Hotel raid: Authorities must adhere to due process

 

 The Small and Medium Enterprises Association of Malaysia (Samenta) expresses its concern regarding the local authorities' recent integrated operation on a hotel in Malacca following social media allegations.

While Samenta respects the role of state religious authorities and local councils in upholding local enactments, we are deeply concerned by the immediate seizure of the hotel’s business licence and the order for its closure.

This is particularly when the authorities themselves confirmed that no breaches of the Syariah Criminal Offences (State of Malacca) Enactment 1991 were found during the inspection of the hotel.

The decision to seize a business licence and force a closure based on allegations is part of a disturbing trend of “enforcement first, justify later”.

We must not allow “trial by social media” to dictate enforcement actions that can cause irreparable reputational and financial damage to businesses.

With the government’s ambitious target of 47 million visitors for Visit Malaysia Year 2026, the hospitality and SME sectors are expected to be the primary engines of growth. However, this growth is predicated on business certainty and the rule of law.

When administrative power is used to penalise businesses based on sentiment rather than established law, it creates an environment of unpredictability that drives away both local and foreign investors and visitors.

Area of concerns

Samenta wishes to highlight four key areas of concern:

• Economic impact: Arbitrary closures undermine Malaysia’s reputation as a stable, business-friendly destination. Investors require the assurance that their investments are protected by clear regulations.

• Due process: The right to be heard is a fundamental principle. While we note the owner has been summoned for an explanation, the closure order and licence seizure should follow an investigation, not precede it, especially when no immediate criminal breach was established during the raid.

• Jurisdictional clarity: We urge the authorities to ensure that enforcement actions remain within the scope of the law. Hotels are regulated by local bylaws and federal tourism guidelines. Using administrative powers to penalise a business without a clear violation of the law sets a dangerous precedent.

• Brand risk for VMY 2026: As a Unesco World Heritage site, Malacca is a cornerstone of Malaysia’s tourism brand. Reports of moral policing targeting the hospitality sector travel fast globally.

  International tour operators and high-value travellers seek destinations that are welcoming, safe, and governed by the rule of law, especially when competition for the regional tourism dollar is at its peak.

Act with proportionality, fairness

We call upon the local authorities to return the business licence immediately and allow the hotel to resume operations while the investigation continues.

Enforcement agencies must act with proportionality and fairness to protect both the social fabric and the economic livelihood of our SMEs.

We remind business owners, especially SMEs, to remain vigilant of cultural sensitivities. Operating with high social awareness is essential to avoid unnecessary friction that could impact long-term sustainability.

Samenta remains committed to working with all levels of government to ensure that Malaysia remains a competitive and fair environment for all businesses to thrive. - Mkini

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WILLIAM NG is Samenta president.

The views expressed here are those of the author/contributor and do not necessarily represent the views of MMKtT.