Decolonisation, self-determination and referendum

The issue of self-determination with respect to the peoples of North Borneo, Sarawak, and Singapore formed the bedrock of yet another challenge to the formation of the Federation of Malaysia. Under the Joint Statement issued by the British and Malayan Federal Governments on 23 November 1961, clause 4 provided: Before coming to any final decision it is necessary to ascertain the views of the peoples. It has accordingly been decided to set up a Commission to carry out this task and to make recommendations ........

In the spirit of ensuring that decolonisation was carried in accordance with the wishes of the peoples of North Borneo, the British Government, working with the Federation of Malaya Government, appointed a Commission of Enquiry for North Borneo and Sarawak in January 1962 to determine if the people supported the proposal to create a Federation of Malaysia. The five-man team, which comprised two Malayans and three British representatives, was headed by Lord Cobbold.^[11]

In Singapore, the People's Action Party (PAP) sought merger with Malaysia on the basis of the strong mandate it obtained during the general elections of 1959 when it won 43 of the 51 seats. However, this mandate became questionable when dissension within the Party led to a split. In July 1961, following a debate on a vote of confidence in the government, 13 PAP Assemblymen were expelled from the PAP for abstaining. They went on to form a new political party, the Barisan Sosialis, the PAP's majority in the Legislative Assembly was whittled down as they now only commanded 30 of the 51 seats. More defections occurred until the PAP had a majority of just one seat in the Assembly. Given this situation, it would have been impossible to rely on the mandate achieved in 1959 to move forth with merger. A new mandate was necessary, especially since the Barisan argued that the terms of merger offered were detrimental to the Singapore people (such as having reduced seats in the federal parliament compared to its population, only being able to vote in Singapore elections,^[12] and the obligation that Singapore contribute 40% of its revenue to the federal government). In order to allay these concerns, a number of Singapore-specific provisions were included in the Agreement.^[13]

While Brunei sent a delegation to the signing of the Malaysia Agreement, they did not sign as the Sultan of Brunei wished to be recognised as the senior ruler in the federation.^[14]

On 11 September 1963, just four days before the new Federation of Malaysia was to come into being, the Government of the State of Kelantan sought a declaration that the Malaysia Agreement and Malaysia Act were null and void, or alternatively, that even if they were valid, they did not bind the State of Kelantan. The Kelantan Government argued that both the Malaysia Agreement and the Malaysia Act were not binding on Kelantan on the following grounds that the Malaysia Act in effect abolished the Federation of Malaya and this was contrary to the 1957 Federation of Malaya Agreement that the proposed changes required the consent of each of the constituent states of the Federation of Malaya – including Kelantan – and this had not been obtained. This suit was dismissed by James Thomson, then Chief Justice, who ruled that the constitution had not been violated during the discussion and creation of the Malaysia Act.^[15][16]

Recent developments

After the proposed 2019 amendment to the Constitution of Malaysia on the equal status of Sabah and Sarawak failed to pass, the Malaysian federal government agreed to review the agreement to remedy breaches of the treaty with a "Special Cabinet Committee To Review the Malaysia Agreement".^[17][18] The seven agreed issues were:

• Export duty claims on logging exports and forest products.
• Gas distribution and regulatory powers on electricity and gas.
• Implementation of Federal and State Public Works.
• Manpower.
• The power of the state on health issues.
• Administration of Sipadan and Ligitan islands for Sabah.
• Agricultural and forestry issues.

The first meeting about these issues was held on 17 December 2018.^[18] Despite the willingness of the federal government to review the agreement, reports surfaced that negotiations between Sabah and the federal government had not been smooth, with the latter dictating some matters of the review, causing the perception that the review was a one-sided affair with the government appearing reluctant to relinquish control of affairs.^[19]

In 2021 amendment to the Constitution of Malaysia, Article 160 (2) of the federal constitution was amended with the new definition of the term "federation" where the Malaysian federation is formed in accordance to the 1963 Malaysian agreement in addition to 1957 Malaya agreement.^[20]

In March 2022, 11 people from Sarawak filed writ into the High Court of Sarawak to declare the Malaysia agreement null and void because the people of Sarawak did not unconditionally exercise self-determination nor referendum was held before the formation of Malaysia. Therefore, Sarawak would not bind to the Malaysia agreement.^[21] In April 2022, Government of Sarawak tried to strike to out the suit on reasons that the High Court had no jurisdiction to enforce or nullify an international treaty like MA63.^[22] In May 2023, The high court in Kuching dismissed the suit because the Federal Constitution of Malaysia is the supreme law of the country and for Sarawak to leave the federation, the Federal Constitution needs to be amended.^[23]