Authored By: ROSHNASWARUBINY A/P PREMKUMAR
UNIVERSITY KEBANGSAAN MALAYSIA
INTRODUCTION
The COVID-19 pandemic, especially during Malaysia’s 2020 Movement Control Order (MCO), marked a key shift toward digital transformation, particularly in e-commerce. With strict lockdowns closing non-essential businesses, schools, and places of worship, Malaysians relied heavily on online platforms for their daily needs. As only one person per household was allowed out for essentials, e-commerce was deemed an essential service—underlining its vital role during the crisis1. The surge in online shopping during the pandemic sparked major growth in Malaysia’s e-commerce scene, changing how people buy and sell. Statista predicts the number of e-commerce users in Malaysia will grow by around 8.1 million between 2024 and 2029—a 75.91% increase—making it one of Southeast Asia’s rising digital markets. This growth is fueled by better internet access, higher digital literacy, and the convenience of shopping online.
Popular platforms like Shopee, Lazada, Mudah, Carousell, and Zalora have become go-to choices for Malaysians, constantly upgrading with AI and big data to improve user experience and stay ahead. While this digital boom boosts jobs and innovation, it also raises legal concerns, especially around consumer protection. With more transactions happening online, issues like fraud, false advertising, and unfair practices are on the rise. This article looks into the legal side of Malaysia’s e-commerce growth, focusing on the protections in place to keep digital shopping safe and fair2.
As Malaysia moves quickly into the digital economy, protecting online shoppers is more important than ever. Buying things online isn’t the same as shopping in person—it comes with its own set of risks. Many people face issues like unclear refund or cancellation policies, misleading product descriptions, and confusing terms and conditions. On top of that, there’s the threat of online scams, data leaks, unsafe payment methods, and misuse of personal information.
What makes it harder is that many online sellers are based overseas, which means Malaysian laws might not apply to them—making it tough for consumers to get justice when things go wrong. If there aren’t strong laws and clear rules in place, people will lose trust in online shopping. And without that trust, Malaysia’s e-commerce growth could slow down. So, creating a safe and reliable online space isn’t just good for shoppers—it’s key to building a strong digital future for the country3.
This article looks into the legal protections that are currently in place for Malaysian consumers when they shop online. It also points out the ongoing challenges that make it hard to fully enforce these protections. With online shopping becoming more common, it’s important to ask: are our current laws good enough? And if not, what can be improved to make sure people feel safe and confident when buying things online?
LEGAL FRAMEWORK FOR CONSUMER PROTECTION IN MALAYSIA
The Consumer Protection Act 1999 (CPA)4is Malaysia’s main law that protects the rights of consumers. It was created to shield people from things like false advertising, unfair business practices, and faulty products or services. Over the years, it has been updated to keep up with new issues—especially as more Malaysians shop online. The Act now covers online purchases too, and includes rules on things like misleading information, unsafe products, and unfair contract terms. It’s enforced by the Ministry of Domestic Trade and Cost of Living (MDT), which also handles complaints and works with the National Consumer Advisory Council to ensure consumer voices are heard5.
The CPA also covers online shopping in Malaysia, making sure people are protected when buying goods or services through websites and e-commerce platforms. It helps protect consumers from faulty products, misleading ads, and unfair treatment by sellers. Under the Act, businesses must make sure what they sell online is safe, works as promised, and is good quality. If something goes wrong—like receiving a damaged item or poor service—consumers have the right to ask for a refund or cancel the purchase. The CPA also puts a strong focus on online safety, requiring businesses to protect customer information and prevent fraud, helping to build trust in the growing world of e-commerce6.
The Electronic Commerce Act 2006 (ECA 2006)7 was introduced to support Malaysia’s digital economy by giving legal recognition to electronic contracts and communications. It ensures that agreements made online—through emails, web forms, or digital platforms—are legally valid and enforceable, just like traditional paper contracts. Sections 6 and 7 of the Act confirm that electronic documents can’t be rejected simply because they’re in digital form. The Act also allows offers, acceptances, and cancellations to be made electronically, making online transactions faster and more efficient. It supports the use of digital signatures to ensure authenticity and trust, working alongside the Digital Signature Act 19978. While the ECA doesn’t directly handle consumer protection, it provides the legal foundation needed for secure, reliable, and recognized e-commerce transactions in Malaysia, helping to build trust and align with international standards9.
The Personal Data Protection Act 2010 (PDPA)10is Malaysia’s main law for protecting people’s personal information, especially when it comes to online shopping and digital transactions. Managed by the Personal Data Protection Department under the Ministry of Communications and Multimedia, the PDPA ensures that businesses handle personal data—like names, addresses, and payment details—responsibly11. It sets out seven key principles that businesses must follow, including clearly telling users why their data is being collected, keeping it secure, making sure it’s accurate, not keeping it longer than necessary, and giving users the right to access or correct their data. It also controls how data is shared, especially across borders. For e-commerce companies, following the PDPA isn’t just a legal requirement—it’s also important for building consumer trust. Companies that fail to comply can face penalties, showing that data protection is taken seriously in Malaysia’s digital economy12.
