Comparative Business Law In Asia Essay


Discuss about the comparative business law in asia.


Research Question

To accomplish the research objectives, the following research objectives will be accomplished:

  1. How many times constitution has been changed in Malaysia and Indonesia?
  2. What are the impacts of constitutional changes in Malaysia and Indonesia?
  3. How does the constitution influence the political system in Malaysia and Indonesia?

Research Methodology

In this essay, the researcher discussed the various methods, procedures, tools to complete this research systematically, and in right ways. Many research philosophies, methods, policies, purposes, research designs, data collection methods, sampling and data analysis procedures are explained and justified to make sure the validity and reliability of results. In this, research methods are justified based on research subject and objects, which is important in achieving effective outcomes and results (Paul, 2017).

Literature review

This research study is related to the literature review, which is achieved to discover the research matter with applying various theories. The researcher empowers to contain the analysis of existing knowledge related to the research subject, and decide that at what extent it has been discovered until the date. For this, books, journals, and articles are studied, which also help in evolving the conceptual understanding about the research matter. It is also effective for the researcher to recognise the knowledge gap, as well as advance the foundation for accepting primary research approaches (Frankenberg, 2018).


The constitution is considered as document of destiny of nation and national charter. It explains the significance of the supreme law of the land. The federal constitution of Malaysia is called as supreme law in Malaysia. The federal constitution of Malaysia actually came into effect after the constitution of federation of Malaya. In present, the constitution of federation of Malaya is base of the federal constitution of Malaysia. The development of Malaya nationalism had contributed different concepts on the shape of Malayan nation, which may shape the government that is not same as western country model. The constitution in Malaysian came into effect on 27 August 1957 but freedom was attained on 31 August 1957.

The Indonesian constitution is foundation of the administration of Indonesia. Indonesian constitution was written in 1945, when Indonesia was developing from the Japanese control at the end of World War II. The 1945 constitution continued in force until it was substituted by the constitution on 27 November 1949. In turn, it was substituted by the constitution on 17 August 1950. Amending the constitution is the procedure of altering the fundamental law or supreme law of country. Many alterations have been made in the constitution of Malaysia and Indonesia.

In this essay, the constitutional amendments and impacts of constitutional amendments are discussed and examined.

Constitutional amendments in Malaysia-

Like a lawfully binding contract or agreement, any amendment adopts major importance and hence, should not be easily done. The political circumstances, economic circumstances and social circumstances have formed the requirement to amend the original contract. Some are considered for the justifiable reasons and some are more debatable. For example, when Sabah, Sarawak, and Singapore joined Malay to establish Malaysia in 1963, then the Malaysia Act was passed to alter the constitution to deliver for name change and addition of three new states. The federal constitution of Malaysia has been changed in 1957. Up to 1957 there have been 51 amendments Acts (Persson & Guido, 2014).

The constitutional amendments included many clauses. If amendments are used to decide the scope of revision of constitution, there have approximate 700 changes since constitution became effective. Some basic constitutional amendments to the constitution of Malaysia has led to a truncation of safeguards, which had reflected, by Reid Commission as vibrant for the development of practical self-governing nation. The provisions related to the amendments of constitution come under Article 159. The Reid Commission outlined it in a way which amendment will not be tough to the scope of frustrating requirement for the amendment, but at the similar point, not easy that it will finish weakening constitutional safeguard. The constitution may change by the amendment act supported by two third of members of parliament (Persson & Guido, 2006). There have been many amendments made in the constitution of Malaysia. One of the significant amendment is discussed as below.

Constitutional amendments in respect of human rights protection-

The human right protection is one of major amendment in the constitution of Malaysia. The constitution secured fundamental rights involving freedom of person, equality for all citizen before the law, right of freedom of movement, right of freedom of speech, right of freedom of expression of view and freedom of worship or freedom of religion. Not these all rights give surety but they are matter not only to express restrictions within the Malaysian constitution. They are matter of the ordinary law. The human rights that are not limited are those against oppression and compulsory labour, against reflective criminal laws and frequent trials and safeguards of property (Maddison, 2007).

The amended federal constitution in Malaysia secures the citizens of the Malaysia from misuse of rights and powers by those who administrate it. The rights of human cannot ignore. The constitution of Malaysia gives the guarantee and secures the different major rights and authorities of the citizens of Malaysia. These human rights can found in Article 5 to Article 13 of the constitution of Malaysia. The constitution specifies that all the citizens are equal. They have equal rights. Every person is entitled for the similar security. As per the amended provisions of Malaysian constitution all person are free to speak. They are free to fight for their rights (Knutsen, 2009).

Constitutional amendments in Indonesia

MPR or people consultative assembly or carrier of the independence of the people altered the Indonesian Constitution 1945. The amendments were not without disagreement. Many scientist, ex-military generals and the political leaders, opposed the amendments. Many scientist, ex-military generals and the political leaders demanded the cancellation of amendments and MPR re-enact the Constitution 1945. However, the arguments were given that the Indonesian constitution had theoretical weakness. Majority of MRP contended on the alteration of constitution in relation to make it self-governing, contemporary, and broad to every new challenge (Sachs, 2015).

