Alternative Dispute Resolution in Malaysia Comprehensive Guide

Background of Alternate Dispute Resolution in Malaysia

Specialized tribunals to deal with specific disputes had been established in Malaysia long
before the problems with the court system surfaced. These tribunals are established as courts
or centres of arbitration. Examples are:
(a) The Kuala Lumpur Regional Centre for Arbitration, was established in 1978.
The KLRCA was set up in 1978 through an inter-governmental international law body, the
Asian-African Legal Consultative Organisation, and provides a neutral system to settle
disputes in trade, commerce, and investment with and within the Asia-pacific region.
The KLRCA, however, is an independent institution and is not governed by the Arbitration
Acts of 1952 and 2005. The rules that it applies are the United Nations Commission on
International Trade Law (UNCITRAL) Arbitration Rules of 1976 with certain modifications
and adaptations.
(b) The Industrial Court (first established actually in 1948).
(c) The Public Services Tribunals.
(d) The Special Commissioners of Income Tax, established under the Income Tax Act, 1967.
Subsequently, as the idea of ADR began to gain ground and it became clear that an alternative
to the conventional court system was not only needed but a valuable and practical means for
the resolution of a growing number of disputes, particularly in commercial cases, other
mediation centers were established to cater for mediation in specific disputes, such as the
Insurance Mediation Bureau (1992) and the Banking Mediation Bureau (1997). The latest to
join the ever-growing list of ADR centres are the Tribunal for Consumer Complaints (1999),
the Bar Council’s Malaysian Mediation Centre and the Copyright Tribunal (2000)
Historically, each village has been administered by a ‘Ketua Kampung’ (village head), whose
duties include the settling of disputes among villagers under his jurisdiction
ADR: AN ANALYSIS IN THE MALAYSIAN PUBLIC SERVICE
. It is crucial to examine briefly the history of Malaysia's public sector to determine the
appropriateness of ADR within the sector. The Malaysian public service inherited a good
basic physical infrastructure and procedural system from the British public service. During
the pre-independence period, the British introduced structures, practices and ethos which
subsequently set the foundation and the tone of the current Malaysian Public Service. Article
132 of the Malaysian Federal Constitution stipulates that the Public Service consists of the
General Public Service of the Federation, the State Public Services, the Joint Public Services,
the Education Service, the Judiciary and the Legal Service of the Armed Forces. To date, the
service has staff strength of 1.4 million employees covering 279 schemes of service. The
pillar of the Malaysian public service was long established by officers from what is currently
known as the Administration and Diplomatic Service (ADS). Formerly the civil service
attracted the best and brightest scholars from England to be appointed as administrative
officers. However later when the British began to centralise its administrative power, they
expanded the recruitment to appoint better qualified local people into the service. Despite a
small number of local officers in the service at that time, they had done an excellent job while
the British were forced to leave the country during the Japanese occupation. When the British
subsequently returned, they eventually acknowledged the major roles played by the local
administrative officers. This was a turning point in the evolution of ADS, which is the core
body in planning and implementing public policies. This group, generally described as
"elite", provides almost all the senior administrative officials at the international, federal,
state and district levels. , this vision becomes the main aspirations of all Malaysians. The
vision is actually quite specific about the roles of the civil service, which will continue to be
critical, especially in providing a stronger foundation for the attainment of the country's
socio-economic objectives. Thus, Malaysia is quite institutionally advanced and extremely
concerned to manage its human resources in order to secure their performance particularly in
terms of training and development; performance appraisal; promotion and succession
planning; salary, compensation and benefits. Despite these numerous initiatives taken to
promote and improve the performance of the public sector, the area of conflict management
seems to have been left unexplored. As Forster and Whipp (1995, as cited in Lipiec, 2001)
have long proposed, changing market paradigms affect human resource management,
including the management of work or family conflict. Roper (2005) stresses that management
of conflict is one of the chief roles played by managers in organisations. Oudeh (1999 as cited
in Suppiah Et Che Rose, 2006 ) emphasises that managing workplace conflict is a crucial
investment for long term viability and success for business. In essence, effectively managing
conflict adds substantial value to an organisation, and even can act as a catalyst for change
(Suppiah Et Che Rose, 2006). Nonetheless. the applicability of ADR in the Malaysian context
may need more analysis. Kozan (1997, as cited in Folger, Poole Et Stutman, 2005) suggests
that people with different cultural backgrounds react differently to conflict. He suggests that
they will have different attitudes towards conflict, different expectations about appropriate
conflict behaviour, and different approaches to managing conflict. The following analysis
applies the SWOT framework to examine the strengths and weaknesses of ADR, and the
opportunities and threats in the sector towards acceptance of ADR
Arbitration in Malaysia
The paradox of arbitration lies in its confidentiality and freedom of choice; yet it would be
hard to find another area of law that calls, nay, demands, for uniformity, consistency,
predictability and control than arbitration. This is where the United Nations Commission on
International Trade Laws (UNCITRAL) Model Law on International Commercial Arbitration
plays its quintessential role. In its march towards providing that workable platform for
commerce and business, legal practitioners and judicial systems, many jurisdictions have
found it the preferred if not the right choice. Malaysia was no exception.
