Course: Maritime Transportation Management

Subject: Law of Carriage of Goods by Sea

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Note1: Sources of Malaysian Maritime Law

Historical Background/ Origin

The earliest recorded maritime law in the country was found in the Malacca Maritime Code
– Compiled during the reign of Sultan Muhammad Shah in 1424. The laws may be
formulated much earlier sometime around 13th Century but during the reign of Sultan
Muhammad Shah, the Sultan consented that the laws be compiled for easy reference and
use.

Sources of Malaysian Maritime Law

Malaysian Courts generally apply English maritime law principles but the application is
subject to local adaptation.
The Civil Law Act 1956 provides for the application of English law in respect of issues in
relation to the law of carriage by air, land, sea, marine insurance unless provision has been
made by other written law.
(See Section 5 CLAon the differences as to the date of its application in Malacca, Penang,
Sabah & Sarawak as against the rest of Peninsula Malaysia).

Sources of Malaysia Maritime Law:

- Common law
- International Conventions
- Malaysian Legislation
- Subordinate Legislation

Common Law
The admiralty jurisdiction of the High Court is largely governed by statute. The Courts of
Judicature Act 1964 provides that the High Court will have the same jurisdiction and
authority in relation to matters of admiralty as is had by the High Court of Justice in England
under the Supreme Court Act 1981.
(Section 24(b) of the Malaysian Court of Judicature Act 1964)
“ Civil jurisdiction—specific

24. Without prejudice to the generality of section 23 the civil

jurisdiction of the High Court shall include—

(b) the same jurisdiction and authority in relation to matters

of admiralty as is had by the High Court of Justice in
England under the United Kingdom Supreme Court Act 1981;”

By virtue of the Civil Law Act 1956 (section 5) English law in respect of issues in relation to
the law of partnership, corporations,carriers by air, land, sea and marine insurance etc. is
applied by the Malaysia High Court save and except provision has been made by other
written law.

International Conventions
Conventions relating to maritime law have been incorporated into Malaysia law in the
following ways:-
1. By an Act embodying, in its own words, provisions having the effect of the
Convention; or
(Example: MSO 1952, section 307(3), Schedule 8 (load lines)
2. By an Act embodying the original text of the Convention itself, usually in a Schedule,
with separate changes to be made under Malaysia law for the statutory operation of
the Convention.
(Example: International Convention on Standards of Training, Certification and
Watchkeeping for Seafarers 1978 as amended in 1995 in the Merchant Shipping
(Manning, Hours of Work and Watchkeeping) Rules 1999).

Some of the International Conventions which have been rectified by Malaysia are:-
- International Convention for the Unification of Certain Rules of Law relating to Bills
of Lading (Brussels, 25th August 1924), (The Hague Rules)
(The text of the Hague Rules was substantially embodied in the Carriage of Goods by
Sea Act 1950 (Act 527) Schedule 1. In Sarawak, the Hague Rules are applied vide the
Merchant Shipping (Implementation of Conventions relating to Carriage of Goods by
Sea and to the Liability of Shipowners and Others) Regulations 1960. This Sarawak
regulations are given statutory effect in Sabah by the Merchant Shipping (Applied
Subsidiary Legislation) Regulations (No. 39 of 1961)).
- International Convention for the Safety of Life at Sea 1966
 (See MSO 1952, Part V, sections 250-306A)

- International Convention on Load Lines 1966

(MSO 1952, Part VI, sections 307-331A)

- International Convention on Civil Liability for Oil Pollution Damage 1969

(The Convention commonly known as the Civil Liability Convention was rectified by
Malaysia on 6 January 1995 and implemented under the Merchant Shipping (Oil
Pollution Act) 1994, Part II (ss 3 – 14) of the Act provides for the strict liability against
shipowners for oil pollution).
- International Convention on Tonnage Measurement of Ships 1969
(Rectified in April 1984, implemented by regulations under the MSO 1952 s 57, see
Merchant Shipping (Tonnage) Regulations 1985)

- International Convention on the Establishment of an International Fund for

Compensation for Oil Pollution Damage 1971
(The Convention commonly known as the Fund Convention was rectified in January
1995, implemented under Merchant Shipping (Oil Pollution) Act 1994. The Fund
Convention supplements the Civil Liability Convention by providing compensation to
persons affected by Marine Pollution who cannot obtain full or adequate damages
from shipowner. The Fund is established by contributions levied on oil receivers
whose output exceeds stipulated quantity).

- International Convention for the Prevention of Pollution from Ships 1973

(Commonly known as MARPOL 73/78, this is the primary convention relating to the
regulation and control of pollution from ships. The Convention deals with all forms of
marine pollution except the disposal of land generated waste dumped into sea.
Malaysia became a party to Annex I & II and the optional Annex V on Garbage on
January 1997. Annex I & II of MARPOL 73/78 covers oil and noxious liquid substances
and Annex V covers garbage generated on board ships Annex III covers harmful
substances carried in packages eg tanks and containers and Annex IV covers sewage).

- International Convention for the Safety of Life at Sea (SOLAS) 1974

(The Convention was implemented in Malaysia vide MSO 1952 Part V (ss 250 – 306A).
The Convention commonly known as SOLAS, is the most important international
convention dealing with maritime safety.
 The convention is to ensure that flag states of signatory countries have their ships
comply with the minimum safety standards in construction, equipment and
operation).

- The International Convention Relating to the Limitation of Liability of Owners of Sea-

going Ships 1957
(The Convention provides for a specific sum to be multiplied by the ship’s tonnage to
produce the limitation amount. Limitation under this Convention is not available
where the occurrence giving rise to claim resulted from the actual fault or privity of
the owner. MSO 1952 s 360).