The Sale of Goods Act 1957 (SOGA)13 helps protect online shoppers in Malaysia by making sure the same rules apply to goods sold online as they do in physical stores. One key part of the law—Section 15—says that if a product is sold by description, it must match exactly what was advertised. This is especially important in e-commerce, where buyers can’t see or touch the product and must rely solely on the description, photos, and details provided by the seller. If the item received doesn’t match what was promised—like being the wrong size, material, or quality—the buyer has the right to cancel the deal and ask for a refund or replacement. This legal protection is crucial for platforms like Shopee and Lazada, where accurate product listings are essential for fair and trustworthy online shopping14. Additionally, the importance of this legal protection is heightened in e-commerce, where consumer vulnerability is increased due to the inability to assess product quality firsthand and the complexity of digital contracts15. Therefore, SOGA remains essential in protecting online consumers and maintaining fair trade practices in Malaysia’s growing digital marketplace.
CONSUMER RIGHTS IN E-COMMERCE
In the world of online shopping, consumers have the right to clear and honest information before making a purchase. Sellers and platforms must provide accurate product descriptions, pricing, delivery details, and return policies. Laws like the Consumer Protection (Trade Descriptions) Act 2011 make it illegal for businesses to mislead shoppers with false claims or vague terms. Following ASEAN guidelines, these platforms are expected to present information in a simple, user-friendly way—not buried in confusing legal language. This transparency helps consumers make informed decisions and builds trust in the digital marketplace.
Shoppers also have the right to redress when things go wrong, such as receiving faulty items or services that don’t match what was promised. Under Malaysia’s Consumer Protection Act 1999 (CPA), buyers can ask for a refund, repair, or replacement. E-commerce platforms are encouraged to have clear complaint processes and participate in cross-border resolution efforts like the ASEAN ODR network. At the same time, protecting personal data is more important than ever. The Personal Data Protection Act (PDPA) requires businesses to handle personal information with care, get user consent, and protect against data breaches. Consumers should also be free from manipulative or unfair practices online. The Consumer Protection (Fair Trading) Regulations 2013 help prevent hidden charges and misleading layouts, urging platforms to design fair and transparent experiences for all users16.
CHALLENGES IN PROTECTING IN E-COMMERCE
Misleading advertising is a major issue in online shopping, with many e-commerce vendors using exaggerated product descriptions, doctored images, or fake testimonials to mislead consumers. On platforms like Shopee and Lazada, photos of products often don’t match what customers actually receive, leading to dissatisfaction. According to Shivani Sothirachagan, misleading ads and poor product descriptions are among the most common unfair practices in Malaysia. These tactics violate the Consumer Protection (Trade Descriptions) Act 2011, which aims to prevent false claims in trade and protect consumers’ rights17.
Counterfeit and substandard goods are also a growing concern on e-commerce platforms, where verifying product authenticity becomes harder as the number of third-party sellers increases. Many imitation products lack the necessary quality guarantees required by Malaysian law, and this issue extends beyond Malaysia, as seen in global studies like those from Tanzania. Anonymity of sellers and poor monitoring further hinder efforts to ensure product standards, compromising consumer safety and market integrity18.
Additionally, consumers often face a lack of transparency, particularly in pricing and transaction policies. Hidden fees and unclear return policies create confusion and frustration, especially for new or vulnerable shoppers. The problem is made worse by weak enforcement of consumer rights, as many sellers don’t comply with legal requirements for returns and warranties. Cybersecurity risks, such as phishing scams and unauthorized data collection, are also rising concerns, leaving consumers exposed to fraud and identity theft. Moreover, cross-border e-commerce complicates the issue, as Malaysian consumers struggle with jurisdictional challenges when dealing with international sellers, making it difficult to resolve disputes or seek redress for defective products19.
ENFORCEMENT OF CONSUMER PROTECTION LAWS IN E-COMMERCE
Enforcing consumer protection laws in Malaysia’s e-commerce space is a shared effort between the Malaysia Competition Commission (MyCC) and the Ministry of Domestic Trade and Consumer Affairs (KPDNHEP)20. MyCC, formed under the Competition Act 2010, focuses on keeping online markets fair by preventing practices like price-fixing or monopolies. One major example was in 2019 when MyCC took action against Grab for abusing its market position by stopping its drivers from promoting other services21. On the other hand, KPDNHEP handles consumer complaints and monitors online transactions to make sure sellers follow the Consumer Protection Act 1999.
