysia
Organisation:
Contact Person:
Address:
Department of Communications, InformationTechnology and the Arts
Helen WilliamsSecretary
GPO Box 2154Canberra ACT 2601
Joint Standing Committee on Foreign Affairs, Defence and TradeForeign Affairs Sub-Committee
Australian GovernmentDepartment ofCommunications,
lidormation Technologyand the Arts
Secretaryour reference
Helen Williams AO
Dr Margaret KerleyThe SecretaryJoint StandingCommitteeonForeignAffairs, DefenceandTradeParliamentHouseCANBERRA ACT 2600
Email: lijadt(&ahu0¼au
DearDr Kerley
Inquiry into Australia’s Relations with Nialaysia
I am pleasedto he ableto offer theattacheddepartmentaloftheCommittee. The submissionprovidesanoverviewMalaysiain theDepartment’sareasofinterest.
submissionfor the infonnationofbilateral relationswith
A first point ofcontactin theDepartmentis Mr TrevorWykes.Manager.CoordinationUnit (62711921,Trevor.Wykes®dcita.govauX
Yours sincerely
4 aiD&~
Helen Wifliams
•1 7
GPO Box 2154 Canberra ACT 2601 Australia• teiephone 026271 1872 • facsmde 02 ~271 1077emad helenwiUiarns@dcitagovau website http://w~wdcita~ov au
Department of Communications,Information Technologyand theArts
SubmissiontoJoint Standing Committee of Foreign Affairs, Defenceand Trade
Inquiry into Australia’s Relationshipwith Malaysia
Thefollowing is submittedby theDepartmentofCommunications,InformationTechnologyand theArts (DCITA), providingan overviewofbilateralrelationswithMalaysiain theDepartment’sareasof interest.
INTRODUCTION
DCITA hasstronglinks with theMalaysianGovernmentthroughtradenegotiations,APEC, Asia Pacific Telecommunity(APT) andtheinternationalTelecommunicationUnion (ITU).
Malaysiais Australia’sninthlargesttradingpartner,with computersandtelecommunicationsequipmentamongstMalaysia’stop exportsto Australia.Australiantelecommunicationscompaniesalsohaveakeeninterestin theMalaysiantelecommunicationsmarket.
DCITA is involved in tradenegotiationswith MalaysiathroughtheMalaysia-AustraliaFreeTradeAgreement(MAFTA), theASEAN-AustraliaandNew ZealandFreeTradeAgreement(AANZFTA) andtheWorldTradeOrganisation(WTO).
DCITA’s role is to provideexpertadvicein supportoftradenegotiationsto:
• ensuremarketaccessandregulatorycertaintyfor Australiantelecommunicationscompaniesin foreignmarkets;
• promotetheuseofelectroniccommerce(e-commerce)to enhanceoveralltrade; and
• safeguardAustralia’scultural andsocialpolicy objectives,including thoserelatedto audio-visualmedia.
DCITA’s Malaysiancounterpartagencyfor communicationspolicy is theMinistryofEnergy,WaterandCommunications(MEWC). MEWC providespolicy adviceon allaspectsof communicationspolicy, includingtelecommunications.TheMinistry ofScience,TechnologyandInnovation(MOSTI) is responsiblefor informationandcommunications(ICT) including, ICT policy, research,developmentandcommercialisationof ICT andthedevelopmentofICT industries.
In additionto its participationin tradenegotiationsandinternationalfora, DCITA isdiscussingapossibleMemorandumofUnderstanding(MOU) on informationandcommunicationstechnology(ICT) cooperationwith theMalaysianMinistry ofScience,TechnologyandInnovation(MOSTI). TheobjectiveoftheMOU wouldbeto complementthefree tradeagreementnegotiationsbetweenAustraliaand Malaysiaby advancingthegrowthofinvestment,joint ventures,joint initiativesin R&D andtechnologydevelopmentin theICT sector.
Malaysian TelecommunicationsMarket
Malaysiais aimingto reachdevelopedcountrystatusby 2020. TheGovernmentofMalaysiahasrecognisedtheimportanceoftheICT sectorandits further liberalisationin achievingthis goal. MEWC recentlyreleasedambitiousplansto upgrade,improveaccessto andmanagetheintroductionofnewICT technologiesfor theperiod2006-2010 in theMalaysianInformation,CommunicationsandMultimedia Services886Strategy(MYICMS 886).