- The International Convention on Standards of Training, Certification and

Watchkeeping for Seafarers as amended in 1995
(Implemented in Malaysia by the Merchant Shipping (Training and Certification)
Rules 1999, Merchant Shipping (Manning, Hours of Work and Watchkeeping) Rules)
1999 and Merchant Shipping (Medical Examination) Rules 1999. The Convention
establishes standards for the deck department, engine department and radio
department and deals with all members the complement).
- International Convention on the Control of Transboundary Movement of Hazardous
Waste and their Disposal 1989
(The Convention is commonly known as the Basel Convention 1989and came into
force on January 1994. Malaysia rectified the Convention on 12 August 1993. Primary
objective of the Basel Convention is to regulate Transboundary movements of toxic
and hazardous waste through a system of notification and obtaining prior informed
consent from the competent authorities of the countries affected. The provisions of
the Convention have been incorporated into Malaysia environmental and custom
laws. Environmental Quality Act 1974 , Part IVA (ss 34B) control of Scheduled Wastes,
Environmental Quality (Prescribed Premises)(Scheduled Wastes Treatment and
Disposal Facilities) Regulations 1989, Custom (Prohibition of Export)(Amendment) No
2 Order 1993).

UNITED NATIONS CONVENTION ON THE LAW OF THE SEA 1982

The United Nations Convention on the Law of the Sea 1982 (UNCLOS) was adopted at
Montego Bay, Jamaica on 10 December 1982.
Malaysia rectified the Convention on 14 October 1996
The 1982 Convention was comprehensive and covered:-
(1) Introduction;
 (2) The territorial sea and contiguous zone;
(3) Straits used for international navigation;
(4) Archipelago States;
(5) Exclusive Economic Zones;
(6) The Continental Shelf;
(7) The High Seas;
(8) Regime of islands;
(9) Enclosed or Semi-enclosed seas;
(10) Right to access of land-locked States to and from the sea and freedom of transit;
(11) The Area;
(12) Protection and Preservation of the Marine Environment;
(13) Marine Scientific Research;
(14) Development and Transfer of Marine Technology;
(15) Settlement of Disputes
(16) General Provisions;
(17) Final Clauses;
(18) Annexes.
International Tribunal for the Law of the Sea

The International Tribunal for the Law of the Sea was established in accordance with Annex
VI of UNCLOS 1982 to deal with the settlement of disputes

International Sea-Bed Authority

The International Sea-Bed Authority was established under UNCLOS. It is the organisation
through which State Parties organise and control all activities of exploration for, and
exploitation of, the resources of the sea bed and ocean floor and its subsoil, beyond the
limits of national jurisdiction.

International Maritime Organisation

The International Maritime Organisation was established under a Convention which came
into force in 1958 (Convention on the International Maritime Organisation 1948).

The purpose of the Organisation are:

1. To provide machinery for co-operation among governments in the field of
governmental regulation and practices relating to technical matters affecting
shipping engaged in international trade;
 2. To encourage and facilitate the general adoption of the highest practicable standards
in matters concerning the maritime safety, efficiency of navigation and prevention
and control of marine pollution from ships;

3. To encourage the removal of discriminatory action and unnecessary restrictions by

governments affecting shipping so engaged;

4. To consider unfair restrictive practices by shipping concerns;

5. To consider shipping matters referred to the Organisation by any organ or

specialised agency of the United Nations; and

6. To provide for the exchange of information between governments on matters under

consideration.

The functions of the Organisation are consultative and advisory. In general membership of
the organisation is open to all States.
The Organisation consists of an assembly, a council, a maritime safety committee, such
subsidiary organs as the Organisation may at any time consider necessary and a secretariat.
The headquarters of the Organisation are in London. The Organisation which is in
relationship with the United Nations, must co-operate with the United Nations’ specialised
agencies, and may co-operate with other international organisations and in certain
circumstances take over functions from such organisations.
Malaysia acceded to the International Maritime Organisation Convention on 17 June 1971.
The acceptance of the Convention will not have the effect of altering or modifying in any
way the law in force in Malaysia.

Malaysian Legislation

The Merchant Shipping Ordinance 1952 (FM Ord No 70 of 1952) is the principal
consolidation Act relating to merchant shipping in Malaysia (Peninsula Malaysia).
In Sarawak - Merchant Shipping Ordinance (No 2 of 1960)
In Sabah – Merchant Shipping Ordinance (No 11 of 1960)
(The application of certain provisions of the Merchant Shipping Act 1894 (UK) and
subsequent amendments are preserved in the Sarawak and Sabah merchant shipping
legislation).
 In addition to the statutory control imposed by the Ordinance, the following related matters
are subject to statutory control:-
(1) the carriage of goods by sea and (2) collisions;
(Carriage of Goods by Sea Act 1950 where the Hague Rules was incorporated as a Schedule
to the Act and the Merchant Shipping (Collision Regulations) Order 1984 which incorporates
the International Regulations for Preventing Collisions at Sea 1972 (COLREGs)).
(3) The Port Authorities Act 1963 regulates the powers, functions and duties of Port
Authorities in Malaysia;

(4) Merchant Shipping (Oil Pollution ) Act 1994 provides for the strict liability against
shipowners for oil pollution damage
Subsidiary Legislations
- Merchant Shipping (Tonnage) Regulations 1985 incorporates the International
Conventions on Tonnage Measurement.
- Merchant Shipping (Training and Certification) Rules 1999
- Merchant Shipping (Manning, Hours of Work and Watchkeeping) Rules 1999
- Merchant Shipping (Medical Examination) Rules 1999