When, after over fifty years of applying and enforcing the Arbitration Act of 1952, left over
from the pre-Independence days, where the reception of that Act, on the ground, was
frequently short and wanting, it was felt that Malaysia needed to do more. Amendment of the
1952 Act was not enough; an entirely new piece of legislation seemed the only credible
response.
And, so the Arbitration Act 2005 [Act 646] was enacted. The Act provides for both domestic
and international arbitration, as defined in the Act, and it adopts substantially the UNCITRAL
Model Law in respect of both types of arbitrations. Consonant with the inscribed principle of
party autonomy, the extent of the application of the Act, in either case, is subject to parties’
choice. Since the Arbitration Act came into force on 15 March 2006, it would not be wrong to
say that the Act has certainly changed the law and the landscape of arbitration in Malaysia.
The courts of Malaysia have interpreted the Act in the last decade and more, with a rigour
that has seen the Act taken back to Parliament for no less than three separate sets of
amendments. The most recent exercise was in 2018, driven principally by the Federal Court’s
decision in Far East Holdings Bhd & Anor v. Majlis Ugama Islam dan Adat Resam
Melayu Pahang and other appeals [2018] 1 MLJ 1 on the scope and application of section 42
of the Arbitration Act 2005. Section 42 was the mechanism under which an arbitrating party
may refer questions of law arising out of an award in a domestic arbitration to the courts.
Latest Amendment
On 8 May 2018, amendments made to the 2005 Act by the Arbitration (Amendment) (No 2)
Act 2015 came into force, bringing Malaysia's arbitration regime further into line with the
Model Law. The following are some of the key changes and innovations (references are to the
2005 Act as amended):
(1) the status of an emergency arbitrator under sec 19H: The definition of ‘arbitral tribunal’
under sec 2 now includes an emergency arbitrator. This ensures that interim measures granted
by an emergency arbitrator are binding;
(2) recognition of the parties' freedom under s 3A to choose their representatives in arbitral
proceedings: The parties are assured of their freedom to choose representatives and are not
limited to advocates and solicitors admitted to practise in Malaysia;
(3) recognition of electronic means of communication under s 9: The 2005 Act now
recognises that arbitration agreements may be concluded by electronic means;
(4)interim measures under ss 11, 19 and 19A-19J: The High Court and the arbitral tribunal
are accorded the same powers to grant interim measures;
(5) the right to choose applicable rules of law under s 30: The parties have the right to choose
any law or rules of law applicable to the substance of a dispute. Further, the tribunal may
decide according to equity and conscience, if this was agreed upon by the parties;
(6) pre- and post-award interest under s 33: The arbitral tribunal is empowered to grant pre-
and post-award interest on any sums that are in dispute;
(7) ensuring the confidentiality of arbitration and arbitration-related court proceedings under
ss 41A and 41B: The 2005 Act now expressly provides for the confidentiality of arbitration
and related court proceedings; and
(8) repeal of the question of law provisions in ss 42 and 43: A party may no longer refer
questions of law arising from an award to the High Court. This is to reinforce the principle of
minimum court intervention and the finality of arbitral awards.
The overarching effect of these amendments is to enhance both the finality of awards in
Malaysian-seated arbitrations and the regional competitiveness of Malaysia's arbitration
regime
The AIAC Arbitration Rules 2018
The AIAC Arbitration Rules 2018 (the 2018 Rules) now also accord the arbitral tribunal the
power to grant pre-award interest. Additionally the setting of stringent criteria for challenges
to arbitrators under the 2018 Rules has decreased the number of frivolous challenges.
“The overarching effect of … [the 2018] amendments [to the 2005 Act] is to enhance both the
finality of awards in Malaysian-seated arbitrations and the regional competitiveness of
Malaysia's arbitration regime.”
