Tech commune Network School in Johor’s Forest City ordered to cease operations from July 22

JOHOR BAHRU – Johor’s Iskandar Puteri City Council (MBIP) has revoked Network School’s business licences and ordered the company to cease its operations in Forest City with effect from July 22 over licensing and premises-use violations.

The technology start-up co-living and co-working project has been at the centre of a controversy after allegations that it has hosted Israeli participants using second-country passports, prompting the Malaysian authorities to launch an investigation.

Malaysia does not have diplomatic ties with Israel owing to its pro-Palestine stance. Israeli passport holders are barred from entering Malaysia unless granted special permission by the Home Ministry.

However, Israeli citizens cannot be barred if they enter using passports from other countries – itself a practice that is not unlawful.

In a statement on July 21, MBIP said the decision was made during a special full council meeting following inspections and enforcement checks carried out at the company’s premises on July 12, 14, 19 and 20.

The local authority said enforcement action was taken after the company was found to have breached licensing conditions and premises usage requirements under its jurisdiction.

For a unit located at Teluk Bintang in Jalan Forest City 5 in Pulau Satu Forest City, MBIP said the company had been operating without a business licence.

As a result, it issued a Stop Business Notice under the Iskandar Puteri City Council Trade, Business and Industrial Licensing By-Laws 2018.

Meanwhile, MBIP revoked the business premises and advertising licences for another unit in Jalan Forest City 5 after finding that business activities carried out at the premises differed from those approved under its office-use licence.

The council also issued a notice requiring the company to comply with its advertising licence after determining that the signboard displayed at the premises did not match the approved application.

Johor Menteri Besar Onn Hafiz Ghazi said he supported the decision, and that the move was taken in accordance with existing legal provisions after the authorities reviewed inspection reports, enforcement findings and representations submitted by the company.

“The enforcement action was taken only after complaints and information were verified, inspections were conducted, non-compliance was identified and all legal processes were completed,” he said in a statement on July 21.

Onn Hafiz stressed that the length of time a premises had been operating did not necessarily mean all of its activities had consistently complied with licensing conditions.

“When non-compliance is identified, action must be taken without compromise,” he said, adding that the state government would strengthen coordination among enforcement agencies to ensure any future breaches could be detected and addressed promptly.

He reiterated that Johor remained open to high-quality investments that contributed to economic growth, created jobs and supported the state’s development.

“However, no investor, company or organisation can be placed above the sovereignty of the country’s laws,” he said.

Onn Hafiz emphasised that the state government and local authorities would not compromise on any violations of the law or matters that could jeopardise national security, sovereignty or public interest.

He also urged the Home Ministry, Immigration Department, police and other relevant security agencies to continue their investigations and take stern action if offences involving the misuse of second passports, identity misrepresentation, breaches of entry conditions or other violations under Malaysian law were uncovered.

He said the matter should not be taken lightly, particularly as Johor was the country’s strategic gateway bordering Singapore, adding that any weaknesses or abuse of the immigration system must be dealt with swiftly and firmly.

Onn Hafiz also called on the Digital Ministry and the Malaysia Digital Economy Corporation to review the company’s Malaysia Digital status or any recognition granted to it should there be any breach of the stipulated conditions or principles.

He urged all relevant agencies to tighten their due diligence processes, including background checks on ownership, funding sources, operational models and the narratives promoted by companies or organisations seeking to operate in the state.

Onn Hafiz said coordination between agencies should also be enhanced to ensure that every international investment and initiative is comprehensively assessed in terms of licensing, immigration, security, premises usage and legal compliance.

“The Johor government will continue working closely with all parties to ensure the state remains a trusted investment destination without compromising on national security, sovereignty or the rule of law,” he said.

Onn Hafiz added that the matter had been presented to the Malaysian King, Sultan Ibrahim Iskandar, and Johor Regent, Tunku Ismail Sultan Ibrahim. THE STAR/ASIA NEWS NETWORK