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Kobe  University  Global-­‐Link  Forum    Session 1 : “Public Policy Challenges in the Market Societies:

Competition Law and Policy in Malaysia    

6  December  2014  Kuala  Lumpur,  Malaysia  

 RAGUNATH  KESAVAN  

 Member  of  Commission    

Malaysia  CompeFFon  Commission    

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COMPETITION  ACT  2010  (ACT  712)  

An  Act  to  promote  economic  development  by  promoFng  and  protecFng  the  process  of  compeFFon,  thereby  protecFng  the  interests  of  consumers  and  to  provide  for  maRers  connected  therewith  

Came  into  force  on  1  January  2012  

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1995   Fair  Trade  Bill  first  dra2ed  

8MP  &  9MP   Mandate  for  development  of  compe>>on  policy  &  law  

2005   Cabinet  approved  Fair  Trade  Policy  

June  2010   Compe>>on  Act  2010  &  Compe>>on  Commission  Act  2010  enacted  

1  April  2011   Malaysia  Compe>>on  Commission  (MyCC)  established  

1  Jan  2012   Compe>>on  Act  2010  came  into  force  

HISTORY  OF  THE  COMPETITION  LAW  IN  MALAYSIA  

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Policy  discussions  on  CompeFFon  regime  since  1995  

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SCOPE  OF  COMPETITION  

ACT  2010    

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Applies  to  all  commercial  acFviFes  both  within  and  

outside  of  Malaysia    that  have  nega>ve  or    

an>-­‐compe>>ve  effects  in  any  market  in  Malaysia  

   

ANTI-­‐COMPETITIVE  PRACTICES  

ANTI-­‐COMPETITIVE  AGREEMENTS  

(Sec.  4)  

ABUSE  OF  DOMINANT  POSITION  (Sec.  10)  

MAIN  PROHIBITIONS  OF  THE    COMPETITION  ACT  2010

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EXEMPTIONS  a)  Significant  idenFfiable  technological,  

efficiency  or  social  benefits  b)  Benefits  could  not  be  provided  without  the  

anF-­‐compeFFve  agreement  c)  The  detrimental  effect  of  the  agreement  is  

proporFonate  to  the  benefits  d)  CompeFFon  is  not  eliminated  completely  

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What  Are  The  Challenges?  

COMPETITION  LAW  IN  MALAYSIA  

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CHALLENGES  

a)  Excluded  sectors:  •  Three  sectors  are  excluded  from  CA10  -­‐  

regulated  by  their  own  Acts:  -­‐  i.   PETRONAS  (Petroleum  Act  1974)    ii.   MCMC  (CommunicaFon  and  MulFmedia  Act  

1988)    iii.   Energy  Commission  (Energy  Commission  Act  

2001)  10

CHALLENGES  

•  Redundancy  in  enforcement  of  the  CompeFFon  Law.  

•  Non-­‐enforcement  by  sector  regulators  •  How  did  we  address  these?    ü Policy  Advice  ü Special  CommiRee  with  other  sector  regulators  (BNM,  MCMC,  SPAN,  EC,  SPAD)  

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CHALLENGES  

b)  DistorFng  Public  Policies  •  Regulatory  issues  vs  CompeFFon  issues  •  E.g.  BERNAS,  AP  Policies    •  AP:  QuesFonable  AP  awarding  system  •  How  do  we  address  these?    ü  Policy  Advice  ü  Market  Review      

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CHALLENGES  

DifficulFes:  •  To  dismantle  exisFng  public  policies  •  Need  to  do  thorough  assessment  •  Need  the  buy  in  from  poliFcians      

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CHALLENGES  

d)  Professional  Bodies  &  AssociaFons  •  Statutes  allow  anF-­‐compeFFve  pracFce  

such  as  price  fixing.  •  E.g.  BAR  Council,  Medical  (MMA),  Architect  

(MIA)  etc.  •  How  are  we  addressing  these?    ü  Targeted  policy  dialogue  and  briefing  ü  Policy  Advice  

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CHALLENGES  

ü  Promote  Regulatory  Impact  Assessment  (RIA)  and  CompeFFon  Impact  Assessment  (CIA)  

ü  Seminars  and  talks    *Long  Term  Exercise  

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CHALLENGES    

e) Bid-­‐Rigging  • AnF-­‐compeFFve  tender  process  in  Public  Procurement  • E.g.  Education Malaysia Global Services (EMGS), Ministry of Education Malaysia  • How  did  we  address  these?    ü Policy  Advice  ü Seminars  and  talks  ü CollaboraFon  with  MOF  &  NAD  

Policy  Advice  To  the  Government  and  Agencies  

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q    In   total   27   policy   advices   have   been   given   to   the  Government  and  other  Agencies.    q   14  advices  in  2014.  

Impact  of  These  Advices:  • Address  EC  –  the  highest  decision  making  body  • Inves>ga>ng  big  cases  with  maximum  impact  

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New  Development  ExempFons    

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q A  condi>onal  Block  Exemp,on  Order   (BEO)  was  granted   for   liner   shipping  agreements  specifically  Vessel  Sharing  Agreements  and  Voluntary  Discussion  Agreements  made  within  Malaysia  or  has  an  effect  on  liner  shipping  services  in  Malaysia.  

q The  BEO  was  published  in  the  Gaze]e  and  came  into  effect  on  7  July  2014.  

q The  BEO  applies  to  transport  services  provided  by  liner  operators  in  respect  of   ocean   transport   and   does   not   include   any   inland   carriage   of   goods  occurring  as  part  of  through  transport.  No  element  of  price  fixing  or  tariff  in  any  form  is  allowed.  

Enforcement  Cases  Decided  by  the  Commission    

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q  Cameron   Highland   Floriculturist   Associa>on   (CHFA)   –   Decision  (2012)  

q  Barbers  Associa>on  –  Undertaking  (2013)  q  Megasteel  Sdn  Bhd  –  Proposed  Decision  (2013)  q  Malaysia  Airlines  (MAS)  &  AirAsia  –  Final  Decision  (2014)  q  Ice  Manufacturers  –  Proposed  Decision  (2014)  q  Educa>on   Malaysia   Group   Services   (EMGS)   –   Policy   Advice  

(2014)  q  Pan  Malaysia  Lorry  Owners  Associa>on  (PMLOA)  –    Undertaking  

(2014)  

 

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CONCLUSION    

• New  Law  • Difficult  in  changing  landscape  both  in  public  and  private  sector  • RIA  &  CIA  is  the  best  approach  to  jusFfy  the  policy  change  • Slow  and  long-­‐drawn  process  

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