In terms of significant trends in administered arbitration, there appears to be a steady increase
in parties adopting the AIAC Fast Track Arbitration Rules 2018. This is attributable to an
enhanced appreciation of the time and cost efficiencies inherent in such proceedings. Parties
also seem receptive to using the new consolidation mechanisms in the principal 2018 Rules,
which have seen approximately six matters consolidated in administered arbitrations.
The AIAC's Technical Review mechanism is also gaining acceptance in ad hoc arbitrations,
with a handful of awards being submitted to the AIAC for Technical Review with the consent
of the parties and the arbitral tribunal. The AIAC also received and acted expeditiously on its
first emergency arbitrator appointment in 2019, marking the beginning of emergency
arbitrator appointments in Malaysia.
“The AIAC is presently working on amending its Arbitration Rules to reflect best
practices in international arbitration. It is anticipated that a new edition of the Rules
will be published in late 2020.”
As previously mentioned, there is a debate on whether s 42 of the 2005 Act should be
restored in a modified form. There is also a debate on the introduction of third-party funding
into Malaysia's arbitration regime.
The AIAC is presently working on amending its Arbitration Rules to reflect best practices in
international arbitration. It is anticipated that a new edition of the Rules will be published in
late 2020.
some of the 2018 amendments to the Malaysia Arbitration Act 2005 (the “Act”). One
interesting topic of debate was the deletion of Section 42 of the Act (which provided that a
party may refer to the High Court any question of law arising out of an award). Diametric
views were expressed – that, on the one hand, the amendment is laudable for promoting
finality of arbitral awards and, on the other hand, it removed a safeguard that domestic
arbitrations would have benefitted from.
Also in 2022, the Malaysia High Court granted an interim injunction against a non-party to an
arbitration agreement and the arbitration, clarifying that the High Court has the power to do
so under Section 19J of the Act, which grants the High Court the power to order interim
measures.1)
Landmark cases
(1) Press Metal Sarawak Sdn Bhd v Etiqa Takaful Bhd (FC) (7) Stay of court
proceedings pending arbitration
In this case, the Federal Court interpreted s 10(1) of the 2005 Act, which provides for a
mandatory stay of court proceedings pending reference to arbitration. The question before the
court was whether a stay of proceedings should be granted where only one part of the matter
in dispute fell within the arbitration clause.
The Federal Court held that in determining whether to grant a s 10(1) application, the enquiry
must be restricted to the issue of whether there was in existence a binding arbitration
agreement or clause between the parties that was not null and void, inoperative or incapable
of being performed. It was not for the court to delve into the details of the dispute, as an
arbitral tribunal's jurisdiction is a matter to be decided by the tribunal itself, without any
interference by the court.
It was clearly stated in the case that the Malaysian courts –
“should lean more towards granting a stay pending arbitration under s 10(1) of the 2005 Act,
even in cases where there is some doubt about the validity of the arbitration clause or where it
is arguable as to whether the subject matter falls within or outside the ambit of the arbitration
clause.”
The courts were encouraged to apply a wide interpretation to the arbitration clause in
determining whether a dispute or difference between the parties fell within the clause, based
on the express terms of the agreement and the intention of the parties and taking into
consideration the commercial reality and the purpose for which the agreement was made.
(2) Thai-Lao Lignite Co Ltd & Anor v Government of The Lao People's Democratic
Republic. (8) Law of the arbitration agreement
In this case, one of the questions of law that the Federal Court had to determine was whether,
where the arbitration clause itself was silent on the matter, the parties' stipulation of Malaysia
as the seat of the arbitration constituted an express agreement that the law governing the
arbitration agreement was Malaysian law.
On the one hand, the law governing the contract was agreed to be New York law, save for
five specific areas of dispute to which Laotian law would apply. The procedural rules were
also stipulated to be New York law. On the other hand, the seat of the arbitration was Kuala
Lumpur.
The Federal Court held that, in the absence of an express agreement between the parties, the
determination of the law governing the arbitration agreement was dictated by the conflict of
laws rules. Reliance was placed on s 30(4) of the 2005 Act and art 33(1) of the UNCITRAL
Arbitration Rules (1976) (UNCITRAL Rules), (9) both of which provided that where parties
fail to designate the law applicable to the substance of the dispute, “the arbitral tribunal shall
apply the law determined by the conflict of laws rules”. While acknowledging that both the
UNCITRAL Rules and the 2005 Act were silent on the approach to be taken where parties
failed to stipulate the law governing the arbitration agreement, the Federal Court held that by
adopting those rules and/or the 2005 Act, the parties had implicitly accepted that the conflict
of laws rules should determine the applicable law.
