Where things actually stand

Malaysia does not yet have a single comprehensive law governing e-commerce. Instead, online trade is currently governed by several laws and regulations, including the Electronic Commerce Act 2006, the Consumer Protection Act 1999 and the Consumer Protection (Electronic Trade Transaction) Regulations 2024, together with other laws, sector-specific requirements and guidelines depending on the nature of the business and transaction.

There are two practical points about the 2024 Regulations. The first is who they apply to. The Regulations distinguish an online marketplace supplier, meaning a person who trades or advertises through an online marketplace, from an online marketplace operator, meaning a person who makes available or operates the marketplace. The obligation to disclose the prescribed information, and the requirement that the disclosed information be in the national language, fall on the supplier. Operators carry their own separate duties, including ensuring that suppliers provide the required information, making a complaints channel available, and ensuring supplier advertisements do not contravene the Regulations. An operator that permits non-compliant listings is therefore exposed through its own gatekeeping duty rather than through the supplier’s.

The second point is enforcement. The Regulations took effect with a six-month grace period which ended on 24 June 2025, after which enforcement was to begin. Enforcement was subsequently reported to have been deferred by KPDN in June 2025 until further notice, communicated to marketplace operators rather than a gazetted amendment. The Regulations remain in force, and the timing of enforcement can change without extended notice.

That is changing. The Ministry of Domestic Trade and Cost of Living (“KPDN”) has completed its review of Malaysia’s electronic commerce law, and the final report, dated October 2025, is published on the ministry’s website. In June 2026 the Minister said the study began in April 2024 and that a Cabinet memorandum on the proposed policy would be tabled at the first Cabinet meeting in July 2026.

The pace has since picked up. On 20 August 2026 the Prime Minister directed that the drafting of the Bill be expedited, saying at the TikTok Shop Summit Malaysia that it could be approved as early as October if the final form is workable for industry and for new entrepreneurs. On 22 August 2026 the Minister of Domestic Trade and Cost of Living confirmed that the new law will replace the Electronic Commerce Act 2006, on the basis that the 2006 Act validates electronic transactions but does not set out the responsibilities of the platforms, sellers and users operating within the e-commerce ecosystem. The Minister confirmed that the memorandum had been submitted, that KPDN is working with the Attorney General’s Chambers, the Ministry of Communications, MCMC and the Ministry of Digital on the drafting, and that the Bill is scheduled to be tabled at the upcoming parliamentary session. The Dewan Rakyat’s next meeting runs from 5 October 2026 to 8 December 2026, with Budget 2027 tabled on the opening day. In other words, the shape of the reform is known but the detail is not. Businesses that review their current practices now will be better placed to assess what the Bill requires of them when it appears, rather than starting from a blank page.

What the Bill is likely to address

The final Bill has not been published, so the details may still change. However, ministerial statements and KPDN’s final report point consistently in a few directions.

• Platform accountability. KPDN proposes clearer responsibilities for intermediary platforms, including stronger identity-verification measures, keeping relevant transaction records, taking action against listings or content that breach existing laws, providing ways for users to flag potentially unlawful content, and cooperating with the relevant authorities.
• Fair treatment of sellers. The report identifies concerns about the bargaining power of platforms over sellers. Proposed measures include clearer notice of changes to platform terms and fees, greater fee transparency, handling business complaints within a reasonable time, clearer reasons for termination, and a commitment not to retaliate against sellers who complain. The report also proposes that an intermediary which sells its own products on its platform should not discriminate against, or impose oppressive terms on, competing sellers in order to favour its own.
• Enforcement reach over foreign operators. KPDN highlights the difficulty of enforcing Malaysian requirements against foreign e-commerce platforms and sellers without a physical or legal presence in Malaysia. The report proposes that foreign e-commerce platforms and sellers operating in the Malaysian market may be subject to Malaysian law, and that e-commerce platforms operating in the Malaysian market may be required to appoint a registered legal representative in Malaysia.
• Stronger consumer protection. The report also proposes measures dealing with fair online contracts, clearer information for consumers, refunds and returns, online advertising, recommendation systems and dispute resolution.
• Better coordination and enforcement. As e-commerce can involve several regulators and different areas of law, KPDN proposes a more coordinated approach to regulation, investigation and enforcement.

One important issue is scope. The report distinguishes between intermediaries (including digital platforms and e-marketplaces), sellers (including e-retailers and online merchants), and online consumers, and some proposed obligations apply only to particular categories or are subject to specific exclusions. Financial services sit outside the review’s coverage altogether, on the basis that they fall under a separate regulatory framework. Businesses should therefore consider their role and activities in e-commerce rather than assume that every business selling online will be treated in the same way.

There is already a worked example of this in force. The 2024 Regulations allocate obligations between the online marketplace supplier and the online marketplace operator, and give each a different set of duties. Commentators differ on whether a business selling its own goods through its own website falls within the 2024 Regulations at all, given that “online marketplace” is defined by reference to an electronic trade platform. The proposed framework points in a clearer direction. The report’s coverage categories place a business selling directly to consumers through its own website or application as an e-retailer, which sits with sellers rather than intermediaries. The report also indicates that the platform obligations would not apply to digital platforms carrying their own products and services, or that do not have many sellers. It does not address the position of a business that sells its own goods alongside third-party sellers. Either way, the question is answered by what the service does rather than by how the business describes itself, and it is the same question the proposed Bill is expected to ask on a larger scale.

