Langkawi Gazette

Mark:2 August 2010 /Source Bernama

State Government questioned for allowing Foreigners
to buy Malay Reserve Land

(And below a list of common Alibaba Tactics, MR)

ALOR SETAR, Aug 2 (Bernama) -- The Kedah state government was today taken to task for allowing foreigners to buy and build houses on Malay reserve land in Langkawi.

Mohd Rawi Abdul Hamid (BN-Air Hangat) said according to the "Malaysia My 2nd Home" scheme, foreigners were only allowed to buy completed houses and not land.

"I want to know whether the state government is aware that there are 50 foreigners who have bought land in Langkawi and built bungalow houses on them," said Mohd Rawi at the Kedah state legislative meeting on Monday.

He revealed that they (foreigners) had built bungalows on such land and turned them into Homestays for business purposes and that such bungalows existed in Ulu Melaka, Kedawang and Air Hangat.

Kedah Menteri Besar Datuk Seri Azizan Abdul Razak (Pas-Sungai Limau) said the state government would ensure that foreigners would not use names of Malays to purchase land at the leading holiday and tourist destination.

"We are aware that many foreigners are living in Langkawi and we are making sure such land is not bought by them. However, if they use the "Ali-Baba" tactics, it will be difficult to trace or overcome such problems," said Azizan.

Azizan said the Kedah state government had recently rejected a request from foreigners to buy an Island around Langkawi."

Source: BERNAMA

Here is a list of the commonly used Alibaba tactics:

- you buy the land through a 3rd party who is Malay
- you form a company with more than 50% Malay but keep the control of the company
  (e.g. with undated, presigned letters of resignation of the other co directors)
- you do not care about the landownership, but just lease the land for a long time
- you do not care about the landownership, but make an agreement with the owner, that you build your house on his land and can live there for free for e.g. 30 years. After this time the house belongs to the owner of the land and you have the right to stay but have to pay a monthly rent.
- same as above, but the owner contributes to the cost of the house and you make a very long contract and pay rent from the beginning.

This list makes it clear, that any control of the Government to keep foreigners away from Malay Reserve Land will be very difficult. 

The government would need to take away the right of the Malays to lease their land to foreigners or to rent a house on their land to a foreigner. Even if legally possible (which is questionable) this would not be very popular and is unlikely to happen IMO.