The Cabinet has approved the proposal to restructure the Civil Aviation Authority of Malaysia (CAAM) into a statutory body with independent remuneration and exemption. This change will be implemented through a merger between CAAM and the Malaysian Aviation Commission (Mavcom) that takes place on 1 August 2025.
The legal foundation for the merger was established through the Malaysian Aviation Commission (Dissolution) Bill 2024 and the Civil Aviation Authority of Malaysia (Amendment) Bill 2024. Both bills were passed by the Dewan Rakyat on 26 June 2024, followed by approval from the Dewan Negara on 30 July 2024.
They received royal assent from His Majesty Sultan Ibrahim on 11 September 2024. The bills were officially gazetted on 25 September 2024. Both acts will come into force on 1 August 2025, aligning with the effective date of the merger between CAAM and Mavcom.
According to Transport Minister Anthony Loke, through the merger, CAAM will take over Mavcom’s economic regulatory functions and operate under its own terms and conditions. It will be responsible for technical, safety, and economic oversight.
He added that all 57 Mavcom employees will be offered positions at CAAM, based on their skills and experience. The transition, he said, will follow strong governance principles and be supported by a comprehensive Business Continuity Plan (BCP) to ensure seamless regulatory oversight.
Furthermore, CAAM recorded approximately RM150 million in revenue during the first five months of the year and is projected to reach RM420 million by year-end. According to Transport Minister Anthony Loke, these figures have given CAAM the financial confidence to operate independently.
Loke also noted that CAAM’s shift to independence is expected to save the government between RM150 million and RM200 million annually — or roughly RM1.5 billion to RM2 billion over the next decade. Previously, CAAM relied on government funding within that range to maintain operations.
Additionally, the Aviation Services Charges that have been revised and applied to airlines since January this year will also contribute to CAAM’s revenue. “The majority of the revenue comes from foreign airlines using our airspace. We hadn’t reviewed these charges since the 1980s, and we finally did so in recent years,” he said.
All in all, through this merger, CAAM will be playing a key role in the aviation industry and to help the country’s vision in becoming competitive in the industry. “With this initiative, Malaysia is better positioned to revitalise and grow its aviation sector sustainably,” Loke added.