TheMalaysiantelecommunicationsmarketis changingrapidly. As aresultthestatisticsregardingmarketpenetrationof varioustechnologiesarealsochangingrapidly. Thosepresentedhererepresentthemostrecentfigurescurrentlyavailable.
Malaysia’sincumbenttelecommunicationscompany,TelekomMalaysia(TM), wasprivatisedin 1990. TheMalaysianGovernmentretainsa45%stakein thecompany.TM is Malaysia’sdominanttelecommunicationscarrierprovidingfixed-line, mobileanddata(internet)services.
Malaysia’sfixed-lineservicesaredominatedbyTM which coversaround99•5%l ofthemarket. However,thepenetrationoffixed-linesis decliningfrom ahigh of19.7linesper 100 inhabitantsin 2000to its currentlevel of 16.4 linesperhundredinhabitants2andis expectedto dropbelow 15%by 20l0~. In comparison,at theendof2004Australia’sfixed-linepenetrationratewas55.8 linesper 100 inhabitants4.
Mobile penetrationin Malaysiais around77,7%5andcontinuesto growrapidly—
mobilephonepenetrationgrewby over 30%in 2004and2005. ThedominantcarnersareMaxis Communications,with 40.2%6ofthemarketshare,Celcom(fullyownedby TM), 35.2%~,andDiGi Telecommunications,24.6%~. MaxisCommumcationsandCelcomboth hold 3G(third-generationmobile) licences.Bothcompanieshave3G networkswhich theyarecontinuingto expand.MiTVCorporation,apay-TV operator,andIT dotComweregranted3Glicencesin March2006while DiGi wasrefusedalicence. Both MiTV and ‘PT dotComplanto buildtheirown 3Gnetworks.
At theendof 1995,Malaysiahadaround55,oo& 3G subscribers.TheMalaysianGovernmentviewsthegrowthof3G servicesascritical to its ICT strategyasa meansofprovidingvoice, videoandhigh-speeddataservices. Its recentlyreleasedICTgoalsfor theperiod2006-2010includedtheobjectiveof300,0003Gsubscribersbytheendof 2006growingto 5 million subscribersby201010.
BusinessMonitor InternationalMalaysiaTelecommunicationsReportQI 20062 MalaysianCommunicationsandMediaAuthority website
BusinessMonitor InternationalMalaysiaTelecommunicationsReportQI 2006BusinessMonitor InternationalAustraliaTelecommunicationsReportQI 2006MalaysianCommunicationsandMedia Authoritywebsite
6 BusinessMonitor InternationalMalaysiaTelecommunicationsReportQi 2006~Ibid~IbidIbid
10 MalaysianInformation,CommunicationsandMultimedia Services886 Strategy(MYICMS 886)
Malaysiacurrentlyhasadial-upinternetpenetrationrateofaround13.9%andabroadbandpenetrationrateof2.17%lI. Around94%ofbroadbandsubscribersuseADSL services.Dial-up andbroadbandpenetrationrateshavebothbeengrowingsteadily,but takeup will ultimatelybelimited by thelow fixed-linepenetrationratesin Malaysiaasbothservicesaredeliveredthroughthefixed-linenetwork. Malaysiahasreleasedambitiousplansto increasetakeup ofwirelessandoptical fibre-basedinternetservices. It is currentlyconsideringtheinclusionof broadbandservicesin itsUniversalServicesregimeandtheintroductionof a Fibre-To-The-Homenetworkwith agoalof 75%broadbandpenetrationto householdsby 201012•
Multimedia Super Corridor
In 1996MalaysiaestablishedtheMultimedia SuperCorridor (MSC). TheMSC isdesignedto be an ICT centrecovering5 ‘cyber cities’. Companieswhichmeetaspecifiedsetofcriteria,includingestablishmentin theMSC zone,aregiven‘MSCMalaysiaStatus’andarecoveredby a Bill of Guaranteeswhich includes:ICTinfrastructurelevel guarantees,no limitations on thenumberof foreignknowledgeworkers,no foreignequity limitations, tax andotherfinancialincentives,greaterIPprotectionanduncensoredinternetaccess.TheMSC is designedto attractforeignandlocal capitalandprovidesan areafor theMalaysianGovernmentto trial newICTpolicy. Around 1200Malaysianandforeign companiescurrentlyhaveMSC MalaysiaStatus. TheMSC is managedby theMultimedia DevelopmentCorporation.
