Malaysia Introduces New EEZ Regulations: What the Shipping Industry Needs to Know

Malaysia has introduced the Exclusive Economic Zone Regulations 2026 (“EEZ Regulations”), marking an important development in the regulation of shipping activities within Malaysia’s Exclusive Economic Zone¹ (“EEZ”) and continental shelf². The EEZ Regulations codify, and in certain respects extend beyond, several provisions of the United Nations Convention on the Law of the Sea 1982 (UNCLOS), bringing domestic regulations more closely in line with contemporary international maritime environmental standards.

The EEZ Regulations came into force on 29 June 2026 and establish a detailed regulatory regime aimed at protecting the marine environment, regulating high-risk maritime operations, and enhancing enforcement powers against vessels operating within Malaysia’s EEZ and continental shelf.

The enactment of the EEZ Regulations coincides with reports of an increase in ship-to-ship cargo transfers in Malaysia’s Eastern Outer Port Limits, a 1,200-square-kilometre area in the South China Sea approximately 70 km offshore, including reports that the area has been used for transfers involving crude oil from Iran, Russia and Venezuela, some of which may be subject to international sanctions.

Key Developments

A. Introduction of Marine Sensitive Areas

1. Under Regulation 3 of the EEZ Regulations, the Government may designate any area within Malaysia’s EEZ or continental shelf as a Marine Sensitive Area (“MSA”) for purposes including:
   
   • Protecting flora, fauna and marine habitats, marine structures, or any site comprising the remains of any vessel, aircraft, installation or structure of historic or archaeological interest;
   • Protecting offshore installations and structures;
   • Preventing and controlling marine pollution;
   • Protecting installations and structures for the exploitation and exploration of the EEZ or the continental shelf;
   • Protecting Malaysia’s coastline from pollution arising from maritime casualties; and
   • Facilitating restoration following marine pollution incidents.
2. Each MSA designation must specify the boundaries of the protected area, the objectives of the designation, and the protective measures applicable within that area. In addition, where urgent protection is required, the Government may issue an interim notice establishing temporary protective measures before a formal MSA designation is made.

B. Broad Powers to Regulate Activities Within an MSA

3. Once an MSA has been designated, the Government may impose a wide range of navigational and operational restrictions. These include:
   
   • Prescribing navigation routes or sea lanes;
   • Restricting or prohibiting entry into the area;
   • Restricting particular categories of vessels;
   • Imposing speed limits;
   • Prohibiting the killing, taking, destruction or disturbance of flora and fauna;
   • Prohibiting activities that may damage the seabed or protected features;
   • Restricting fishing activities; and
   • Imposing any other measures considered necessary.
4. Failure to comply with these protective measures constitutes an offence.

C. New Controls Over Ship-to-Ship (“STS”) Cargo Transfers

5. The EEZ Regulations introduce, for the first time, a comprehensive approval regime governing STS cargo transfers within Malaysia’s EEZ and continental shelf.
6. Pursuant to the EEZ Regulations, all STS cargo transfers are generally prohibited unless prior written permission is obtained from the Government. Certain exceptions apply, including transfers involving:
   
   • Warships or naval auxiliary vessels;
   • Government vessels;
   • Vessels owned, operated or licensed to carry out activities authorised by the Government under Malaysian law; and
   • Emergency operations necessary for vessel safety, saving life at sea or combating marine pollution.
7. Applications for approval to perform STS cargo transfers must be submitted at least 48 hours before the planned transfer and must include extensive supporting documentation, including, among other things, a copy of the vessel-to-vessel operation plan.
8. The Government may impose conditions on any approval granted, and operators remain under a continuing obligation to provide updated information until completion of the transfer operation.
9. Knowingly providing false information for the purpose of obtaining approval, or failing to conduct the STS cargo transfer operation in accordance with the approved vessel-to-vessel operation plan, constitutes an offence.

D. Prohibition on Bunkering Operations Within the EEZ

10. Perhaps the most commercially significant change is the prohibition against bunkering operations within Malaysia’s EEZ and continental shelf.
11. The EEZ Regulations generally prohibit transfers of bunkers between vessels, subject only to limited exceptions involving bunkering operations:
    
    • Between a vessel and its lifeboats;
    • To or from a warship or naval auxiliary vessel;
    • To or from any other vessel owned, operated or licensed to carry out activities authorised by the Government or other written law;
    • To or from any other vessel owned or operated by the Government and used solely for Government non-commercial purposes; and
    • For search and rescue operations and for combating any specific pollution incidents.
12. Any owner, master or agent of a vessel who contravenes the above regulations commits an offence.

E. Enhanced Enforcement Powers

13. The EEZ Regulations also strengthen the enforcement powers available to authorised officers.
14. Where there are reasonable grounds to believe that a vessel has contravened the EEZ Regulations or applicable international pollution standards, authorised officers may:
    
    • Require information regarding the vessel;
    • Conduct physical inspections where information is refused or appears inaccurate; and
    • Detain vessels where violations result in pollution causing damage or a threat of damage to Malaysia’s EEZ or continental shelf.
15. The EEZ Regulations further permit the release of detained vessels upon the provision of a bond or financial security of up to RM1 million, while allowing the Government to recover custody costs as a civil debt.

F. Creation of Additional New Offences

16. The EEZ Regulations create several new offences, including:
    
    • Damaging protected features within an MSA;
    • Intentionally anchoring within an MSA, subject to emergency exceptions; and
    • Damaging submarine cables or pipelines within the EEZ or continental shelf.

G. Conclusion

17. The EEZ Regulations mark a significant step in strengthening Malaysia’s regulatory framework for activities conducted within its EEZ. In addition to expanding the approval and reporting regime for certain offshore operations, the Regulations also reinforce environmental protection and enhance the enforcement powers of the relevant authorities.
18. Companies operating vessels within Malaysian waters should review their operational procedures to ensure compliance with the new approval requirements, reporting obligations and environmental restrictions. Particular attention should be given to voyage planning, STS transfers, bunkering arrangements and emergency response procedures, especially where operations are conducted within or near a designated MSA.