Wednesday, 5 November 2014


By: Selvaraja Somiah

This is a story about how some public listed companies from Peninsular Malaysia have gained ” ownership” of Sabah’s Native Title lands through seemingly legal but downright dishonest means via sublease.

This modus operandi, which started around the 1990s, has been so successful that now the talk of the town is that even China nationals are getting hold of Native Title lands by setting up firms and hiring natives as employees, who hold these assets in trust. The whole idea is to circumvent the law and reap millions from the land after adding value to it by planting oil palm or other crops.

In most cases, the public listed companies do not show any of these landed assets in their annual reports, which are hidden under profits and nominees. The nominees are often workers with little education so they dont know they being used. Many of these lands were acquired after the PBS administration and yet declared under a 90-years lease in many of the public listed companies annual report declarations. One such public listed company is IJM Plantations Berhad. The Securities Commission of the Malaysian Stock Exchange should investigate IJM Plantations Berhad to ascertain whether any deceitful practices have been committed in this regard.

The end result is that many SABAH’s NATIVES will lose their lands as these will be consolidated with others and made to appear that these public listed companies have a large land bank with sub leases of up to 90 years as in the case of IJM Plantation Berhad.

So how did major corporations, companies, foreigners and NON-NATIVES gain control of NATIVE TITLED lands that has now allowed them to gain profits ONLY for themselves whereas poor and mostly, uneducated Natives end up gaining virtually NOTHING?

Let me explain.

There are provisions that generally recognise the Sabah Native Title land rights in the Federal Constitution, the Sabah State Constitution and the Sabah Land Ordinance. Yet native communities are still left out and have become embittered and disappointed because there is inadequate care and concern about respecting the spirit of these laws. And infringements of their rights are continuing. Even the SUHAKAM panel has itself described these land grabs as “injustice that is unrestrained”.

It is understandable why with major corporations like IJM Plantations Berhad, foreigners and Non-natives are dealing in native lands. Firstly, land held under Native Title is free of rent for the first 6 years and thereafter only a nominal rent of 0.50 sen per acre is payable. No premium is payable for Native Titled lands. These together with the perpetual nature of the title (999 years) and exemption of stamp duty on transfers, charges and subleases are the generous terms accorded only to Native Lands .

Hence many public listed companies, foreigners and non-natives have influenced, instructed and used poor natives as tools to orchestrate a devious scheme to circumvent the relevant statutory prohibition against dealings, owning, transferring and charging of the land between native and non-natives and to regularise what is an otherwise illegal transaction. The entire dealings are fraudulent in the way they circumvent the law and abuse the protection afforded to Sabahan Native rights and native titles.

IJM Plantations Berhad is of the notion that these natives, as Registered owner for hundreds of acres are not privy to a “shred of paperwork”. In one particular case, a native Sabahan was employed by IJM Plantations as a driver with a salary of RM2000 a month but in records with the Inland Revenue he earns RM5000 and pays taxes, which he only found out when he went to collect BR1M which he was not eligible for.

So, who declared to the Inland Revenue on his behalf and paid his taxes? He and many other natives are not able to benefit from any legal advice nor will they ever be able to find and to put their names to the ownership of these native lands as they are entrenched in some remote place in the interior. This is a simple case of an abusive employer/employee relationship.

The suppression of documentation, creation of illegal documentation and consequently making of a false declaration is not the result of any innocent error but a vital element in the furtherance of a scam which forms the basis of the contention between these poor Natives and these major corporations, companies and non-natives.

IJM Plantations Berhad entered into a sublease agreement with poor natives (as registered owner) and carried out business through the “Sublease Agreements” whereby the terms and conditions of these Sublease Agreements, inter alia are that:

1) 4(h) Lessee ( being IJM Plantations Berhad) shall be entitled at all times and from time to time to create any charge, mortgage, or any other encumbrance on the said Lands or sell or attempt to sell, rent, or otherwise dispose of the said Lands during the subsistence of this Lease or any or all extensions thereof and The Memorandum of Sub-Lease contains the Power of Sale, Sub-Lease and other Powers of these major corporations, companies and non natives which is equivalent to Owners Rights over the Native Titled lands.

