Prime Minister Lee Hsien Loong has defended Singapore's proposed law to fight "online falsehoods," but his Malaysian counterpart Mahathir Mohamad warned that anti-fake news laws could be abused by governments to stay in power.

The two leaders were speaking after talks Tuesday aimed at resolving territorial disputes that had strained ties since Mahathir's alliance swept to power in elections last May.

Lee said many countries including France, Germany and Australia have legislation to combat fake news.

The bill unveiled last week includes a jail term of up to 10 years and hefty fines. Rights groups have voiced fears it could stifle free speech, but Lee said their objective is "to continue to do things that will work for Singapore."