The ministry’s role became especially important during the pandemic when online fraud spiked, with over 24,000 complaints and losses reaching RM21.7 million. To help consumers seek justice, several options are available: they can file a complaint through KPDNHEP’s online portal (e-Aduan), bring small claims to the Consumer Claims Tribunal (for cases under RM50,000), or report unfair competition directly to MyCC22. These efforts, paired with stronger enforcement and more public awareness, show Malaysia’s growing dedication to protecting consumers in the ever-evolving world of online shopping.
THE ROLE OF E-COMMERCE PLATFORMS IN CONSUMER PROTECTION
E-commerce platforms like Lazada and Shopee help protect consumers by enforcing seller rules, ensuring platform liability, and putting policies in place to safeguard buyers. Both platforms require sellers to follow local laws and take action against counterfeit products. For example, Shopee has a strict zero-tolerance policy for fake and harmful products and takes strong measures against those who violate the rules23. Similarly, Lazada encourages customers to report counterfeit listings and offers return options for such items, initiating investigations upon reports24.
Platform liability for third-party sellers is a complex issue. While many platforms see themselves as intermediaries, legal views differ. In some cases, courts have held online marketplaces responsible for defective products sold by third-party sellers, especially when the platform actively promotes or sells those goods. In other cases, platforms are not held liable if they were unaware of the specific infringing sellers or listings25. Lazada and Shopee have introduced LazMall and Shopee Mall to offer verified sellers and authentic products, along with better return policies and fraud detection tools to build buyer trust. However, counterfeit products still occasionally appear, showing that more work is needed to improve enforcement and strengthen consumer confidence.
RECENT TRENDS AND RECOMMENDATIONS
The COVID-19 pandemic transformed shopping habits in Malaysia, driving more people to e-commerce platforms as physical stores closed. This shift has led to a booming e-commerce market, expected to reach USD 16 billion by 2025, fueled by tech-savvy shoppers and mobile shopping growth26. However, this rapid growth has also exposed gaps in consumer protection, including issues with refund policies, misleading ads, and unsafe cross-border purchases. In response, the government is reviewing key laws like the Consumer Protection Act 1999 and Electronic Trade Transactions Regulations 2012 to keep up with the digital age and address concerns such as high platform commission rates and unregulated overseas sellers27.
To further protect consumers, Malaysia is focusing on digital literacy and consumer rights through initiatives like the National Consumer Policy 2.0 and the Consumerism Action Plan 203028. With around 40% of e-commerce transactions involving international sellers, Malaysia is also working with global organizations to harmonize cross-border e-com29. These efforts are aimed at creating a safer, fairer, and more transparent online shopping experience.
CONCLUSION
Consumer protection in e-commerce is crucial as Malaysia’s online market continues to grow. Legal frameworks like the Consumer Protection Act 1999 and Electronic Trade Transactions Regulations 2012 aim to safeguard consumers, but challenges such as misleading ads, counterfeit products, and cross-border disputes persist. Stakeholders, including the government, e-commerce platforms, and consumers, must continue to work together to address these issues. Ongoing updates to laws, better consumer education, and improved enforcement are essential to keep pace with the evolving digital marketplace.
As e-commerce grows, it’s important for consumers to stay informed about their rights and the protections available. By understanding these safeguards, shoppers can make safer, more confident choices, helping to build a fairer and more secure online environment.