These agreements which were in fact Power of Attorney and thus contravened S17(1) and S64 of the Sabah Land Ordinance should be void, illegal and of no effect. To entrench further its hold on these Native Titles, IJM Plantations Berhad also executed Trust Deed Agreements, specifying clearly who had financed the entire sale and “threatening” these poor natives to toe the line. Some of the terms and conditions of the said Trust Deed Agreement, inter alia, are that:

a) The Trustees have entered into a Sales and Purchase Agreement at the demand of the Beneficiary ie IJM Plantations Berhad, in respect of the said Native Titled Lands on the terms and conditions contained in the said Agreement.

b) The consideration due to the S & P was provided, supplied and financed by IJM Plantations Berhad. (This itself is an illegal act as companies money was used and financed for an illegal act acquiring these NT lands)

c) All rights and interest accruing thereon in trust for IJM Plantations Berhad

d) Assign and transfer the said lands to such person or persons at such time or times and in such manner or otherwise deal with the same as IJM Plantations Berhad shall direct or appoint.

e) Any such assignment, transfer or dealings or if so required to enable the interest of IJM Plantations Bhd to be protected.

In furtherance of such scams, IJM Plantations Berhad conveniently execute “white papers pre signed or pre thumbed” by those poor natives ( also known as MOT in escrow), so they may at any time transfer, sublease, sell or charge these lands without informing them . Native Titled land owners have absolutely no idea how extensive the acreage owned by them are as no disclosure nor information on the titles, sublease payments nor tax returns has ever been disclosed to them.

The modus operandi of these rampant acquisitions of Native Titled lands in the pretext of lease legally obtained by IJM plantations Berhad by using so called “proxies”or “nominees” to purchase the native lands gives the notion that Jabatan Tanah & Ukor Sabah concurs with such illegal arrangements and that such practices have not come under any form of scrutiny from the supposed guardian of the NT lands in many of the interior areas of Sabah. In some cases, the Jabatan Tanah & Ukor Sabah and its PPHT Offices throughout Sabah even deem this manner of arrangement legal and valid and proceed to register these sublease on the titles. This in spite of it being patently clear that they are in defiance of the Sabah Land Ordinance. RM 1 for transfers and subleases in some cases are simply baffling!

These public listed companies, foreigners, and non natives then amass millions of ringgit enterprise by representing ownership through their many illegal agreements while the registered Owners (natives), in line with such nominal ownership, remain poor.

The entire dealings are fraudulent and circumvent the law and abuse the protection afforded to Sabahan natives rights and native titles. The authorities lackadaisical attitude over the fundamental rights of the Natives over their lands can be seen in the fact that there are numerous land cases where the Natives initiatives to have their NT lands officially protected have failed.

Pursuant to the Sabah Land Ordinance, it is normally illegal for any major corporation, foreigner and non native to own Native Titles in Sabah. Based on numerous complaints to the Sabah Courts of Non Natives using Natives nominees to purchase Native lands on their behalf, the Sabah Government and Chief Minister Musa Aman should immediately consider a new law to crack down on the use of Native nominees to purchase Native Titles. Such a new law should provide for punishment for individuals (including lawyers, brokers and agents) offering advice to Non Natives on how to hold NT Titles property by concealing and disguising their transactions. The intended law should also allow the seizure of non-natives land found guilty of holding the Native Title property to transfer the land to another Native or to sell it within 30 days.

There should be a balance between protecting Native interest while still welcoming investment into Sabah.

The growing people’s protest are proof of the intolerable impact of land grabbing on local communities by major corporations, companies, foreigners and non natives.

Native communities are losing control of the land, along with their rights to be consulted and to pursue agrarian reform programs. We must remember that the indigenous people were here first and that means something – socially, economically and legally.

Sabah’s poor natives need help to reclaim what is rightfully theirs. Only the State Government under Chief Minister Musa Aman can do something for a problem that has been running for over two decades.

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