Malaysia is approaching the second half of 2021 under a nationwide lockdown. At the end of May 2021, the Prime Minister's Office announced that the country would be placed under a full movement control order for a fortnight at the start of June 2021. Only essential services and economic sectors are able to operate, restricting activity in the construction sector.
A high court recently held that a scheme of arrangement under Section 366 of the Companies Act 2016 is an insolvency-related event for the purposes of the Convention on International Interests in Mobile Equipment and the protocol thereto. This is an interesting case which will likely be instructive in many jurisdictions as the number of airline restructurings continues to rise due to COVID-19's impact on the aviation industry.
In 2020 the Construction Industry Development Board (CIDB) introduced initiatives to ease the burden on construction industry players affected by the Movement Control Order. The CIDB has now announced that it is extending several of these initiatives to ease the burden on contractors that intend to register or renew their registrations with the CIDB. It seems that the CIDB's initiatives have assisted industry players; thus, their extension will likely be welcome news.
The High Court recently issued a landmark decision that extensively examined the court's jurisdiction and duties when considering an application under Section 366(1) of the Companies Act 2016 for an order to convene creditors' meetings to consider and approve an arrangement scheme. The court ruled that the proposed arrangement scheme was an 'insolvency-related event' for the purposes of the Cape Town Convention's aircraft protocol.
The construction sector is one of the economic sectors that is permitted to operate during the second Movement Control Order. The Construction Industry Development Board of Malaysia's website recently published the standard operating procedure that companies with permission to operate during MCO 2.0 must comply with when carrying out construction works. This article discusses this standard operating procedure's key points.
The Kuala Lumpur High Court recently ordered the immediate release of a Pakistan International Airlines Boeing 777 aircraft. The aircraft had been grounded and detained at Kuala Lumpur International Airport for two weeks as a result of a mandatory injunction. This is believed to be the first Malaysian case to involve a mandatory injunction to ground an aircraft.
Following the prime minister's announcement regarding the imposition of the Movement Control Order (MCO 2.0) in Johor, Malacca, Kuala Lumpur, Putrajaya and Labuan, Selangor, Penang and Sabah, the Ministry of International Trade and Industry issued the list of economic sectors that can operate during MCO 2.0, which includes the construction sector. The Ministry of Works subsequently issued a press statement clarifying that critical construction works can be carried out during MCO 2.0.
The surge in the number of disputes involving the statutory adjudication mechanism in the Construction Industry Payment and Adjudication Act (CIPAA) 2012 has led to a significant number of consequential challenges to adjudication decisions in the courts. This article highlights the notable decisions handed down by the Malaysian courts in 2019 and their effect on the future application of the CIPAA.
With airline companies rapidly depleting cash reserves and any form of subsidies to ensure survival in the current climate, the unsurprising reality is that efforts to go green have taken a step back. However, the pandemic has in a way allowed relevant industry players to pause and ponder on long-term strategies, including but not limited to the sustainability of both airline companies and, importantly, environmental protection.
A contractor and claimant, Econpile, has had verdicts delivered by both the Court of Appeal and the High Court on, among other things, the issue of whether an adjudicator has the jurisdiction to decide on a payment claim when the contract has been terminated and whether the contractor is entitled to commence an adjudication proceeding under the Construction Industry Payment and Adjudication Act 2012 after the contract has been terminated.
The domino effect of airlines' massive lay-offs of pilots is a decrease in pilot training applications in Malaysia. One of the many flight training organisations in Malaysia has seen a 30% fall in enrolment at its eastern Malaysia centre and a 15% decrease in its western Malaysia centre. The reason for this is because the investment does not necessarily guarantee its returns.
In the midst of the COVID-19 pandemic and in a move to boost economic activity through medical tourism in Malaysia, the government has announced that it will partially reopen Malaysia's borders to medical tourists from designated green zone countries (eg, Brunei, Singapore, South Korea, Japan, Australia and New Zealand), allowing them to fly in via commercial or chartered flights.
The Kuala Lumpur High Court recently dismissed an application by AirAsia Berhad and its long-haul sister airline, AirAsia X Berhad, for leave to commence judicial review proceedings against a financial penalty imposed by the Malaysian Aviation Commission (MAVCOM). This was the first time that an airline had sought to challenge a penalty imposed by MAVCOM.
On 7 June 2020 the government announced that Malaysia's Movement Control Order would enter a 'recovery phase' beginning on 10 June 2020 and ending on 31 August 2020. As a result, the Malaysian Aviation Commission and the Civil Aviation Authority of Malaysia recently introduced measures to ease the administrative and regulatory challenges faced by the aviation industry during the Recovery Movement Control Order period.
Drone technology is developing fast and drone popularity is growing even faster. It is crucial that drone regulations keep up to speed by undergoing periodic updates and amendments. The time is right for a comprehensive update to the rather limited drone rules in the Civil Aviation Regulations. It is also hoped that both the Civil Aviation Authority of Malaysia and the Ministry of Transport will keep a close eye on the development of other aeronautical projects such as the flying car.
In July 2019 the Kuala Lumpur High Court awarded a summary judgment for a combined sum exceeding RM40 million for unpaid passenger service charges in three civil suits brought by Malaysia Airports Sdn Bhd against AirAsia Berhad and AirAsia X Berhad. The recently released written grounds of judgment for this matter have provided welcome clarification on several important issues for providers of aviation services.
The Ministry of Works has issued a standard operating procedure for the construction industry (Construction SOP), effective for the duration of the Recovery Movement Control Order (RMCO). The ministry has also published FAQs addressing the common queries arising from the Construction SOP. The Construction SOP previously issued by the Ministry of Works for the Conditional Movement Control Order continues to apply for the duration of the RMCO subject to the amendments highlighted in this article.
Following the prime minister's announcement on 1 May 2020 regarding the reopening of the economy, the construction industry is permitted to operate with effect from 4 May 2020. Such operations will be subject to compliance with the standard operating procedure for construction issued by the Ministry of Works.
According to the Malaysian Aviation Commission (MAVCOM), the COVID-19 pandemic constitutes 'extraordinary circumstances' under the Malaysian Aviation Consumer Protection Code. As a result, MAVCOM is temporarily providing some leeway in terms of how airlines can respond to passenger refund requests. However, in doing so, it may have inadvertently exposed passengers to the risk of losing their entire ticket cost.
As Malaysia transitions into the third phase of the Movement Control Order (MCO Phase 3), the government has moved to allow additional economic sectors to operate during this period. This includes construction projects and services related to construction works. However, construction industry players that intend to resume operations during MCO Phase 3 should take note that they must comply with the third set of frequently asked questions issued by the Ministry of International Trade and Industry.