Study on need for lemon law to conclude soon, says minister

PARLIAMENT | Domestic Trade and Cost of Living Minister Armizan Mohd Ali said the study on the need for a lemon law in Malaysia will conclude soon.

The study on the law, which protects consumers from purchasing defective vehicles, began in June and will be completed this month, he told the Dewan Rakyat today.

“We will soon make a policy decision at the ministry level as to whether we will improve existing laws or if there is a need to introduce a new act,” he said in his speech addressing Budget 2025.

After that, the matter will be referred to the cabinet, he added.

In June, he said a group of law experts had been appointed to prepare a report on best practices employed by other countries and to hold engagement sessions.

A lemon law provides consumers with a remedy so they can obtain compensation for products that fail to meet standards.

At the moment, the ministry has implemented interim strategies to protect consumers, Armizan said.

He said it first established a negotiation task force for motor vehicle complaints at the ministry.

“Through this team, we will be the component that meets between buyers, producers, and distributors, for them to quickly solve any issues that arise,” he said.

Between June 1 and Sept 31, the task force received 16 complaints that it has investigated, Armizan added.

Empowering tribunal

The second strategy was to empower the Consumer Claims Tribunal through strategic cooperation with Bank Negara Malaysia (BNM), he said.

He explained that the issue begins with the Hire-Purchase Act 1967, which recognises the bank as the owner of a vehicle during the payment of a loan.

This has led to problems with the tribunal as those paying off loans have found it difficult to obtain consent letters from their banks, he noted.

He said BNM has already issued instructions to banks to establish standard operating procedures (SOPs) to ease this process.

BNM has also requested that banks set up special units to process requests for this consent letter, he said.

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