OECD kpcdb

1. Competition Law

 

The Competition Act 2010 (the “Act”) and Competition Commission Act 2010, both of which took effect in 1 January 2012, are the main legal instruments on competition policy in Malaysia. 

 

The object of the Act is to promote economic development by promoting and protecting the process of competition, thereby protecting the interests of consumers. 

 

The Act regulates anti-competitive agreements and abuse of dominant position under the name of anti-competitive practices. Merger control is not within the purview of the Act and will thus not be subject to the following text.

 

General exclusion: What is regulated under Communication and Multimedia Act 1998, Energy Commission Act 2001, Petroleum Development Act 1974 and the Petroleum Regulations 1974 are excluded from the application of the Act. 

 

Aviation services in Malaysia are governed exclusively by the competition provisions set out in the Malaysian Aviation Commission Act 2015.

 

Under Section 2 of the Act, the Act applies to any entity carrying on commercial activities. 

 

State-controlled firms are thus not exempt from the application of competition law when conducting commercial activities in competition with private firms.

 

Extra-territorial application: The Act is applicable to commercial activity transacted outside Malaysia which has an effect on competition in any market in Malaysia pursuant to Section 3 of the Act.

 

2. Malaysia Competition Commission

 

The Malaysia Competition Commission (“MyCC”) is the authority that enforces the Act in Malaysia. The Competition Commission Act 2010 (the “Commission Act”) provides for the establishment of the Competition Commission, and sets out the powers and functions of the Commission. 

 

The MyCC investigates and adjudicates on suspected anti-competitive behaviour.

 

According to the Commission Act, the main function of the MyCC is to implement and enforce the provisions of the Act, issue guidelines on implementation and enforcement of competition laws, perform as competition advocate, carry out general studies on competition issues in the Malaysian Economy, and inform and educate the public regarding how competition benefits consumers in Malaysia.

 

Organisational structure of MyCC: 

 

The MyCC is located in Kuala Lumpur and the total number of staff is 47 as at 2014. 

 

MyCC currently has 5 units: Strategic unit, Investigation & Enforcement, Management Services, Legal Unit, and Corporate Communication Unit. 

 

Under Section 5 of the Commission Act 2010, MyCC consists of a Chairman, four members representing the Government, and not less than 3 but not more than 5 other members who have experience and knowledge in matters relating to business, industry, commerce, law, economics or any other suitable qualification as the Minister charged with the responsibility for domestic trade and consumer affairs (the “Minister”) may determine. 

 

They shall be appointed by the Prime Minister upon the recommendation of the Minister.

 

Other regulators with competition powers: The Malaysia Communication and Multimedia Agency is responsible for the enforcement of competition related provisions under the Act 588 of Malaysia, while the Energy Commission is responsible for the enforcement of competition related provision under Malaysia’s Act 610. The Malaysian Aviation Commission is responsible for the application of competition rules under the Malaysian Aviation Commission Act 2015, particularly Part VII (Competition).

 

Competition advocacy: As an active advocate for competition, the MyCC can perform competition assessment on all new public policies that may have implications for competition. 

 

The MyCC also conducts under Section 11(1) a market study on its own initiative or upon the request of the Minister, in order to determine whether any feature of the market at issue prevents, restricts or distorts competition in the market. Upon conclusion of the market review, the MyCC publishes a report of its findings and recommendations, which is available to the public, although the relevant government is not required to publicly respond to this recommendation.

 

International co operation: the MyCC has signed no international co operation agreements or MOU regarding competition law matters. 

 

3. Investigation

 

Initiation of investigation: An investigation may start in three ways. Under Section 14 of the Act, the MyCC may conduct investigations, if it suspects that there is an infringement. The MyCC shall also investigate any suspected infringements, on the direction of the Minister. 

 

Finally, under Section 15 the Act, the MyCC may conduct an investigation on any enterprise upon a complaint filed with the MyCC. 

