Johor backs licence revocation of Network School as Malaysia expands immigration and security investigations

JOHOR, MALAYSIA: The Johor government has confirmed its full support for the Iskandar Puteri City Council's (MBIP) decision to revoke the business licence of NS0 Malaysia Sdn Bhd, also known as Network School, at Forest City and order the company to cease operations from 22 July 2026.

Johor Chief Minister Datuk Onn Hafiz Ghazi announced the state's position in a Facebook statement published on 21 July, saying the decision followed reviews of inspection reports, enforcement findings and representations submitted by the company in accordance with existing laws and regulations.

Decision followed legal process

Onn Hafiz said enforcement action was taken only after complaints and information had been verified, inspections completed, regulatory non-compliance identified and the legal process concluded.

"The enforcement action can only be taken after complaints and information have been verified, inspections conducted, non-compliance identified and the legal process completed," he said.

He stressed that the length of time a business had been operating did not automatically mean its activities complied with licensing requirements.

"When non-compliance is identified, action must be taken without compromise. The state government will continue to strengthen coordination between agencies so that any non-compliance can be detected and addressed immediately," he said.

The Chief Minister added that Johor remained open to quality investments that contributed to economic growth, created employment 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.

Security and immigration concerns

Onn Hafiz said neither the state government nor local authorities would compromise on breaches of the law or issues affecting national security, sovereignty and national interests.

He called on the Home Ministry, Immigration Department, Royal Malaysia Police and other relevant security agencies to continue their investigations and take firm action if they uncovered misuse of second passports, identity misrepresentation, immigration offences or other violations of Malaysian law.

"This matter cannot be taken lightly, especially as Johor is a strategic gateway to the country bordering Singapore. Any weaknesses or misuse of the immigration system must be addressed immediately, firmly and without compromise," he said.

He also urged the Digital Ministry and the Malaysia Digital Economy Corporation (MDEC) to review Network School's Malaysia Digital status and any official recognition granted to the organisation if it was found to have breached relevant requirements or conditions.

The Chief Minister said government agencies should strengthen due diligence measures by conducting more thorough checks on the ownership, funding sources, operational structures and activities of companies and organisations seeking to operate in Malaysia.

He added that coordination among enforcement agencies should be enhanced to ensure every investment or international initiative was properly assessed for licensing, immigration, security, premises usage and legal compliance.

According to Onn Hafiz, the matter had been presented to and received the consent of the Yang di-Pertuan Agong and the Johor Regent, Tunku Mahkota Ismail.

Federal investigations continue

MBIP had earlier issued a Stop-Business Notice on 17 July against premises linked to Network School's operations at Forest City.

The local authority's enforcement action comes as federal agencies continue separate investigations into the identities and immigration status of individuals associated with the organisation following allegations that some participants could be Israeli nationals.

The Home Ministry announced last week that investigations were under way, stating that the government would not compromise with any individual or organisation found to have misused Malaysia's immigration facilities or engaged in activities that contravened the law or threatened national security, public order or national sovereignty.

The investigation followed an earlier request by Onn Hafiz for a coordinated probe involving the Home Ministry, the Immigration Department, Royal Malaysia Police, the Royal Malaysian Customs Department and other relevant security agencies.

Prime Minister Datuk Seri Anwar Ibrahim has also addressed the issue, saying the government would expel any Israeli nationals found to be involved with Network School.

Immigration tracing 19 individuals

Separately, the Immigration Department said on 21 July that it was attempting to trace 19 of 430 foreign visitors linked to Network School's operations.

Immigration Director-General Datuk Zakaria Shaaban said officers were working to determine the immigration status and whereabouts of the individuals.

Department records showed that 430 foreign visitors had been identified in connection with the investigation. Of these, 210 remain in Malaysia, 201 have left the country and the movements of 19 individuals have yet to be verified.

"We are identifying their whereabouts and will conduct further investigations to determine whether they are still in Malaysia or have already departed," Zakaria told Malaysian media.

He said inspections had found no evidence that visitors had misused their passports.

"They were travelling on valid passports issued by their respective countries," he said.

According to local media reports published on 16 July, the Immigration Department had also found no evidence that Israeli nationals were present at the facility during earlier inspections.

Officials said 266 foreign nationals from 40 countries had been inspected and all were found to possess valid travel documents.

Nevertheless, authorities said further investigations would continue to verify compliance with Malaysian immigration laws and other legal requirements governing entry into the country.

Investment plans suspended

The developments have also affected Network School's investment plans in Malaysia.

On 17 July, American technology investor Balaji Srinivasan, who is behind the organisation, announced that Network School had suspended further investment in Malaysia, including a planned RM500 million (US$122 million) expansion.

Balaji said the organisation now saw "two paths forward" depending on whether Malaysia wished to continue attracting international technology investment.

He added that, if the government remained open to such investment, he hoped to meet Prime Minister Anwar Ibrahim to discuss the possibility of negotiating a memorandum of understanding that would allow Network School to continue operating and investing in Malaysia.