The Malaysia Agreement 1963 (MA63) and the Autonomy of Sabah and Sarawak

A nation formed in 1963 out of four different territories is still arguing, more than six decades later, over what was actually agreed on the day it was born. The document behind that debate is the Malaysia Agreement 1963 — commonly abbreviated as MA63.

This article reports descriptively on what MA63 sets out, what was promised to Sabah and Sarawak, how the Constitution protects their position, and the ongoing process of restoration and implementation. It presents the facts and the various positions without taking sides.

How was Malaysia formed in 1963?

Before any agreement was signed, two bodies laid the groundwork. The Cobbold Commission, established in 1962 and led by former Bank of England Governor Lord Cobbold, was dispatched to assess the views of the people of North Borneo and Sarawak, and reported its findings on 1 August 1962. Following this, an Inter-Governmental Committee (IGC) chaired by Lord Lansdowne with Tun Abdul Razak Hussein as deputy drew up provisions to protect the special interests of the two territories.

The result was the Malaysia Agreement, signed in London on 9 July 1963 by five parties — the United Kingdom, the Federation of Malaya, North Borneo, Sarawak and Singapore — and containing 11 articles. It was implemented through the Malaysia Act 1963, and the Federation of Malaysia was officially formed on 16 September 1963, now celebrated as Malaysia Day.

Event	Date
Cobbold Commission reports its findings	1 August 1962
Malaysia Agreement signed in London	9 July 1963
Malaysia established (Malaysia Day)	16 September 1963
Singapore leaves Malaysia	1965

Singapore later left Malaysia in 1965, leaving the federation composed of the Peninsula, Sabah and Sarawak.

What was promised in the 20 Points and 18 Points?

During the negotiations, leaders of the two territories submitted lists of their conditions for joining. Sabah submitted a 20-Point memorandum, and Sarawak an 18-Point memorandum. Both outlined the safeguards they demanded in areas such as:

• religion — the position of Islam as the religion of the Federation without affecting freedom of religion in the states concerned;
• language — the use of English and local languages;
• immigration — state control over the entry of persons;
• land and forests — remaining a state power; and
• native rights (Borneo bumiputera) and the state civil service.

According to the historical record of the formation of Malaysia, some of these points were incorporated into the Federal Constitution as binding safeguards, while others were accepted only verbally and did not acquire legal status. It is this distinction — between what was enshrined and what was understood — that is the source of much of today’s debate.

How does the Constitution protect the position of Sabah and Sarawak?

Several provisions of the Federal Constitution were specially designed for the two states. Among the most fundamental is Article 161E, which requires the consent of the Yang di-Pertua Negeri of Sabah or Sarawak before the Constitution can be amended in a way that touches on certain matters concerning that state. The matters protected under Article 161E(2) include, among others:

• the citizenship rights of persons born before Malaysia Day based on their connection with the state concerned;
• the constitution and jurisdiction of the High Court in Sabah and Sarawak and the appointment of its judges;
• state legislative powers and state executive authority;
• religion, the use of language, and special treatment of natives; and
• the provision for the state’s quota of seats in the Dewan Rakyat being not less than the quota on Malaysia Day.

Sabah and Sarawak also have additional legislative lists (List IIA and List IIIA under Article 95B) that give them jurisdiction not held by the Peninsular states — discussed in the article on the division of powers between the Federation and the States.

Why does the question of “partner” status arise?

In its original arrangement, Article 1(2) of the Constitution distinguished the States of Malaya from the Borneo States. According to ConstitutionNet’s analysis, a 1976 amendment restructured the clause to list all 13 states alphabetically in a single category — a change that some quarters in Borneo regarded as downgrading Sabah and Sarawak from “partners” to merely “one of the states”.

The issue returned to Parliament at the end of 2021. On 14 December 2021, the Dewan Rakyat passed the Constitution (Amendment) Bill 2021, which amended Article 1(2) again to once more list “the States of Malaya” and “the Borneo States, namely Sabah and Sarawak” as two separate categories. The third reading was supported by 199 members (200 at the second reading) with none opposing, exceeding the two-thirds threshold required under Article 159. The amendment was then gazetted as Act A1642 (Constitution (Amendment) Act 2022), which also added a definition of “Malaysia Day” in Article 160 and amended Article 161A.

The government characterised this amendment as a restoration of the status of Sabah and Sarawak in line with the spirit of MA63. Some quarters in Borneo, meanwhile, characterised it as a first step that must be followed by the full implementation of the other MA63 matters, not the end of the process.

What claims are still under negotiation?

The implementation of MA63 is now coordinated by the MA63 Implementation Action Council (MTPMA63) chaired by the Prime Minister, with a Technical Committee led by the Deputy Prime Minister. As of reporting, a total of 13 of the 29 claim matters have reportedly been resolved and 16 more remain at various stages of negotiation; an online dashboard is also planned to track implementation progress.

Among the matters still open:

• Sabah’s 40 per cent revenue. Articles 112C and 112D and the Tenth Schedule provide for special grants and periodic reviews for Sabah and Sarawak. On 17 October 2025, the Kota Kinabalu High Court ordered the Federal Government and Sabah to carry out a review of Sabah’s 40 per cent revenue entitlement for the period 1974–2021, with the review to be completed within 90 days and agreement reached within 180 days. On 6 April 2026, the Court of Appeal granted a stay application by the Federal Government pending appeal.
• Interim special grant. The Prime Minister announced that the interim special grant for Sabah and Sarawak would be increased to RM600 million each (from RM300 million), effective from 2025; this grant is reviewed every five years.
• Parliamentary seats. On 8 September 2022, the Special Council on MA63 (MKMA63) endorsed a proposal to restore 35 per cent of the 222 Dewan Rakyat seats (about 78 seats) for East Malaysia, compared with 56 seats (25 per cent) at the time (Sabah 25, Sarawak 31). Its implementation requires a constitutional amendment.

The positions of the various parties differ from matter to matter. The Federal Government generally frames the process as a phased implementation with listable achievements, while some leaders and civil society bodies in Sabah and Sarawak insist that many of the original safeguards have been eroded and demand full and immediate implementation. Some claims are now also being tested in the courts.

What comes next

To understand how law-making power is divided between the Federation and the states — including the additional lists for Sabah and Sarawak — see the division of powers between the Federation and the States. For the place of MA63 within the overall constitutional documents, see the Federal Constitution and constitutional amendments. For the body that holds the federal legislative power that passed the related amendments, see Parliament.

---

This article is classified as sensitive (constitutional) under NegaraKu.md’s editorial policy because its subject is the founding agreement of the federation and the constitutional position of Sabah and Sarawak. It is written descriptively and neutrally — reporting the facts and the various positions as recorded, without taking sides or offering commentary — and is held as an interim draft pending human review before publication.