Multimedia SuperCorridor: CreativeMultimedia ContentInitiative (DigitalContent)
In launchingtheMultimedia SuperCorridor(MSC) Malaysia:CreativeMultimediaContentInitiative on 7 April 2006,thePrimeMinisterof Malaysia,Yab Dato’ SeriAbdullahBin Haji AhmadBadawi, announced:
“In the9th MalaysiaPlan (providingthevisionfor developmentto 2020),thecreativemultimediacontentindustry, which includescreativecomputeranimation,digital games,mobileapplicationsandservices,interactiveiv,edutainment,digital productionanddigital archives,hasbeenearmarkedto bedevelopedasa newengineofgrowth.
Themain objectiveofthis initiative is tofurther developthecreativemultimediaindustryandcreatea contentclusterthat contributesto economicgrowth andspearheadtheuseoftechnology.With this, contentthat is createdcan be adoptedto absorblocalflavours.Someoftheexamplesinclude: increasingcontentinbahasamalaysiaandother local languayesanddialectsaswell as increasingcontentthatis relevantto our society.
I MalaysianCommunicationsandMediaAuthoritywebsite
12 MalaysianInformation,CommunicationsandMultimedia Services886 Strategy(MYICMS 886)13 Refer:
httn://www.msc.com.mv/xtras/misc/mscI O/docs!2006%2004%20I7%2OTranslation%2OMDEC%2OSneech%2OEdit.doc
This high level commitmentby Malaysiahighlightspotentialopportunitiesfor furtherexchangeon digital contentissues,particularlygiventhecomplementarypolicycommitmentto thecreativedigital contentsectorby theAustralianGovernment.
TheMultimediaDevelopmentCorporationhasoutlinedthe‘way forwardin theNextLeapis theMSC MalaysiaCreativeMultimedia ContentInitiative, whichaimsat:
• ‘Utilising MSC designatedareasashubsfor thecreativemultimediaindustry
throughtheestablishmentofDigital MediaZones
• Strategicallianceswith contentdistributorslocally andglobally
• Focusingon funding IP in creativecontentcreation
• Providingcomprehensiveskills developmentprogrammesfor thecreativecontentindustry
• Providingaccessiblecontentcreationinfrastructurefor local developersandentrepreneurs.’14
TheAustralianCoalitionGovernment2004IT ElectionPolicynotesthat theGovernmentis committedto developinga comprehensiveDigital ContentStrategysupportedby theDigital ContentIndustryActionAgendain orderto acceleratetheproductionofdigital content,
TheDigital Content IndustryAction AgendaReportwasreleasedby theMinisterforCommunications,InformationTechnologyandtheArts andtheMinister for Industry,TourismandResourceson 13 March2006. A copyofthemediareleaseandlink totheReportis availableat:<http://www.minister.dcita.gov.au/media/mediareleases/unlockingthe potential an action agendafor australiasdigital content industry>
.
Backgrounddetailson theAction Agendaareat AttachmentA. Opportunitiesforfurtherexchangeon digital contentandrelatedissuesmaybeprogressedaspartoftheDigital ContentIndustryAction AgendaReportpriorities.
Research
With asignificantcommitmentby Malaysiato thedevelopmentofthecreativedigitalcontentindustry,opportunitiesmayalsobescopedto takeaccountofsharedresearchpriorities,particularly in areaswheretherearecomplementaryinterests.
For example,in March 2006AIMIA facilitatedinputto theWorldwideMobile DataSurveyconsortiumresearchinghow peoplein differentpartsoftheworld usemobilephoneservicesin theireverydaylife. In Australia,thesurveywascoordinatedbym.NetCorporationandtheUniversityofMelbourne,theprojectwasundertakenwithsharedpriorities to explorecustomerbehaviours,trendsandthemarketenvironmentfor themobile dataservicesbusiness.Othercountriesinvolved includedMalaysia,
‘~ Refer: htto://www.nisc.com.mv/xtras/misc/msc1 O/docs/media%2Oinfo%20
-
%2Ocreative%2Omultimedia%2Oindustrv.doc
HongKong, Taiwan,China,Greece,Denmark,Finland,United States,JapanandKorea.
