By social activist Remy Majangkim
KOTA KINABALU: Deputy Prime Minister Datuk Fadillah recently stated that the interpretation of the Malaysia Agreement has been resolved amicably without court involvement. However, this claim is misleading and obscures the truth.
The issue relates to the oil and gas resources on our continental shelf. To understand the conflict, we must consider the historical context, revisit the Federal Constitution, and assess international legal principles and the current situation.
Borneo Continental Shelf
During the Crown era, the Queen expanded her lands to include Sabah and Sarawak through the Continental Shelf. This extension was made possible by the North Borneo and Sarawak Alteration of Boundary in 1954. It was subsequently recognised in the United Nations Convention on the Law of the Sea in 1982.
United Nations intervention
The formation of Malaysia was officially concluded on September 16, 1963. It was originally scheduled for August 31, 1963, but the date was delayed due to protests from the governments of the Philippines and Indonesia. As a result, the United Nations intervened and facilitated a referendum on the matter, asserting our integration under United Nations resolution XV 1541, Principle 9, which later confirmed our status and was registered in the United Nations Trusteeship Council.
Borneo Oil and Gas and Proclamation of Emergency
Following the formation of Malaysia, the Federation of Malaya enacted the Continental Shelf Act of 1966. This legislation granted the authority to issue licences for oil exploration within the state’s continental shelf. The Act was later extended to the Borneo States under Essential Order No. 7, which reduced its territorial waters from its original extent to just three nautical miles.
This change occurred after a proclamation of emergency was declared following a violent riot in Malaya. It is important to note that the emergency period lasted for 42 years, from 1969 to 2021, until Prime Minister Datuk Najib lifted it.
The following move was to enact the Petroleum Development Act in 1974, which granted PETRONAS ownership, exclusive rights, powers, liberties, and privileges to explore and exploit petroleum resources both onshore and offshore. This included the continental shelf of Sabah and Sarawak, which was taken during periods of emergency.
The lifting of the emergency in 2011 undermined the legality of the Continental Shelf Act of 1966, which suggests that this land should be returned to the Borneo States. However, just a few months later, Parliament approved the Territorial Sea Act of 2012 (TSA2012), which is still based on Essential Order No. 7, the laws in effect during the emergency.
Federal Constitution
Now based on Article 150(7) of the Federal Constitution, all laws enacted during an emergency cease to be enforceable after six months. The new Territorial Sea Act should not be based on a defunct emergency proclamation. But it did; thus, inconsistencies are therefore unconstitutional under Article 4 – Supreme Law of the Federation.
Additionally, under Article 169 (a)(b)(c), the Federation must adhere to the agreement made, recognised by international organisations, with the enforcement date being Malaysia Day.
Lastly, under Article 13(2) – Rights of Property. “No law shall provide for the compulsory acquisition or use of property without adequate compensation.”
Do the Borneo states receive equal reimbursement during this land acquisition by the federal government? Take the example below.
Semantan Estate (Duta Enclave) – In a 12-page judgment released on Monday (Oct 21), Justice Datuk Ahmad Shahrir Mohd Salleh said that due to a botched acquisition, the government was and is still in unlawful occupation of the land. “Prior to the acquisition, the land belonged to the plaintiff (Semantan Estate), and had the acquisition been valid and lawful, the land would belong to the government,” said the judge.
(Quote The Star – 23 October 2024)
The above landmark decision is pertinent to the Borneo Oil and Gas discussion. Can we prove ownership?
International Law
Let us examine the principle of international law. The United Nations defines the “rule of law” as a governance principle where all individuals, institutions, and entities—both public and private, including the State itself—are accountable to laws that are publicly stated, equally enforced, and independently adjudicated and which adhere to international law.
Utis Possendettis Juris
It is a principle of international law that newly independent states should inherit their pre-independence borders. In the case of Sabah and Sarawak, our integration and formation of Malaysia were based on a trusteeship system whereby Malaysia was effectively our trustee, not a new colonial master.
Their actions in absorbing our territory, reducing our boundary and taking over our continental shelf violate this principle. The glaring truth revealed in the enacted Territorial Sea Act 2012 is a continuation of the alteration of our boundary.
Nemo Dat Quad Non Habet
It is a principle of international law that states a person cannot transfer ownership or rights to something they do not legally possess. It is a fundamental rule in property and contract law, particularly when dealing with the transfer of ownership in property transactions.
The transfer of land, particularly ownership, to Petronas under the Petroleum Development Act 1974 again violated it. Sabah and Sarawak have proof of ownership of their continental shelf through the respective North Borneo & Sarawak Alteration of Boundary 1954, enforced by the Sarawak Land Code and Sabah Land Ordinance.
Malaysia Agreement 1963 – Sabah and Sarawak Constitution.
The Malaysia Agreement comprises a written constitution for Sabah, Sarawak, and Singapore. Under Article 49 (Succession of Property) of the Sabah and Sarawak State Constitution, the transfer of title and deeds for land vested by Her Majesty is allocated to the State and its citizens, rather than to any foreign entity.
An important question to consider is whether the Federal Constitution takes precedence over the constitutions of Sabah and Sarawak. The answer is no, due to the Malaysia Agreement and the constitutional safeguards incorporated into the Federal Constitution. Under Article 161E, Sabah and Sarawak hold a distinct status that sets them apart from the states in Malaya. There are significant distributions of power among the founding members of Malaysia, comprised of the 9th and 10th schedules.
Federal law should not overshadow or impose itself on the Borneo states at its whim. Recently, Parliament passed the Carbon Capture, Utilisation, and Storage Bill 2025. This bill may be viewed as reinforcing the Territorial Sea Act of 2012 by granting power to a minister through a gazette. Although this bill applies only to Peninsular Malaysia and the Federal Territories of Labuan, it could complicate the position of the states regarding their oil and gas resources. If and when the State complies with the demand of the Federal Government.
The Sarawak Government is currently endorsing the Territorial Sea Act, despite its significant shortcomings. The Sabah State Government must actively oppose and reject the Territorial Sea Act 2012 to protect Sabah’s future.
You must recognise that this is your land, and you alone hold the title deed. No one else has any claim to it. Bluntly speaking, “Bukan ko punya tanah!”
The recent legal action initiated by the NGO SABAR concerning our Continental Shelf represents a significant affirmation of Sabahans’ awareness and understanding of their rights. It illustrates a growing movement among the people to assert their claims and protect their interests in the face of external challenges.