The most significant alterations were restricting the heads of Indonesia to the two terms, forming a Regional Representative Council makes the elected People’s Consultative Assembly, abolishing the semi presidential system of government, authorising the presidential system of the government and direct election of the president (Schjolset, 2008). The amendments in the Indonesian constitution were made in the four levels at sessions of the People’s Consultative Assembly in 1999, in 2000, in 2001 and in 2002. There is an original fundamental agreement for conducting the amendment leads to the significances that official text of constitution of 1945 comprises of five parts (Milesi, 2003).

Human rights in constitutional amendments in Indonesia-

Indonesia has many alterations to the constitution, which were affected by political environment. There were various elements, which led to constitutional amendments. One facet of Indonesian constitutional amendments is the publication of provisions on the protection of human rights. The requirements related to human rights is more comprehensive compared to other constitutional amendments. For the second time, the facts of human rights in Indonesian constitution arrived as whole in second amendment to the 1945 constitution. In the second amendment, the MPR comprised practically the whole range of human rights as specified in the international law, civil rights and criminal rights over the fact of social rights, economic rights, and educational rights. The government of Indonesia has duty to secure, fulfil, and promote the human rights in the Indonesia. The Indonesian constitution specifies that the application of human rights according with principles of self-governing legal state and protracted the provisions within the secondary law. As per article 28I, paragraph (4) of the second amendment of Indonesian constitution clearly specifies that security, advancement, execution, and completion of human rights is the accountability of the state, mostly government (Jimly, 2009).

Chapter XA of the Indonesian constitution covers 10 Articles covering from 28A to 28J. It is not likely to state that Indonesian constitution has only ten articles. The Article 28A states that right to life should be secured. It specifies that every citizen have right to live and to protect his or her life. Article 28B of Indonesian constitution emphasises on the significance of right to issues through family and marriage. It also legalises for children’s rights. The Article 28C of Indonesian constitution states the rights related to self-growth, training, and education. Further Article 28D paragraph (1) specifies the rights to the lawful certainty of identical and reasonable treatment. The Article 28E clearly specifies that every citizen has right to worship as per his or her religion. Every person has right to decide the option of education, training and employment. Article 28F states the right to communication and Article 28G related to the protection of own and family. Furthermore, Article 28H of Indonesian constitution specifies that everyone have right to life, not to be tortured (Knutsen, 2007).

How the Comparative changes of Indonesia and Malaysia are interrelated

Indonesia and Malaysia are two nearest nations that share similarities in many facets. Indonesia and Malaysia have similar features characters. They have common structures in relation to history, culture, and belief. The Indonesia and Malaysia both are separate and self-governing states but they have some similarities. The national language of Indonesia and Malaysia are closely related and mutually imperceptible. The authoritarian rule of Indonesia is attributed to incisive personalize guidance, muted best challenges and control over the common viewers. On the other hand, semi-independent government or administration of Malaysia in some ways bordered by the outcomes in Indonesia (Greene, 2013).

There are some similarities between Indonesia and Malaysia in respect of the reform of practises in their constitution. Firstly, Malaysia and Indonesia both the nations have some standards to reform the practices in the constitution. The practices in the constitution in Indonesia mainly is originated from the Desa, while Malaysia refers to the legal custom or adat of Negeri Sembilan, which is called elective monarch tradition (Noor, 2011).

Secondly, Malaysia and Indonesia both the nations have same basis of self-governing customs, which is named as Adat Perpatih. It originated from Minangkabau. There are many self-governing customs that are experienced in the Desa in Indonesia. For example, the election of Lurah in the Javanese traditional village. They share same custom of democracy in the Minangkabau. The Adat Perpatith, musyawarah, mufakat are not directly pointed. The originators of Minangkabau, Mohammad Hatta and Muhammad Yamin play key role in the reconstruction of the Adat Perpatih in the Indonesian constitution. Third similarity is that Malaysia and Indonesia both the nations have same methods or patterns to recreate the independent custom depended on a comparative specific model. Both the nations focus on comparative fair features of the self-governing customs, which can be accepted in era of modern nation state (Maddison, 2006). The constitutional amendments in Indonesia is not completely dependable to settle with the principle of universality of human rights. There are some chapters in article of Indonesian constitution that involve ethics that have limitations on the rights of non-degerogable rights. The amended Malaysian constitution also focus on safeguard of human rights.

Despite of the similarities between Indonesia and Malaysia, there are some variances in reform of practices in the Malaysia and Indonesia. Firstly, the originators in Indonesia did not accept the monarchy system. They accepted republic as the alteration of desa in respect of modern country-state. On the other hand, Malaysia reserves a voting monarch as a reformation of self-governing practices in the legal monarchy. Secondly, after the Indonesian constitutional amendments at the four stages, the Indonesia has reject the self-governing practices as the foundation of constitutional structure. These amendments identify the traditional ordinary law or adat at common framework, specifically in old rural areas such as desa, banjar and nagari. It means Indonesia accepted the western democracy and rejected the democratic customs of desa. On the contrary, Malaysia had reserved the voting system in the legal monarchy system (Saleem, 2005).