TELECOMMUNICATIONS TRADE NEGOTIATIONS
Australia’saim in telecommunicationsservicesnegotiationsis to improveopportunitiesfor Australiantelecommunicationscompaniesthrough:
• gainingmarketaccessfor Australiancontrolledcompaniesin foreignmarkets;and
• ensuringtat theregulatoryenvironmentis fair, transparentandconducivetocompetition.
Thereare significantmarketaccessbafflersimposedon foreignentrantsinto theMalaysiantelecommunicationsmarket,including theprohibitionofwholly foreignownedcompaniesin themarket.
In line with Australia’sgeneralFTA aimsDCITA contributesspecialistadvicetosupportnegotiationsseekingmarketaccessandregulatorycommitmentsthat gobeyondthepartnercountry’sWTO commitments.Theextentto whichAustraliaseekscommitmentsbeyondthosemadein theWTO variesdependingon thestateofdevelopmentofcompetitionin theFTA partnercountry.
WORLD TRADE ORGANISATION (WTO)
DCITA’s interestsin theWTO coverthefollowing sub-sectorsof theservicesnegotiations:
• telecommunications;• computerandrelatedservices;• postalandcourierservices;and• audio-visualservices.
DCITA activelyparticipatesin delegationsto WTO negotiationsin thesesectors.Malaysiamadelimited commitmentsin telecommunications,computerandrelatedservicesand audio-visualservicesin theUruguayroundoftheWTO. Thesecommitmentspermitforeign investmenton specificserviceswithin thesesectorsthroughjoint ventureswith a foreignequitylimit of 30%. Malaysiahasalsomadelimited commitmentson theWTO TelecommunicationsReferencePaper. TheReferencePapersetsout a selectionofpro-competitiveregulatoryprinciplesthat areregardedastheminimumneededto encouragea competitivetelecommunicationssector.
Malaysia’spositionon extendingits existingcommitmentsin thesesectorsin thecurrentDoharoundofnegotiationsis not yetpublic. However,it is hopedthatMalaysiawill beableto furtherliberalisetheseimportantsectors.
BILATERAL TRADE
Telecommunications
In additionto marketaccessgainsfor AustraliantelecommunicationscompaniesthroughFTA negotiations,DCITA assistswith technicaladviceon thedevelopmentoftelecommunicationsspecificprovisionswhich outline thecompetitionandregulatorypoliciesthat companiesaresubjectto uponenteringamarket. Suchprovisionsaredesignedto provideregulatorycertaintyandensurean equitableandtransparentenvironmentfor telecommunicationscompanies.
MalaysianTelecommunicationsRegulatoryFramework
Malaysia’slegislativeframeworkfor regulationofthetelecommunicationssectorisbasedon Australia’sregime. While therearesomedifferencestheregimesareverysimilar.
TheMalaysianCommunicationsandMultimediaCommission(MCMC) is theregulatorfor thecommunicationsandmultimediaindustries. Its powersrelatingtotelecommunications,broadcastingandtheon-lineenvironmentareoutlinedin theMalaysianCommunicationsandMultimedia CommissionAct 1998andtheCommunicationsandMultimediaAct 1998 (CMA). In 2001MCMC’s powerswereincreasedto coverpostalservicesandit becametheCertifyingAgencyundertheDigital SignaturesAct. Its key rolesin thetelecommunicationssectorare:
• economicregulation,includingregulationofcompetitionin thetelecommunicationssectorandtelecommunicationslicensing;
• technicalregulation,includingallocationoffrequencyspectrum,telephonenumbersandelectronicaddresses;
• consumerprotection;and• socialregulationincludingcontentdevelopmentandregulation.