Under the conflict of laws rules, the law that has the closest and most real connection to the
arbitration agreement would be applied as the law governing the arbitration agreement. In the
Thai-Lao case, it was held that the law that had the closest connection to the arbitration
agreement was Malaysian law, in reliance on the fact that the 2005 Act was the lex arbitri and
the curial law. The Federal Court found that New York law had no connection to the
arbitration agreement, despite the substantive law of the contract being New York law and the
arbitration agreement expressly requiring the arbitral tribunal to be qualified in New York
law.
(3) CTI Group Inc v International Bulk Carriers SpA. (10) Two-stage process for
recognition and enforcement of arbitral awards
In this case, the Federal Court answered the question of whether the court could set aside an
ex parte court order (obtained pursuant to s 38 of the 2005 Act) granting leave to recognise
and enforce an arbitral award on grounds other than those expressly set out in s 39 of that
Act. The subject-matter of the application was an ICC arbitral award. The defendant had
applied to set aside the ex parte order on the basis that the plaintiff had failed to comply with
the requirements set out in s 38 of the 2005 Act.
The Federal Court first clarified the statutory two-stage process to be adopted in the
recognition and enforcement of an arbitral award. In the first stage, which is ex parte,
recognition and enforcement is mandatory if the formal requirements under s 38 of the 2005
Act appear to have been met. In the second stage, which is inter partes, the court then deals
with any application to set aside the ex parte order on any of the exhaustive grounds set out in
s 39 of that Act.
The Federal Court opined that in the first stage, if the parties to the proceedings were named
in the contract containing the arbitration agreement, or if it was obvious on the face of the
arbitration agreement that they were parties to the agreement, then the prima facie test for a
valid arbitration agreement and a valid arbitral award is satisfied and leave to enforce the
award must be granted. However, where it is not obvious that those parties were parties to the
agreement, the court had the option either to (1) refuse leave to enforce the award, or (2)
order an inter partes hearing wherein the party seeking enforcement would have a second
opportunity to produce additional evidence at the first stage to satisfy the court as to the
existence of a valid arbitration agreement between the parties.
Once the court was satisfied that the first stage was completed, it would then move on to the
second stage of the process. In this substantive stage, the order granting leave to enforce an
award could only be set aside on the exhaustive grounds available under s 39 of the 2005 Act.
In the CTI Group case, the Federal Court held that the party opposing recognition and
enforcement of the award was limited to relying only on the grounds set out in s 39 of the
2005 Act when challenging recognition and enforcement and was not permitted to set aside
the said ex parte order under s 38 of that Act on the ground that there was no arbitration
agreement in existence between the parties.

Mediation laws in Malaysia

Claiming overdue payments could be an inconvenient process. For business owners, it may
affect business relationships and at the same time the non-payment will impact business’ cash
flow and cause various impacts on the company’s operations. Therefore, one needs to opt for
the best and most effective way of debt settlement. It is important to assess the situation, and
the nature of the debt, among other things, before considering which method of resolution
will be the best for the parties to achieve a common objective.
Mediation is a useful strategy to recover debts as it is a framework that is known to be one of
the effective alternative dispute resolutions (“ADR”). Mediation is commonly considered
when the parties wish to have an amicable settlement outside the court proceeding, and when
they are willing, in good faith, to commit the effort to resolve the disputes. Despite being a
less formal compared to other ADR such as arbitration, Mediation process is
comprehensively guided under the law in Malaysia, in respect of among others, the
confidentiality, the process, cost and others.
This article will provide an insight of the process of settlement of debt through mediation, the
governing laws, the estimated timeline and the costs involved thereof
Clause 3 of the Mediation Act 2012 provides the definition of “Mediation” which means a
voluntary process in which a mediator facilitates communication and negotiation between
parties to assist the parties in reaching an agreement regarding a dispute. With the assistance
of a neutral, trained and person expert in the subject matter of the dispute, parties will be able
to discuss their problems through a mediator. In cases of debt, parties may discuss the best
way to implement the settlement, based on each parties’ financial conditions.
In some events, Mediation could be implemented based on the Court’s recommendation.
