Automatic acquisition and malaysia passport

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Has anyone has experience or knowledge of the following? Your answers are greatly appreciated.

Child born in UK after parent is settled, therefore is BC by automatic acquisition under s1(1).

Child parent is malaysian and wishes to register child as malaysian + malaysian passport. Malaysia does not allow dual citizenship.

How to proceed in this situation? Is home office letter "non-acquisition of BC" required?

I've phoned the malaysia high commission, the answer seem to be that as long as parent and child don't have british passport, they're happy to proceed. However, they seem to have missed the point here, because one can still be BC without british passport.

My concern is the hassle of long journey to London + high comission might be wasted if they reject us on the scene. Therefore, would like to do some background research in advance

[ban.s]

You are right the baby will still be british without a passport. However, as long as passport has not been acquired, the consolute will consider that the baby has not excercised the british citizenship. So they'll offer native passport.
Once baby gets the passport, then apply for certificate of entitlement to the right of abode.

PS: India also don't recognise dual citizenship and offer exactly same thing to the children born to Indian settled citizens.
PPS: Do check with your embassy whether they also require the child's birth to be registered with them as one of the pre conditions.

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ban.s, thanks for your replies

Yes, child need to be registered as oversea born and a registration certificate will be issued