TheMinister for Energy,WaterandCommunicationsgrantstelecommunicationslicenceson therecommendationof MCMC. Therearefour typesoflicences:
• NetworkFacilitiesProvider(NFP) licencescoverall facilities operatedby atelecommunicationscompanyincluding: earthstations,fixed links andcables,public payphonefacilities, radio-communicationstransmittersandlinks,satellitehubsandcontrolstations,spacestation,submarinecablelandingcentres,switchingcentres,towers,poles,ductsandpitsusedin conjunctionwith otherfacilities;
• NetworkServiceProvider(NSP) licencescoverbandwidth,broadcastingdistributions,cellularmobile,accessapplicationsand spaceservices;
• ApplicationServiceProvider(ASP) licencescoverpublic switchedtelephonenetwork(PSTN)services,public cellularservices,voiceoverinternetprotocol(VoIP), public payphoneservicesandpublic switcheddataservices;and
• ContentApplicationsServiceProvider(CASP) licencescoverbroadcastingservices.
TheinclusionofbroadcastingunderthetelecommunicationslicensingschemereflectsMalaysia’sview thatit operatesin atechnologicallyconvergentenvironment.
Eachlicencetype,exceptCASP,hastwo categories:individual andclasslicences.Individual licencesaregrantedfor activitieswhichareconsideredto havea majorimpacton thepublic requiringahigh level ofregulationand/orinvolve high levelsofinvestment.Applicantsaresubjectto arigorousassessmentprocess.Class licencesareissuedfor nicheactivitiesandaresubjectto registrationanda light regulatoryregime.
As in Australia,holdersof telecommunicationslicencesarerequiredto contributeaproportionof their incometowardstheprovisionofuniversalservices.This is usedtoprovidetelecommunicationsservicesto underservedareas. CurrentlytheUniversalServiceProvisions(USP) coveronly thePSTN(standardtelephone)services. InMalaysia,an areais consideredunderservedif thepenetrationrateis morethan20%below thenationalaverage.
In additionto atelecommunicationslicence,providerswho wishto provideservicesusingtheirown facilities mustobtainanApparatusAssignmentLicencewhichallowsthetransmissionofradio-frequencysignalson aspecifiedfrequencyband. ApparatusAssignmentLicencesare availablefor differentpurposes,includingoperatingmobilephonetransmitters.Othertypesofspectrumlicencesarealsoavailable. Providerswho do not havea spectrumlicencemayoperateasmobile virtual networkoperators(MVNO); that is, theyprovidea serviceusinganothercompanies’infrastructureandspectrumallocation. This hastheeffect ofincreasingthenumberofoperators,andhencecompetition,by allowing telecommunicationscompaniesto operatewithout thecostofbuilding an infrastructurenetwork.
MCMC regulatestheconductof telecommunicationssupplierswhichcould‘substantiallylessencompetition’. Malaysiadoesnot haveageneralcompetitionlawatpresent. However,telecommunicationsspecificcompetitionlaw is setout in theCMA and is implementedby MCMC. A key areanot coveredby thecurrentlegislationis mergersandacquisitionsofcompanies.
Malaysia’saccessregimeensuresthat telecommunicationsnetworkand serviceproviderscangainaccessto critical telecommunicationsinfrastructureownedbyotherproviders. MCMC determinesfacilities andserviceswhichareto be placedonan AccessList. Theseservicesandfacilities arethencoveredby theaccessobligationsundertheCMA which entitlesthemto be availableto all users. This issimilarto theAustraliansystemunderwhichtheAustralianCompetitionandConsumerand Commission(ACCC) can ‘declare’ a servicewhichmustthenbemadeavailableto all providers. In Malaysiaall companieswhichhold atelecommunicationslicencearerequiredto registeran AccessReferenceDocumentwhich lists theirwholesalepricesfor all itemson theAccessList with theMCMC.
MarketAccessLimitations for AustralianTelecommunicationsCompanies
Similar to Australia’spolicy with regardto Telstra,theMalaysianGovernmentimposesforeign equitylimits on TelekomMalaysia. Foreignequity in TM is limitedto 30%oftheshareholdingswith amaximumof 5% equityheldin anyonecountryoutsideMalaysia.
In practice,foreign investmentin othertelecommunicationscompaniesis lessrestrictedthanmight beevidentfrom Malaysia’sWTO commitments.TheCommunicationsandMultimedia (Licensing)Regulations2000preventaforeigncompany(asdefinedin theCompaniesAct 1965) from applyingfor atelecommunicationslicence. As statedabove,Malaysia’sWTO commitmentsrestrictforeignownershipoftelecommunicationscompaniesto 30%. In practice,higherequitylimits arepermittedfor certaintypesoflicences. This is in line with therecommendationsin theMalaysianGovernment’s1999WhitePaper:StatusoftheMalaysianEconomywhichproposedthat foreignequitylimits fortelecommunicationscompaniesbe raisedto 61%with arequirementthat foreignholdingsbe reducedto 49%over five years.
