KUALA LUMPUR – The Federal Government has decided not to appeal against the special grant based on Sabah’s entitlement to 40 per cent of its revenue.
In a statement, the Attorney General’s Chambers (AGC) said that the Federal Government will instead begin negotiations with the Sabah State Government as soon as possible.
The AGC stated that the Federal Government respects the principle of the Special Grant based on the 40 percent revenue entitlement as provided under the Federal Constitution.
It added that a Special Cabinet Meeting was held today to discuss the Kota Kinabalu High Court’s judgment on Sabah’s Special Grant, which was decided in a judicial review application.
“At the same meeting, the Attorney General presented advice and views to the Cabinet regarding the defects found in the grounds of judgment.
“These include allegations that both the Federal and Sabah State Governments had abused their powers and breached constitutional obligations.
“These allegations would implicate the Federal and Sabah Governments dating back to 1974,” the statement said.
The AGC further said that the grounds of judgment also stated that the post-2021 review was unlawful, irrational, procedurally irregular, and disproportionate.
However, the Federal Government will appeal specifically on the defects found in the grounds of judgment.
“Therefore, the Federal Government has decided not to appeal against the Special Grant based on the 40 percent revenue entitlement.
“In line with that, the Federal Government will immediately begin negotiations with the Sabah State Government,” it added.
The issue of Sabah’s revenue entitlement was also a factor behind Datuk Ewon Benedick’s resignation as Minister of Entrepreneur Development and Cooperatives.
Ewon, who is also the President of the United Progressive Kinabalu Organisation (UPKO), said he stands by his principles and will continue to fight for the implementation of the Malaysia Agreement 1963 (MA63) and Sabah’s constitutional rights.
He added that the Attorney General’s Chambers should not have filed an appeal regarding the 40 percent entitlement issue. – November 11, 2025