Located in Southeast Asia, Malaysia is home to an ethnically diverse population of roughly 32.9 million people. The country’s religious composition is equally diverse. Islam is the official religion, and approximately 61% of citizens practice it. In addition to the Muslim majority, Malaysian society includes Sri Lankan Malaysians, Chinese Malaysians, Indian Malaysians, and other minority groups.
The country is a federal constitutional monarchy that comprises 13 states, known as Negeri, along with three federal territories, or Wilayah Persekutuan (Kuala Lumpur, Putrajaya, and Labuan). Malaysia’s history can be traced back to the 3rd century AD, when the first Malay kingdoms emerged. The British Empire established a strong presence in the region in the early 18th century. The country did not fully regain its independence until the late 1950s.
Gambling law is complex in Malaysia, as it is in many multi-ethnic nations. Much of the complexity stems from the fact that Islamic Sharia law strictly prohibits gambling. As a result, Malaysia’s Muslim population cannot legally enter gaming venues or participate in such activities. Despite this, gambling has gained social acceptance in the country, at least among non-Muslim Malaysians.
Brick-and-mortar gambling is legal in Malaysia, but Resorts World Genting remains the only casino resort complex at present. The country also has several turf clubs and racecourses with histories dating back to the late 19th century. Land-based sports wagering is legal as long as bookmakers obtain the proper licenses. All forms of online gambling remain illegal. The prohibition extends to all Malaysian citizens, regardless of their religious beliefs.
Laws That Govern Gambling in Malaysia
Several laws have shaped Malaysia’s gambling industry as we know it today. The first, and arguably most important, piece of legislation governing gambling activities in the country is the 1953 Betting Act (Akta Pertaruhan). It has been amended several times over the years, but its original purpose was to eliminate illegal betting houses and prevent wagering in public places.
The 1953 Betting Act
The Common Gaming Houses Act of 1953
The Lotteries Act of 1952 and the Racing Act of 1961
The 1953 Betting Act
The 1953 Betting Act prohibits all forms of betting unless those who operate them have obtained proper licenses to do so. It provides a legal definition of the term “common betting house,” describing it as any site used for habitual wagering on sporting events such as races, matches, and fights. The law also refers to telecommunication systems, defining them as any means people use to communicate over a distance, including telephones and telegraphs.
The legislation passed in the early 1950s, so it understandably makes no direct reference to internet technologies. Nonetheless, its wording is broad enough that the law could potentially apply to online gambling. The legislation proceeds to state that running, leasing, and owning a common betting house is contrary to Malaysian law, and is therefore punishable upon conviction.
Individuals found guilty of this offense are liable for pecuniary sanctions ranging from RM20,000 to RM200,000. Convicted persons can also be sentenced to prison for a maximum term of five years. Further on in the text, it becomes apparent that wagering in one such common betting house is also a legal violation under the 1953 Act.
The punishment for Malays who commit this offense is a fine of up to RM5,000 or a maximum imprisonment term of six months. In the worst-case scenario, the gambler may receive both penalties. The law presumes individuals found in unauthorized betting facilities have engaged in gambling there until their innocence is proven. Those who act as illegal bookmakers are liable for imprisonment of up to five years and pecuniary sanctions of up to RM200,000.
The 1953 Betting Act prohibits Malays from publishing the results of lotteries and horse races in print or announcing them orally. However, this prohibition does not apply to results published in newspapers licensed under the provisions of the Malay Printing Presses and Publications Act of 1984. The legislation also makes exceptions for the Totalizator Board operating under the Racing Act of 1961 and lotteries authorized under the Lotteries Act of 1952.
Police officials have the authority to inspect private premises on suspicion of illegal betting. Obstructing or delaying their entry is also a violation of the 1953 Betting Act. Citizens who inform the authorities about a common betting house are eligible for rewards. Magistrates can partially or fully redirect the fines imposed on convicted individuals to the informers.
The Common Gaming Houses Act of 1953
The 1953 Betting Act primarily concerns sports wagering and bookmakers, whereas the 1953 Common Gaming Houses Act applies to other forms of gambling. It provides a lengthy definition of what gambling is, describing it as any activity that involves staking money on games based solely on chance or on a blend of skill and chance.
Running, letting, or owning a common gaming house is contrary to Malaysian law. The same applies to participating in the gambling activities offered in such illicit facilities. If caught and convicted, violators face various penalties depending on the severity of their transgression. Previously, sanctions for illegal gambling in these venues amounted to six months in jail and fines of up to RM5,000, or both.
However, Malaysia’s Minister of Finance, Lim Guan Eng, introduced higher minimum fines of RM100,000 as part of the country’s 2020 budget plan (Section 200). The minimum mandatory imprisonment term for illegal gamblers became half a year. For operators of illegal gaming houses, the budget plan proposed minimum jail sentences of one year along with minimum fines of RM1 million.
Similar to the Betting Act, the law on common gaming houses empowers police authorities to enter and inspect private premises on suspicion of illegal gambling. The authorities also have the right to confiscate gaming machines and other gambling equipment they find under Article 16A of the 1953 Common Gaming Houses Act.
The Minister of Finance has the remit to grant licenses to businesses registered under the 1965 Companies Act, allowing them to market and legally operate gambling games. Licensees are subject to various levies, unlike their illegal counterparts. According to Section 27A (1)(c), the permits are valid for three months, after which the Finance Minister can renew them at his sole discretion.