Reference(S)
1 Benedict Leong, “COVID-19’s Impact on Malaysia’s eCommerce Market” (janio.asia/, April 14, 2020) <https://www.janio.asia/resources/articles/ecommerce-online-shopping-malaysia-covid-19> accessed April 13, 2025
2 Thirosha, “E-Commerce in Malaysia 2024: Trends and Phenomenal Growth” (InCorp Global Malaysia, October 3, 2024) <https://malaysia.incorp.asia/blogs/future-of-e-commerce-in-malaysia/>
3 Kaur, “Consumer Protection in E-Commerce in Malaysia: An Overview” [2003] UNEAC Asia Papers <https://citeseerx.ist.psu.edu/document?repid=rep1&type=pdf&doi=3b9cf624681e348820f8392c584cf07d4605b6f5 >
4 Consumer Protection Act 1999
5 “Country Malaysia ASEAN Consumer” <https://aseanconsumer.org/selectcountry=Malaysia>
6 “Navigating Malaysia’s e-Commerce Regulations: A Guide for NZ Businesses” (November 28, 2024) <https://www.dhl.com/discover/en-nz/e-commerce-advice/e-commerce-best-practice/malaysia-ecommerce-regulatio ns-nz-businesses#:~:text=The%20Consumer%20Protection%20Act%201999,harm%20caused%20by%20defective %20goods>
7 Electronic Commerce Act 2006
8 Digital Signature Act 1997
9 Ayub ZA and others, “Malaysian Electronic Commerce Act 2006 and EU Directives: Consumer Protection Perspectives,” vol Vol. 3 (2007)
10 Personal Data Protection Act 2010
11 “MyGOV – the Government of Malaysia’s Official Portal” <https://www.malaysia.gov.my/portal/content/654>12 “——” (November 28, 2024) <https://www.dhl.com/discover/en-nz/e-commerce-advice/e-commerce-best-practice/malaysia-ecommerce-regulatio ns-nz-businesses#:~:text=The%20Consumer%20Protection%20Act%201999,harm%20caused%20by%20defective %20goods>
13 Sale of Goods Act 1957
14 Abdullah Asuhaimi F 1 and others, “Sale by Description in Today’s Online Contracts: Issues and Challenges,” vol 27 (2021) <https://majcafe.com/wp-content/uploads/2022/11/Vol-27-S1-Paper-10.pdf>
15 Ong TC a and others, “E-Commerce Consumer Contracts for Sale of Goods: Privacy Perspective,” vols 8–8 (2019) <https://ww.ijicc.net/images/vol8iss6/8616_Chin_2019_E_R.pdf>
16 ASEAN Secretariat, ASEAN Guidelines on Consumer Protection in E-Commerce (ASEAN Secretariat 2022) <https://asean.org/wp-content/uploads/2023/03/ASEAN-Guidelines-on-Consumer-Impact-E-COMMERCE_V2-1.pd f>
17 Sothirachagan S and Digi Telecommunications, “Protecting Malaysian E-Commerce Consumers” (2020)18 Njau LM and The Law Brigade (Publishing) Group, “CHALLENGES OF CONSUMER PROTECTION IN E-COMMERCE IN TANZANIA,” vol 7 (2021) <https://www.thelawbrigade.com>
19 Ahmad V and Ghai DN, “CHALLENGES AND PROSPECTS OF E-COMMERCE- A REVIEW (2015-2022)” (2022) Vol.11 International Journal of Food and Nutritional Sciences 545 <https://www.ijfans.org/uploads/paper/72586391f4f87dd6a62e9b0084958e24.pdf>
20 “Case” (Malaysia Competition Commission (MyCC), September 30, 2024) <https://www.mycc.gov.my/case>
21 Kiss LN, “Comments before the Malaysia Competition Commission Regarding Assessment of Malaysia’s Digital Markets” (ITIF, April 11, 2025) <https://itif.org/publications/2025/04/11/comments-malaysia-competition-commission-assessment-malaysias-digital -markets/>
22 The Borneo Post, “KPDNHEP: 24,018 Complaints on Online Fraud, Electronic Scams during Pandemic” (Borneo Post Online, March 14, 2022) <https://www.theborneopost.com/2022/03/15/kpdnhep-24018-complaints-on-online-fraud-electronic-scams-during pandemic/>
23 TED CORDERO,GMA News and TED CORDERO, GMA News, “Shopee, Lazada Say Merchants Are Obliged to Comply with Regulations” GMA News Online (June 12, 2019) <https://www.gmanetwork.com/news/money/companies/697471/shopee-lazada-say-merchants-are-oblige d-to-comply-with-regulations/story
24 “PSA: How to Avoid Buying Fake Products on Lazada and Shopee – SoyaCincau” (SoyaCincau, November 10, 2020) <https://soyacincau.com/2020/11/10/psa-how-to-avoid-fake-products-on-lazada-and-shopee-online-sales
25 Fernan HGO, “Are Online Shopping Sites Liable for the Sale of Fake Products? – CFIP Law” (CFIP Law, December 11, 2020) <https://cfiplaw.com/2020/11/are-online-shopping-sites-liable-for-sale-of-fake-products>26 Loh Y, “What Is behind Malaysia’s E-Commerce Boom?” (LUXUO, February 26, 2025) <https://www.luxuo.com/business/what-is-behind-malaysias-e-commerce-boom.html>
27 Ping JCY and Yew B, “Review of Malaysia’s Electronic Commerce Law to Be Completed by March 2025” (Lexology, November 7, 2024) <https://www.lexology.com/library/detail.aspx?g=721d839f-3163-44c4-ab21-57c395c1a1e9>
28 “Read News National Consumer Policy 2.0 Launching in 3Q ASEAN Consumer” <https://www.aseanconsumer.org/read-news-national-consumer-policy-20-launching-in-3q>29 Sankhya, “E-Commerce in Malaysia – 2025 Trends and Insights | Locad” (Locad, January 24, 2025) <https://golocad.com/blog/e-commerce-in-malaysia-2025-trends>