 

Powers of investigation: Section 17 stipulates that the MyCC officer investigating any alleged offence shall have any and all powers of a police officer in relation to police investigation as provided for under the Criminal Procedure Code.

 

Under Section 18, 19, and 20 of the Act, the MyCC has the power to require provision of information, retain any document, and access to records for investigation. 

 

Section 25 sets forth that a Magistrate, upon written information on oath from the MyCC officer and after such inquiry as the Magistrate considers necessary, may issue a warrant authorising the Commission officer to enter the premises, if need be by force, and conduct the search and seizure of any record, book, account, document, computerised data or other evidence. 

 

Under Section 26, the MyCC officer may also conduct the search and seizure without a warrant as full and ample a manner as if the officer has the warrant, if he or she has a reasonable cause to believe that obtaining a warrant may delay investigation, adversely affect investigation, or make the evidence tampered, removed, damaged or destroyed, etc. 

 

Under Section 27 the MyCC officer conducting a search shall be granted access to computerised data. 

 

However, over the last five years, the MyCC has not performed any unannounced inspections in the premises of firms investigated for a possible antitrust infringement.

Failure to comply with an investigation: Section 23 and 24 of the Act prescribes that any conducts, giving false or misleading information, evidence or document, or destruction, concealment, mutilation or alteration of records, etc. are deemed to constitute an offence. 

 

Section 32 also sets forth that any person who refuses any MyCC officer access to his or her premises, or assaults, obstructs, hinders or delays any officer is deemed to have committed an offence.

 

Procedural fairness: The MyCC provides the party/parties under investigation for an antitrust infringement with opportunities to consult with the MyCC with regard to significant legal, factual or procedural issues during the course of the investigation. The parties also have the right to be heard and present evidence before the imposition of any sanctions or remedies for having committed an antitrust infringement.

 

In addition to the Act, six guidelines specify and explain the investigative procedures of the MyCC. All such guidelines are available at: http://mycc.my/final-guidelines. 

 

4. Remedies and sanctions

 

The MyCC imposes administrative sanctions for an infringement of a prohibition under Part 2 of the Act (anti-competitive agreements and abuse of dominant position) as specified in Section 40. 

 

Should the MyCC determine that there is an infringement, it may require the infringement be ceased or remedied immediately or may give any other direction as it deems appropriate.

 

The MyCC may also impose financial penalties. Any financial penalty imposed by the MyCC shall not exceed 10% of the worldwide turnover of an enterprise over the period during which an infringement occurred.

 

Under Section 35, and where an investigation is not yet concluded, the MyCC can give directions to suspend any agreement or conduct which is suspected of infringing the prohibitions. 

 

Where a party has failed to comply with a direction under Section 35 or to an infringement decision, the MyCC can refer the matter to the Malaysian High Court, which may make an order requiring the party to comply with the direction or decision. Any breach of such a court order constitutes contempt of court. 

 

5. Appeal

 

A person who is aggrieved or whose interest is affected by the MyCC’s decisions, namely finding of non-infringement or finding of an infringement, as prescribed in Section 35, 39, or 40 of the Act, may appeal to the Competition Appeal Tribunal under Section 51 of the Act. 

 

Section 44 of the Act establishes the Competition Appeal Tribunal which shall have exclusive jurisdiction to review any decision made by the MyCC. Section 45 sets forth that the Competition Appeal Tribunal shall consist of a President- a judge of the High Court- and 7 to 20 other members, who have the relevant expertise in industry, commerce, economics, law, accountancy or consumer affairs, appointed by the prime minister on the recommendation of the Minister.

 

6. Private enforcement 

 

Section 64(1) of the Act sets forth that any person who suffers loss or damage directly as a result of an infringement under Part 2 of the Act shall have a right of action for relief in civil proceedings in a court against any enterprise which is or which has been a party to such infringement. 

 

Section 64(2) of the Act also stipulates that the action may be brought by any person referred to in Section 64 (1) regardless of whether such person dealt directly or indirectly with the enterprise.