Although parties had commenced the litigation process, the Court, when in its opinion that
Mediation could settle the matter, will recommend the parties to settle through Mediation.
This process is called a court facilitated Mediation.
General provision of mediation laws in Malaysia
The primary legislation that governs the Mediation process in Malaysia is the Mediation Act
2019. The key provisions that provide the process of Mediation includes the following:
 ・Section 5 where it provides that a person may only initiate the Mediation process by
sending to the person with whom he has a dispute, a written invitation regarding the
mediation which specify the matter in dispute. Thereafter, the Mediation process is
considered commenced once the recipient responded to the said invitation with their
agreement to use the said method to settle the matter.
・Section 6 where it provides that parties in Mediation shall enter into a mediation
agreement in writing, which terms and conditions include the agreement to submit the matter
to Mediation, the appointment of the mediator, the cost to be borne by the parties and other
terms which the parties deem appropriate.
・Section 7 where it provides the requirements to appoint a mediator which include the
having the relevant qualifications, special knowledge or experience in mediation, satisfy the
rules of the mediation centre.
・Section 11 where it provides the conduct of mediation where mediation must be privately
conducted either with the parties together or separately. Further, parties may choose any non-
party to participate to assist the party, subject to the consent of the mediator.
With the help of Mediation, parties can seek to discuss the best practical solution to settle
their debts. Using the highly trained mediator’s services, parties may consider to implement
the ideas or proposals suggested by the mediator which may include the repayment plans to
be agreed in the settlement agreement. This is because the mediator is trained to provide the
fair proposal for both parties.
Mediation is specifically recommended when you wish to preserve the business relationship.
With the less formal and friendlier setting, Mediation is perceived as a mere discussion to
resolve an issue, rather than to commence a “fight” such as in litigation. The other advantages
like as flexibility, ease to arrangement and can quick be concluded, also makes Mediation to
be more preferable

Conciliation laws in Malaysia

The use of conciliation is at its infancy in Malaysia as with most countries in the South East
Asia Region where the term conciliation simply implies a non-binding process where a
neutral person attempts to facilitate and find an acceptable solution to a dispute between the
parties. Although conciliation has been used in Malaysia for some time in the settlement of
disputes in relation to family law and employment the concept of its use for the settlement of
construction disputes is still considered foreign. The Industrial Relations Act 1967 and the
Law Reform (Marriage and Divorce Act 1976 both refer to conciliation as recognised means
to settle disputes.
Conciliation is being promoted by some quarters within Malaysia namely the Chartered
Institute of Arbitrators, the Malaysian Institute of Arbitrators and the KLRCA who have
published rules for conciliation.
At this point we should consider what conciliation really means. Conciliation is a form of
alternative dispute resolution (ADR) process whereby the parties to a dispute agree to utilise
the services of a conciliator, who then meets with each of the parties separately in an attempt
to resolve their differences. Conciliation differs from arbitration in that the conciliation
process, of itself, has no legal standing, and differs from mediation in that the parties seldom,
if ever actually face each other across the table in the presence of a conciliator.
A conciliator usually has no authority to require the presentation of evidence or call
witnesses; indeed, the conciliator usually writes no decision and makes no award. However,
if the conciliator is successful in negotiating an understanding between the parties, then that
understanding is almost always recorded in writing, often with the assistance of the respective
parties legal advisors, and signed by the parties, at which time it becomes a legally binding
agreement between the parties.
Conciliation can be carried out by a conciliator appointed by the parties, being someone that
both parties respect and consider able to bring about a resolution of the dispute. Alternatively
the parties may prefer to use a professional conciliator, being someone trained in the
conciliation process, and best able to assist the parties towards a resolution. Where the parties
cannot reach agreement on the conciliator but have agreed the process in accordance with
the KLRCA Conciliation rules 2011 the Director of the KLRCA will appoint one.
The Conciliator may choose to attempt to resolve the dispute between the parties using a
number of methods the choice of which will be of his choice but at all times he should act
impartially.
A common method is termed as shuttle diplomacy, whereby the parties to the dispute are
placed in separate rooms and the conciliator goes from one room to the other trying to find
common ground in order to bring about a resolution of the dispute.
A variation of that method is where the conciliator asks the parties to independently list their
objectives and the outcomes they desire from the conciliation. The conciliator then discusses
with the parties their respective lists, requiring them to priorities the items. Thereafter he
encourages them to give on the objectives one at a time from the least important upwards,
thus reducing the number of issues actually in dispute.