The part most businesses are missing: it does not arrive alone

The proposed E-Commerce Bill is not the only regulatory development businesses should be watching. The Competition (Amendment) Bill 2026, together with the Competition Commission (Amendment) Bill 2026 were passed by the Dewan Rakyat on 6 July 2026 and by the Dewan Negara on 27 July 2026. The amendments are directed at anti-competitive conduct, including cartel activity and abuse of a dominant position. They strengthen the Malaysia Competition Commission’s investigation and enforcement powers, introduce a new settlement mechanism, narrow the existing undertaking regime, and extend the existing records offence so that an attempt to destroy, conceal or alter records to obstruct an investigation is itself an offence. Notably, a general merger control regime was not included in the amendments, so mergers and acquisitions remain largely outside Malaysian competition law for now, with reform indicated for the 13th Malaysia Plan period. The Bills had not come into force as at the date of this article. Businesses should confirm the current position before relying on them.

For platform businesses, issues such as platform fees, seller terms and the treatment of sellers may also raise competition concerns. Competition law may become relevant where arrangements restrict competition or where a dominant platform uses its market power unfairly. Businesses should therefore consider the proposed e-commerce reforms and competition law together where relevant.

Data protection is also relevant, because some of the proposed e-commerce measures involve collecting and handling personal data, such as verifying users or keeping transaction records. Malaysia’s amended framework under the Personal Data Protection (Amendment) Act 2024, together with the guidelines and circulars issued by the Personal Data Protection Commissioner, introduced requirements that may apply to e-commerce businesses. Since 1 June 2025 these include the appointment of a Data Protection Officer (DPO) by controllers and processors that meet the prescribed criteria, notification of personal data breaches that meet the applicable threshold, and data portability requests. Separately, since 1 April 2025 the maximum penalty for breaching the data protection principles has been RM1 million, and the whitelist regime for transfers of personal data outside Malaysia has been replaced by a test based on comparable law or an adequate level of protection. Businesses should check which of these requirements apply to them.

What we would do now

Many of the following steps can be taken before the final Bill is published. They can help businesses understand their current practices and identify areas that may need attention once the Bill is tabled.

• Assess whether you may fall within the proposed intermediary or marketplace categories. Map the features of your service that connect buyers and sellers or facilitate transactions, payments, delivery or post-purchase support. (For more details, please see ↗ Could Your Service Be an Intermediary or E-Marketplace? A Scope Self-Assessment)
• Review your seller onboarding. Consider what information you collect about sellers, how identities are verified and what records you keep.
• Document how you deal with unlawful content, user reports and business complaints. Consider how these are reviewed, how decisions are recorded and how business complaints are handled within a reasonable time.
• Read your platform-seller agreement. Pay particular attention to changes to platform terms and fees, how those changes are notified, fee transparency, complaint handling and reasons for termination. If you sell your own products alongside third-party sellers on your platform, review how ranking, exposure and commercial terms differ between the two.
• If you operate from outside Malaysia, consider whether the proposed rules for foreign operators may affect your business. If you operate an e-commerce platform, consider the proposed requirement to appoint a registered legal representative in Malaysia.
• Review your consumer-facing terms and practices. This includes key information provided to consumers, refunds and returns, online advertising and dispute-resolution processes.
• Review your data protection practices. Check whether a DPO is required, whether your procedures for responding to personal data breaches are up to date, and whether any transfers of personal data outside Malaysia meet the applicable requirements. (For more details on this, please see ↗ Data Protection: What E-Commerce Businesses Should Check)

A note on timing

Regulatory change of this kind rarely rewards early panic or late reaction. The useful work in this period is mapping activities and documenting existing processes. Substantive changes to contracts or business structures are better made once the Bill has been tabled and its terms are known.

A business that understands how its own operations work will be better placed to assess which requirements apply to it, and what needs to change, once the Bill is published. That assessment is far quicker when the underlying mapping has already been done. 

When the Bill is tabled

We will publish an analysis of the Bill shortly after it is tabled, covering the final text and what it means in practice for platforms, sellers and foreign operators. If you would like to receive it, subscribe to our e-commerce updates by completing the form below.

Speak to Our Partner

Ong Wei Jie

wei.jie.ong@joclawyers.com

For advice on Malaysia’s proposed E-Commerce reforms, platform regulation and related commercial compliance matters.

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This article is current as at 28 August 2026 and reflects the position at that date. It is provided for general information only and does not constitute legal advice or create a solicitor-client relationship. The E-Commerce Bill has not been published, the proposals described in this article are drawn from KPDN’s final report and ministerial statements, and the Bill as tabled may differ. Legislation, regulations and enforcement practice referred to in this article may change after the date above. You should obtain advice on your specific circumstances before acting or refraining from acting on anything in this article. JOC accepts no liability for any loss arising from reliance on it. For further information, please contact hello@joclawyers.com.