The Kuala Lumpur Regional Centre for Arbitration (KLRCA) in Malaysia has introduced a new set of arbitration rules just a month after foreign lawyers got the green light to advise clients in the country without having a local office.

The new rules, which come into effect today, are aimed at bringing Malaysian arbitration proceedings in line with those of more sophisticated markets by incorporating international arbitration standards.

Among the new instructions is a provision for emergency arbitration, giving an option for parties to apply for urgent interim relief, as well as a provision for arbitrators to grant pre-award interest and an option for the consolidation of proceedings and concurrent hearings.

The KLRCA has also sought to enhance its confidentiality rules restraining the cases where the matter can be disclosed, and has revised its schedule of fees and administrative costs so that the apportionment of fees and costs are relative to parties' claims and counterclaims respectively.

"The new rules have made us competitive compared with the other centres for disputes in Asia – we have the same arbitrators but our fees are 20% less," said Sundra Rajoo, the director of KLRCA.

"Prior to March 2010 and despite being the first regional arbitral institution to be established, we were trailing behind the newer arbitral centres in other countries. We had about 10 cases.

"Then last year we did 84 cases, this year we have already done 110 cases and we will do about 130 cases by the year end. So we've seen phenomenol growth. We also have a panel of 576 of foreign and domestic arbitrators, compared with less than 200 previously.

"By 2016 I expect at least 250 cases. We are confident we will continue to grow." 

The new arbitration rules coincide with the liberalisation of Malaysia's legal market.

In September, parliament passed its second set of amendments to the Legal Profession Act, allowing foreign law firms to advise clients in Malaysia on a fly-in and fly-out basis as the market opens up, so long as their stay does not exceed 60 days per lawyer per year.

At the same time, authorities clarified the rules for foreign lawyers entering the country for arbitrations, confirming that those seeking to appear as counsel in either international or domestic proceedings would be permitted to enter the country at any time and with no limit on the duration of their stay.

Last year parliament passed the first set of amendments to the act, which specified new rules for allowing foreign firms to open a local base in the country – either as Qualified Foreign Law Firms (QFLF) or through joint law ventures with local outfits.

The country is preparing for an influx of foreign firms once the amendments come into force.

The liberalisation of Malaysia's legal market comes as other jurisdictions including Singapore and Korea have also begun to open up to foreign firms. 

The new arbitration rules have been announced amid a similar move by Hong Kong, as all of Asia's main legal hubs look to become a centre for international disputes in the region.

In the second half of 2014, the KLRCA will move to new premises in a bid to boost its infrastructure and modernise its facilities.