In Malaysia the KLRAC provide dispute resolution services in respect of conciliation. As
noted above they have published rules in respect of conciliation and these are based on the
UNCITRAL Conciliation Rules 1980 amended.
Where the KLRAC Rules are adopted the parties have to abide by these unless both parties
agree otherwise or such rules would be conflict with laws relevant to the dispute. A summary
of the rules and procedure to be followed is outlined.
1. The party desiring Conciliation shall submit a written application to the KLRAC Director.
2. The application shall include a brief outline presentation of the facts of the dispute together
with the amount involved, copy of conciliation agreement (if any), and the registration fee.
3. The Director shall notify the other party with the application of Conciliation. The other
party shall confirm within 30 days or KLRAC will treat the request for conciliation rejected.
4. The parties shall attempt to agree on a conciliator, in the event they fail to within 14 days
of the acceptance then the Director of KLRAC shall appoint and the parties shall be deemed
to accept such appointment.
5. At least 7 days prior to commencement of the conciliation sessions both parties shall
submit their summaries to the conciliator and the other party
6 The parties agree to co-operate with the conciliator in attempting to reach settlement
7. In the event settlement is reached during conciliation the parties shall record such in
writing and inform the Director of KLRAC in writing.
The KLRAC also publish standard forms for use in the process and publish a schedule of fees
that shall be payable to the centre dependent upon the value of the dispute.
At this time most standard forms of contract do not provide for conciliation as a step to be
taken in the dispute resolution process, were conciliation to be listed as a step to be
considered by the parties before bringing the dispute to arbitration then this would no doubt
lead to increased interest but it would be wrong in our opinion to include such as a
prerequisite to arbitration as conciliation is a form of amicable settlement and as mention
above is not legally binding unless any agreement reached is executed between the parties.
Conciliation should remain one of the several available forms of alternative dispute
resolution; and, if the parties involved in a dispute process consider conciliation to be the
most effective way of resolving that dispute, then it is a method that should be retained.

Various Malaysian ADR mechanism which are alternatives to court

 Tribunal For Consumer Claims (TCM) Established under Sect. 85, Part XII,
Consumer Protection Act 1999 Independent body – primary function of hearing and
determining claims lodged by consumers against supplier/manufacturer Alternative
channel apart from court for a consumer – in a less cumbersome, speedy manner and
at minimal cost No party shall be represented by an advocate/solicitor during hearing
Awards within 60 days from the first day of hearing Every award made shall be final
and binding on all parties
 Financial Mediation Bureau (FMB) Independent body under Central Bank,
Malaysia Objective – to help settle a dispute between the customer and financial
service providers – i.e. – Banking and Insurance institutions Provide free, fast,
convenient and efficient avenues to refer disputes for resolutions as an alternative to
courts Consists of Insurance Mediation Bureau (IMB) AND Banking Mediation
Bureau (BMB) Awards within 60 days from the first day of the hearing
 Malaysian Mediation Bureau (MMC) Established under the Malaysia Bar Council
Provides mediation services for the settlement of disputes to incorporate mediation
into the pre-trial process in court
Future of ADR in Malaysia
The future of Alternative Dispute Resolution (ADR) in Malaysia shows promising growth
and development. The Malaysian judiciary and government have demonstrated strong support
for ADR mechanisms, particularly mediation and arbitration, as effective means to resolve
disputes outside traditional court litigation. The recent amendments to the Mediation Act and
continuous efforts to strengthen the Asian International Arbitration Centre (AIAC) reflect
Malaysia's commitment to positioning itself as a regional ADR hub. Digital transformation is
also playing a crucial role, with the introduction of online dispute resolution platforms and
virtual ADR proceedings becoming more prevalent, especially following the COVID-19
pandemic's impact on traditional dispute resolution methods. The legal education system in
Malaysia is increasingly incorporating ADR modules into their curricula, preparing future
legal practitioners for a landscape where ADR skills are essential. Industries such as
construction, banking, and commerce are showing greater acceptance of ADR clauses in
contracts, suggesting a broader adoption across various sectors. Additionally, Malaysia's
strategic location, multicultural environment, and growing expertise in Islamic finance
dispute resolution through ADR mechanisms position it uniquely in the global ADR
landscape. However, challenges remain in terms of public awareness, standardization of
practices, and the need for more experienced ADR practitioners, which the country continues
to address through various initiatives and capacity-building programs.