According to Malaysian New Straits Times (NST), the Transport Ministry has announced an exemption of the cabotage policy for all foreign ships engaged in the installation, maintenance and repair of submarine telecommunication cables in Malaysian waters, effective on 1st June 2024.

In a statement on Wednesday (May 29), the Transport Minister Anthony Loke, said the exemption was made under Section 65U of the Merchant Shipping Ordinance 1952.

In March, the Transport Minister Anthony Loke announced the Malaysian government's plan to reinstate cabotage policy exemption for foreign vessels involved in undersea cable repairs.

"Malaysian and international tech companies had, since 2020, voiced the need for the government to adopt a more progressive regulatory framework that can promote more investments in the tech sector. The unity government is committed to accelerating the development of Malaysia's digital infrastructure. The Minister, in exercising the powers conferred by Section 65U of the Merchant Shipping Ordinance 1952, exempts all cable laying ships engaged in the installation, maintenance and repair of submarine telecommunication cable landed at any submarine cable landing centre in Malaysian waters from the cabotage policy under subsection 65KA(1) of the Ordinance." the Minister said.

At the same time, the cabotage exemption for all ships ferrying cargo from any port in Sarawak to any port in Peninsular Malaysia, Labuan and Sabah and vice versa, at the request of the Sarawak government, was also revoked.

The cabotage policy was introduced in 1980 after amendments to the Merchant Shipping Ordinance 1952 to develop Malaysian ownership and local shipping in general.

Under Section 65L of the Ordinance, no ship shall engage in domestic shipping without a license issued by the Domestic Shipping Licensing Board.

The cabotage exemption policy was revoked in 2020 by the former Minister of Transport.

The reinstatement of the cabotage exemption policy, which was widely anticipated, would help to boost investments in digital infrastructure in Malaysia.