Who watches the regulator?

MALAYSIA’S communications regulator is set to gain significantly broader powers under amendments to the Malaysian Communications and Multimedia Commission (MCMC) Act 1998.

The changes are timely.

Communications infrastructure today underpins everything from cloud computing and artificial intelligence to data centres, digital banking and eCommerce.

As Malaysia pushes ahead with its digital economy ambitions, regulators will inevitably play a bigger role in safeguarding networks, protecting consumers and ensuring the country’s communications infrastructure remains secure and resilient.

Updating the legal framework is therefore a necessary step to keep pace with rapid technological change.

In many respects, strengthening MCMC’s role is justified.

The authority to develop security and interoperability standards should help create a more resilient digital ecosystem as cyber threats become more sophisticated.

Likewise, broader audit powers could improve compliance across an ecosystem that now extends well beyond traditional telecommunications.

However, expanding a regulator’s powers should also prompt a discussion about accountability.

One amendment would allow MCMC to audit not only licensed operators but also “any other person” providing services related to communications systems.

While stronger oversight is understandable, businesses may seek greater clarity on who falls within this scope and how commercially sensitive information will be protected.

The Bill also allows MCMC to publish information on enforcement actions, compounds and regulatory decisions.

Greater transparency is generally welcome as it promotes compliance and gives investors and consumers better visibility into regulatory actions.

At the same time, disclosures should be handled carefully to ensure companies are not unfairly penalised before investigations or legal proceedings have concluded.

Perhaps the move that will face the closest scrutiny is the increase in MCMC’s procurement limit from RM5mil to RM50mil without ministerial approval.

Deputy Communications Minister Teo Nie Ching said the RM50mil limit reflects updated procurement rules, rising costs and technological advancements, replacing the unchanged RM5mil threshold set in 1998.

Faster procurement may be justified given the pace of technological change and cybersecurity challenges.

However, a 10-fold increase in spending authority naturally raises questions about governance, oversight and internal controls.

Greater operational flexibility should be accompanied by equally robust accountability measures.

One positive aspect of the amendments is the move to strengthen the commission’s independence by preventing Members of Parliament and state assembly members from serving as chairman.

Ultimately, the issue is not whether MCMC should have stronger powers.

As Malaysia’s digital economy grows, it arguably needs them.

The bigger question is whether those powers are matched by adequate safeguards.

A trusted regulator is not defined simply by the authority it holds, but by how transparently and responsibly it exercises that authority.

Getting that balance right will be key to maintaining confidence among businesses, investors and the public.