Malaysiaimposesstringentguidelineson foreign investmentwith theForeignInvestmentCommitteerequiredto approveanyacquisitionoverRM 10 million(aroundAUD$3.6million) wheretheforeigncompanyholdsover 15%ofthevotingshare,or thetotal foreign investmentis greaterthan30%.
Thereis alsoastandardrequirementthat all companieslisted on theBursaMalaysia(formerlytheKualaLumpurStockExchange)beatleast30%Bumiputera’5owned.Furtherrestrictionson marketaccessfor foreign telecommunicationscompaniesareimposedthroughthelicensingregime.
NetworkFacilities Provider(NFP)Individual Licencescarrya foreignequitylimit of30%. Applicantsfor aNetworkServicesProvider(NSP) Individual Licencecanapplyfor a61%foreignequity cap;althoughtheforeignequitymustbereducedto49%within 5 yearsof incorporation.NorwegiantelecommunicationscompanyTelenorASA currentlyholdsa 61%stakein DiGi andis dueto divestby December2006. Telenorwill be thefirst companyrequiredto divestunderthis scheme.
Thedisparitybetweentheforeigninvestmentlimitations for NFP andNSP licencesmayimpedetheentryof Australiansuppliersinto theMalaysianmarketas,typically,acompanywill enteramarketby resellinganothercompany’sservices(usingaNSPlicence)., Howeverto expandthebusinessit maylaterwish to investin its ownfacilities, suchastransmittersorcables,whichrequireanNFPlicenceandhencedivestment.
TheseextensiveforeignownershiprestrictionsmeanthatAustraliantelecommunicationscompaniesarelesslikely to investin Malaysiabecausetheywould beunableto hold acontrolling interestin thelong-term. Reductionofmarketaccessrestrictionsis thereforean importantissue.
~ Bumiputera—Malaysandpeoplebelongingtoseveralotherindigenousethnicgroups areaffordedspecific rightsin theMalaysianconstitution,
ICT Trade with Malaysia
ThecommercialtradingrelationshipbetweenMalaysiaandAustraliais strong.Malaysiais a significantexporterof manufacturedproducts,especiallyelectricalandelectroniccomponents.In 2002, Malaysiawastheworld’s fifth largestexporterofsemi-conductors.MalaysianICT exportsto Australia—suchascomputers,laptops,telecommunicationsequipmentandelectroniccomponents—werevaluedat around$1.5 billion in 200516.
Australia’sICT goodsexportsto Malaysiawerevaluedat $45 million in 2003-04,andweredominatedby partsfor computers,telecommunicationsandelectroniccomponents.
Bilateral ICT Investment and Trade Opportunities
Malaysia’seconomicdevelopmentpresentsgoodprospectsfor robusttradeandinvestmentgrowthwith Australiain themediumto longterm. Malaysiamanufacturesawide rangeofcomputercomponentsandaccessoriesthroughdirectforeign investmentororiginal equipmentmanufacturerpartnershipswith localinvestors, Manyarebasedin thePenangFreeTradeZone,popularlyreferredto asthe ‘Silicon ValleyofSouthEastAsia’.
TheMalaysianIT industryis still largelyimport-orientedandrelianton foreign-basedtechnologies.This createsopportunitiesfor Australiancompanies.
Austradehasidentifiedthekey growthareasfor Australiansupplyofhardware,softwareand servicesin theMalaysianIT industry to include:
• e-commerceand secureonlinepa~mients;• banldngande-security;• systemsintegrationandconsultancyservices;• electronicservicesdelivery;• out-sourcingservices,ie. applicationserviceproviders;• customerrelationshipmanagementandcomputertelephonyintegration;• smartcardtechnologiesandticketing; and• IT educationandtraining.
