KUALA LUMPUR, Oct 13 — Online shoppers could see clearer accountability for e-commerce platforms and sellers under a new law.
Prime Minister Datuk Seri Anwar Ibrahim announced when tabling Budget 2027 that the government had agreed to introduce a new law to replace Malaysia’s Electronic Commerce Act 2006.
If passed by Parliament and brought into force, the proposed legislation would strengthen accountability among online platforms and sellers.
Alongside this move, the government is also examining legislative and enforcement measures to protect local micro, small and medium enterprises (MSMEs) from unfair competition and ensure products bought by consumers are safe.
The move follows the government’s decision to repeal and replace the 2006 Act, which Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali said did not comprehensively define the responsibilities of platforms, sellers and other participants in online transactions.
On September 19, Armizan said the ministry had approved the policy decision to replace the existing law with a more comprehensive framework.
What does the Electronic Commerce Act 2006 not adequately cover?
The Ministry of Domestic Trade and Cost of Living’s (KPDN) through their review of Malaysia’s e-commerce regulatory framework, published in October 2025 had identified gaps in platform accountability and the wider regulatory framework.
There are several areas that the 2006 Act does not adequately address.
Regulating e-commerce platforms directly
The Act does not provide a comprehensive framework governing how online marketplaces must operate or what regulatory obligations they must fulfil.
Clearly defining platform accountability
It does not comprehensively establish the responsibilities of platforms when sellers engage in misleading or potentially harmful practices.
Regulating sellers and their conduct
The Act does not comprehensively regulate online sellers and their businesses.
Addressing cross-border e-commerce
The existing framework does not adequately address regulatory and enforcement challenges posed by overseas sellers and platforms serving Malaysian consumers.
Platform oversight and enforcement
There is no comprehensive legal framework addressing oversight of platforms and ensuring accountability.
Keeping pace with the wider digital marketplace
The Act does not adequately define the roles and responsibilities of intermediaries involved in product visibility, advertising, transactions and access to consumers.
So, what could change for people who shop online?
The Electronic Commerce Act 2006 primarily provides legal recognition for electronic transactions.
A new law could give shoppers greater clarity over a marketplace’s responsibilities when a seller offers misleading products, fails to fulfil an order or engages in questionable practices.
Will platforms have to do more to ensure products are safe?
Product safety is one of the concerns highlighted by the government.
In his Budget 2027 speech, Anwar said the government was examining legislative and enforcement measures to ensure goods bought by consumers were safe.
The government has also raised concerns about foreign e-commerce companies operating in the Malaysian market without adequate oversight. The proposed law is intended to examine a broader framework for regulating platforms and sellers.
Will it become easier to identify a seller?
Identifying the actual seller can be difficult when consumers make purchases through large online marketplaces, particularly when businesses operate from overseas.
KPDN’s review of the e-commerce regulatory framework considered stronger seller identification and information-disclosure requirements, including measures to help establish the identity of businesses operating online.
Such measures could help consumers make more informed purchasing decisions and give authorities better information when investigating complaints.
What if the seller is based overseas?
Cross-border transactions can complicate enforcement when a seller has no registered business entity in Malaysia.
Consumers who receive defective products, do not receive their orders or have disputes over transactions may find it difficult to pursue the seller, particularly if the business operates in another country.
The government has identified the regulation of foreign e-commerce businesses as an area requiring attention.
Armizan has also highlighted regulatory gaps affecting foreign sellers and said the government was studying ways to strengthen platform accountability and the application of Malaysian laws to overseas entities.
Will it be easier to resolve disputes and obtain refunds?
KPDN’s findings identified dispute resolution and consumer redress as areas requiring improvement, including the possibility of a more integrated online dispute-resolution mechanism.
In February, Armizan told Parliament that the ministry was considering a more comprehensive online dispute-resolution platform that could handle the process from filing a complaint to adjudication or a decision.
Such a system could make it easier for consumers to submit complaints and pursue disputes digitally.
Will online marketplaces need a licence?
Licensing is another regulatory option being considered to strengthen oversight of e-commerce platforms.
On September 19, Armizan had in a Bernama report said the government was studying the possibility of introducing a licensing regime, particularly in view of overseas goods entering the market, consumer safety and the sustainability of local MSMEs.
The distinction matters because registration, licensing and other compliance requirements can impose different obligations on businesses.
What happens next?
In his Budget 2027 speech, Anwar announced that the proposed e-commerce Bill would likely be tabled at the next Parliament sitting in March to strengthen accountability among online platforms and sellers.
The Bill’s detailed provisions will determine how far the reforms go, including whether they introduce new obligations for platforms, strengthen oversight of foreign sellers or create additional avenues for consumer redress.
Until the replacement law takes effect, existing legislation — including the Consumer Protection Act 1999 and the Consumer Protection (Electronic Trade Transactions) Regulations 2024 — continues to apply where relevant.