Effect of constitutional framework in Malaysia and Indonesia-

Within 20 years of federal constitution in Malaysia, many amendments were made by the parliament. These amendments provided the original constitution unidentified resulting in researchers defining the original as the Merdeka constitution to define it different way from the previous version. The whole effect of these constitutional amendments were to support the administrative and give significant benefits for majorities, to the disadvantage of minorities whose self-governing space has minimised significantly. The whole alterations were not innovatory in the effect because the federal constitution was never substituted. However, the amendments were adequately extreme to change the fundamental framework. The conclusion of these extensive amendments is that the two third constitutional never functioned as a protection against hurried and harsh thought out alterations (Fesnic, 2006).

The Indonesian Constitution of 1945 is considered as shortest constitution. The Indonesian constitution is shorter than the United States constitution. The United States constitution comprises 4608 words. On the other hand, the Indonesian Constitution of 1945 comprised the 1393 words before the constitutional amendments. However, after constitutional amendments from 1999 to 2002, the four amendments increased the words to 4559 words. The Indonesian Constitution of 1945 contained the 71 ruling articles. After the implementation of fourth amendments in year 2002, the ruling articles increased to 199 ruling articles of the new articles (Cheibub & Fernando, 2012).

The four staged amendment procedure meant that Indonesia might implement common objectives for stability and modification at the same point. There were many shortcoming with this concept involving the possible to lead to difficulties of explanation and application. These four amendments were made by maximizing the motion of the wake of common disaster without any thoughtful research or the public awareness within the active constitutional beliefs of the Indonesia. These practical amendments were so important in nature that it may good to create them as a solid document to be rewrite in a combined text of the Indonesian Constitution of 1945 (Dahl, 2018).

How does the constitution influence economic policy?

In the opinion of communication between politics and the economics, the proper guidelines of the constitution affect the political decisions over the economic policies, given sharing of preferences over economic results in the population. The main objective is to acquire the knowledge about influences of these proper guidelines over the some special economic policies. Many political scientists consider the question of how constitutional rules and regulations affect the economic policy (Cheibub, 2007).

The constitutional engineering is quite tough but citizens have been presented with the duty of scheming or redesigning the constitution. The political organisations are to influence what economic policies governments monitor, but also economic organisations. For the economic development, the economic strategies and economic organisations both are important. The political organisations are significant for whole growth. However, there is no agreement on what special kinds of proper political organisations that advances the development rate. There are no strong variation in the economic development between the parliamentary and presidential democracies. The proportional representation voting guidelines generate the significantly higher economic growth rates in the comparison of plural majoritarian rules (Bird, 2015).

There is significantly organisational differences within the classes of parliamentary and presidential democracies. As per the parliamentary system, the supervisory authority is liable to an elective body thus creating the only locus of authority at the general level. On the other hand, the presidential system is called a system in which the power and right of making the policy is separated between the two distinct elected bodies. These two elected bodies are the legislature and the president. The third class is mixed system in which government can be removed by the assembly or by the elected president (Gerring, Strom & Carola, 2009).

There are some strong reasons for which parliamentary advances the governance and the financial consequences. It involve the stronger political parties, tough principal-agent relationships within the different arms of the bureaucracy, electoral responsibility at state level, the ability to form simple policy, an organised political scope and the key guidance. The benefit of parliamentary is to decrease the problem of direction at the government level. As per the presidential system, the voters can study the party membership of candidates along with different personal features and matters specific positions. The party discipline is supported by the parliamentary (Benhabib, 2005).

In addition, of increasing the economic development, parliamentary is connected with good bureaucratic quality, good telecommunications services, low import duty rates, higher rate of openness to the trade and profession, healthy and positive investment atmospheres, the lesser infant mortality and greater life expectancy. There are partial evidences exist for the better effect from parliamentary on the regulation of corruption and the rules and regulations. There are no healthy effect on the corruption from the authority when it includes all the democracies (Roberto, 2013).

The presidential system has no good effect over the economic organisational framework like bureaucratic quality and the property rights safety. There is negative effects reflect from the presidentialism on the production development in respect of labour and total factor productivity. The political economic procedure highlights the role of political responsibility for producing good policies and the consequences. In case of high degree of responsibility, voters are capable to vote out of office, those Legislators that achieve function poorly (Andrew, 2012).


As per the above discussion, it is cleared that in Malaysia, the administration plays a significant role in imposing law without abuse law. Everyone has the same right to do what he or she want to do without violating the law specified in the federal constitution. Despite of the fact of different democratic procedures in other nations, the constitution of Indonesia is slow, irregular and the uncertain procedure controlled to lead the country to constitution that is more independent and contribute substantially to the transition of Indonesia from overt fascism. It has been concluded that the constitution affects the economic and political growth of every nation. The solid focus has been made on the economic effects of the organisations in the political science and the finances. The effects of the constitution on the economic development depended on a higher sample of data than any previous study. There have been no effects on the economic development by the presidential and parliamentary democracies. The electoral system appear to matter in the systematic way for economic development.


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