As partoftheMSC FlagshipApplications,thereareseveralprojectswhich provideopportunitiesfor Australiancompaniesin theshortandlong-term,suchastheGovernmentMulti-PurposeCard(a singlemulti-purposecardincludingnationalidentitycards,driving licencesandan electronicpurse),theSmartSchoolsProject,ElectronicGovernmentandTelemedicine.TheMalaysiangovernmentis stilldevelopinga nationale-commerccframeworkto coversecurity,taxation,andonlinepaymentissues.
6 MalaysiaCountryFactSheet— DFAT, 2006
Ministerial Meetings
On7 April 2005, SenatortheHon HelenCoonan,Ministerfor Communications,InformationTechnologyandtheArts andtheMalaysianMinister ofScience,TechnologyandInnovation,Dato’ Sri Dr JamaludinB Dato’ MohdJarjis, signeda“StatementofIntent” to concludeaMemorandumofUnderstanding(MOU) oncooperationin ICT with Malaysia. TheobjectoftheMOU is to complementthefreetradeagreementnegotiationsbetweenMalaysiaandAustraliaby advancingthegrowthof investment,joint ventures,joint initiatives in researchandtechnologydevelopmentin theICT sector.
Thetwo Ministers met againin May 2006atthe World Congresson InformationTechnology2006, in Texas,USA.
ElectronicCommerce
DCITA coordinatesspecialistadvicein supportof tradenegotiationson electroniccommerce(e-commerce)with inputfrom otheragenciesincludingtheAustralianGovernmentInformationManagementOffice (AGIMO), theAttorney-General’sDepartment,theTreasuryandtheAustralianCustomsService.
In thetradeagreementcontext,e-commercecommitmentssetout an over-archingframeworkofprincipleswhich facilitatetradethroughtheuseandpromotionofe-commerce.Theseprinciplescoverareassuchasrecognitionof e-commerceusers(authentication)and electronicsignatures,consumerprotection,dataprotection(privacy)and paperlesstrading(theuseofelectronicversionsof governmentissuedimport/exportpaperwork).
Morebroadly,Australiaencouragestheharmonisationofrelevantlegislationbetweencountriesthroughtheuseof internationalstandardssuchastheUnitedNationsCommitteeon InternationalTradeLaw (UNCITRAL) ModelLaw on ElectronicCommerce1996asthebasisfor domesticlegislation.
DCITA, supportedby theMalaysianGovernment,recentlycommissioneda studytoexamineMalaysia’se-commercelegal infrastructureandcompareit to Australia’sinorderto assistwith this process.This workbuilt on previousASEANwork in whichthepotentialfor harmonisationof e-commercelegislationacrosstheASEAN regionwasexamined.
Malaysia’sElectronicCommerceBill is currentlypassingthroughParliamentandislikely to comeinto effect in 2007. This law will apply to all commercialactivitiesandaimsto reaffirmthevalidity andlegaleffect ofelectronictransactions,includingcontracts,andremovelegal obstaclesto e-commerce.It is expectedthat this Bill willbesimilar in effectto Australia’sElectronicTransactionsAct. An ElectronicGovernmentActivities Bill is alsounderdevelopmentwhich will containsimilarprinciplesfor government,ratherthancommercial,transactions.Theselawswill jointheDigital SignaturesAct 1997,whichestablisheselectronicsignaturesaslegallyvalid andequivalentto traditionalsignatures,andtheComputerCrimesAct 1997asMalaysia’se-commerce-specificlegislation.
Unlike Australia,Malaysiacurrentlylacks dataprotection(privacy)legislationanditscurrentconsumerprotectionlegislationdoesnot extendto electronictransactions.Weunderstandthat work is underwayin Malaysiato reviewandpossiblycreatelegislationin bothoftheseareas.
As amemberofASEAN, Malaysiahasbeenactivein promotingtheuseofe-commercethroughthee-ASEAN initiativewhichseeksto promotetheuseof ICTthroughoutASEAN.
Digital Content
In relationto tradeandexportpriorities, theDigital ContentIndustryActionAgendaReportsetsout thenextstepswhich aim to takeaccountof establishedtradedevelopmentinitiatives. Tradeopportunitieswith Malaysiamayfactorin thisprocess.