Licensees who contravene their permits’ terms risk revocation. At the time of writing, Malaysia has a single legal land-based casino, Resorts World Genting. The regulatory entity that oversees its operations is the Betting Control Unit, which is part of Malaysia’s Ministry of Finance. The casino can legally offer various gambling games, including baccarat, blackjack, house-banked varieties of poker, roulette, and boule (a ball game). Tai sai and mini dice are available to patrons who prefer rolling the bones.
The Lotteries Act of 1952 and the Racing Act of 1961
Lotteries are the most widespread form of gambling worldwide, with many countries running at least one state-operated national lottery. Malaysia is no exception, as it regulates this activity under the 1952 Lotteries Act. Running a lottery is lawful under this legislation, provided that operators have received authorization from Malaysia’s Minister of Finance.
The 4D is the most common lottery format in the country, where players choose a number from zero to 9,999 and win if their pick is among the 23 numbers drawn. At the time of writing, the country has six authorized lotteries, all of which are owned by private businesses. Running illegal lotteries is, however, not unheard of in Malaysia.
The industry intelligence service Asian Gaming Brief reported that unauthorized lottery operators earned approximately 60% more revenue in 2018 than all licensed lottery businesses combined. Malaysian police forces attempt to curb such illicit operations by conducting regular raids.
Betting on horse races is also legal in Malaysia under the Racing (Totalizator Board) Act of 1961. The country has a rich horse-racing history, with racecourses dating back to the 1800s. Placing and accepting wagers on horse races is lawful only if operators hold the necessary permits. The Totalizator Board oversees the racing industry in Malaysia. Conducting research on equine sports and improving local turf clubs are also among its responsibilities.
Religious Laws Applying to Malays
A substantial percentage of Malaysia’s population is Muslim, and these citizens must adhere to the principles of Sharia law. The country recognizes Sharia courts that coexist with secular ones. Sharia is a set of moral codes derived from Islam and applies to all Malays.
Residents who belong to other ethnic groups (e.g., Indian and Chinese Malaysians) are classified as non-Malays. They do not have to comply with Sharia principles because civil gambling laws apply to them. The Sharia law prohibits gambling (maysir), decrying it as immoral and harmful (which it can be in some cases).
Sharia forbids participation in such activities because they allow individuals to accumulate wealth by chance rather than through productive work. Islamic texts like the Quran describe gambling as a serious sin, denouncing chance-based games as abhorrent creations of Satan.
Muslim Malays who gamble or possess money obtained from gambling are liable to punishment under the Sharia court system. Malaysian states have the authority to enforce Sharia law under Part 9 of the country’s Federal Constitution. The secular courts cannot interfere with matters within the jurisdiction of the religious courts, and vice versa.
As you probably know, gambling businesses usually donate a portion of their proceeds to charities and social causes such as education, scholarships, and infrastructure improvements. However, Muslim charities in Malaysia will never receive donations from gambling operators because they consider such money unclean.
Social Responsibility and Problem Gambling
Licensed betting operators in Malaysia must adhere to various social responsibility policies that align with local gambling laws. They must not allow underage individuals onto the betting premises. Locals may legally engage in gambling, provided they meet the minimum age requirement, which is 21 years old.
Restrictions on Gambling Premises Access
Responsible Gambling
Gambling Advertising
Problem Gambling
Restrictions on Gambling Premises Access
The operators must also restrict access for Malaysian Muslims, who cannot legally enter and play at casinos. That said, Malaysia has only one legal casino, namely Resorts World Genting. The luxurious resort is perched on a solitary hill 6,000 ft. above sea level to avoid scrutiny from the Muslim population.
Responsible Gambling
Lawful betting businesses must adopt a proactive approach toward addiction by promoting responsible gambling and offering assistance to patrons who need it. Resorts World Genting, for example, provides a questionnaire that helps customers determine whether they are at risk of developing gambling-related problems.
Problem Gambling
Research on problem gambling in Malaysia remains limited. In 2013, Monash University Malaysia and the Malaysian Health Association surveyed the prevalence of problematic gambling behaviors in the country’s most populous state, Selangor. The study found that roughly 4.4% of Selangor’s residents experienced problem gambling, while around 10.2% were at moderate risk of becoming problem gamblers.
Another study examined the prevalence of gambling among local adolescents in 2014. It involved 2,265 Malaysian minors and showed that approximately 30% had engaged in gambling during the previous year. Unfortunately, the country lacks properly structured state centers for problem gambling treatment at the moment. Malays who struggle with gambling addiction can turn to several non-governmental centers for rehabilitation.
Conclusion
The future of the gambling industry in Malaysia remains uncertain amid ongoing debates about whether the country should liberalize its gambling market. Unfortunately, this is not an easy topic to discuss. Much of the controversy stems from Malaysia’s dual legislative system, in which religious and secular courts coexist. The main question is whether Malaysian legislation should adopt a religious or a secular standpoint.
The absence of a regulatory framework for online gambling does little to stop locals from using the services of offshore casinos and sportsbooks, and they can do so without fear of prosecution. The government primarily targets illegal operators rather than individual gamblers. Perhaps the legislature will recognize the necessity of introducing proper online regulations in the future, especially considering the massive scale of illegal activities related to remote gambling.
Restrictions on Gambling Premises Access
The operators must also restrict access for Malaysian Muslims, who cannot legally enter and play at casinos. That said, Malaysia has only one legal casino, namely Resorts World Genting. The luxurious resort is perched on a solitary hill 6,000 ft. above sea level to avoid scrutiny from the Muslim population.