THE Malaysian government has approved the transformation of the Civil Aviation Authority of Malaysia (CAAM) into a Statutory Body with Separated Remuneration and Exempted (BBDSB) status, effective 1 August, said Transport Minister Anthony Loke.
Speaking at a press conference, Loke confirmed that the Cabinet had endorsed the proposal on 11 June.
“This means the statutory body will no longer require financial injections from the government via annual allocations. At the same time, it will no longer be subject to the public service remuneration system,” he said.
“It will be financially autonomous and operate independently of government salary structures. Essentially, CAAM will be a financially self-sufficient body,” Loke added.
He described the decision as part of the government’s broader effort to enhance the strength and credibility of Malaysia’s aviation institutions.
“This is to ensure that Malaysia remains a country with a technically and economically competent aviation regulatory system that meets international standards,” he said.
According to Loke, CAAM is well-positioned to operate as a BBDSB, as it has already demonstrated the ability to generate significant revenue through charges levied on international airlines and airspace users.
“Our projected revenue for this year is approximately RM400 million. In the first five months of the year alone, we have collected around RM150 million – more than the entire revenue of the previous year,” he noted.
“This gives us confidence in CAAM’s financial sustainability and autonomy, which was a key requirement from the Cabinet and the Public Service Department (JPA) for approving BBDSB status,” he added.
Prime Minister Datuk Seri Anwar Ibrahim had previously indicated that the government was considering granting CAAM statutory status with separated remuneration.
The government has finalised legislative steps to dissolve the Malaysian Aviation Commission (MAVCOM) and consolidate its functions under CAAM.
Loke said the Malaysian Aviation Commission (Dissolution) Bill 2024 [Act 856] and the Civil Aviation Authority of Malaysia (Amendment) Bill 2024 [Act A1723] were passed by the Dewan Rakyat on 26 June 2024 and the Dewan Negara on 30 July 2024.
Both acts received royal assent from the Yang di-Pertuan Agong on 11 September 2024 and were gazetted on 25 September 2024.
“These two acts will come into effect on 1 August 2025, coinciding with CAAM’s official designation as a Statutory Body with Separated Remuneration and Exempted (BBDSB) status.
“With the enactment of these laws, the transition of roles and responsibilities from MAVCOM to CAAM can be carried out in full accordance with legal provisions and formally executed,” said Loke.
He added that all MAVCOM personnel would be offered appropriate placements within CAAM based on their skills and experience.
“A public dialogue session will be held to discuss the new salary framework for CAAM staff following the merger with MAVCOM and the expansion of duties.
“Offer letters will be issued to all 57 MAVCOM staff by the end of this month,” he said.
Loke emphasised that the restructuring puts Malaysia in a stronger position to meet global challenges in the aviation sector.
“CAAM will be better equipped to steer the aviation industry towards progressive and sustainable growth.
“This move supports the government’s broader goal to position Malaysia as a regional aviation hub, aligned with national ambitions for inclusive, balanced, and innovation-driven economic development,” he added. - June 23, 2025
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