Forexample,oneofthekey industryassociationsthat will beprogressingtheDigitalContentIndustryAction AgendaImplementationPlan,theAustralianInteractiveMediaIndustryAssociation(AIMIA) hasledtrademissionsto Malaysiaoverthepastyearin associationwith Austrade,including:
• CommunicAsia(Singapore)& visit to Malaysia,June2005;and
• AustralianeLearningShowcase,KualaLumpur,21 —30 November2005
OTHER COOPERATION
International TelecommunicationUnion (ITU)TheITU is an internationalorganizationwithin theUnitedNationsSystemin whichgovernmentsandtheprivatesectorcoordinateglobaltelecomnetworksandservices.
Both AustraliaandMalaysiaaremembersoftheITU Council, whichmanagestheoperationoftheITU betweenthefour-yearlyPlenipotentiaryConferences.
Asia-Pacific Teleconununity (APT)TheAPT is a regionalorganisationofgovernments,telecommunicationsserviceproviders,manufacturesofcommunicationequipment,researchanddevelopmentorganisations.It servesasafocal organisationfor communicationandinformationtechnologyin theAsia Pacific.
Both MalaysiaandAustraliaareveryactive membersof theAPT andarecurrentlyworkingverycloselyto increasetheAPT’s efficiencyandeffectiveness.
APEC TELMalaysiais activein theAPECTelecommunicationsand InformationWorking GroupandprovidesthechairoftheSecurityandProsperitySteeringGroupwhich dealswithawide rangecyber-security,infrastructureande-commerceissues.
RegulatorySkills TrainingFundedjointly by theAPEC TEL, five workshopshavebeenheld in Indonesia,Thailand,Vietnam,thePhilippinesandMalaysia.
Thefourth RegulatorySkills TrainingWorkshopwasheldatthepremisesof theMalaysianCommunicationsandMultimedia Commission(MCMC), KualaLumpur,in February2006. Theaim oftheworkshopwasto providetrainingto assiststaffinnewly formedregulatorsto developcompetentskills in key areasforeffectiveregulationoftelecommunications.Thepresentersincludedtwo formerACA officials.Thirty sevendelegatesfrom threecountriesattendedtheworkshop.Keyissuesforparticipantsincludedinterconnection,balanceddecisionmaking,anti-competitiveconduct,enforcementclarity, contentissues,standardsandsecurity.
ATTACHMENT A
Digital Content Industry Action Agenda
TheDigital ContentIndustryAction AgendaReportwasreleasedby theMinisterforCommunications,InformationTechnologyandtheArts andtheMinister for Industry,TourismandResourceson 13 March 2006. A copyofthemediareleaseandlink totheReportis availableat:<http://www.minister.dcita.gov.au/media/mediareleases/unlockingthe potential an action agendafor australiasdigital content industry>
.
TheAction Agendais aframeworkfor building acohesivevoicefor industrytoadvancecommercialindustrydevelopmentandbuild abroadindustryrelationshipwith Government.Keyrecommendationsfor industryactioncontainedin theReportwhichform thebasisofa 12-24monthindustry-ledstrategicplanareto:
• establishan industry-basedInvestmentScopingForum;• developacohesivetradestrategyandinvestigatean industry-basedmarket
intelligencenetwork;• extendindustry-basedtrainingmodels;• work on priority-settingandcommercialisationissueswith publicly funded
researchinstitutions;and• progresslonger-termissuesrelatingto intellectualproperty,statisticsand
standards,in consultationwith relevantstakeholders.
TheGovemmenthassupportedtheDigital ContentIndustryAction AgendaReport’skeyrecommendationsfor industryaction.
TheReportidentifiesthefollowing priorities to boostAustralia’sindustry
competitiveness:
• improving the level ofprivatesectorinvestmentandseedfunding;
• building astrongerinternationaltradeprofile;
• extendingindustry-basedtraining initiativesaspartof an overallskills
accreditationframeworkaimedat filling industryskills gaps;and
• establishingbetterlinkagesbetweenindustryandresearchand development
institutions.TheGovernmentwill bedevelopingacomprehensiveDigital ContentStrategynowthattheAction Agendareporthasbeenreleased.TheStrategywill be significantlyinformedby theDigital ContentIndustryAction AgendaReportandthenextstepswhich involve anindustryimplementationplanwhichhasbeenprofiledat industryawarenessforumsheldnationallyduringJuneandJuly2006.
