KUCHING: The enforcement of the Competition Act 2010 on January 1, 2012 will transform all business practices and will make the business environment in Malaysia more favourable for foreign investments, besides keeping the markets more competitive.
“The Act will regulate all types of businesses from multinational companies, small and medium enterprises (SMEs) to small stores,” said the head of the Interim Competition Commission Unit of the Ministry of Domestic Trade, Co-operatives and Consumerism, Shila Dorai Raj during a seminar on Goods and Services Tax (GST) and Competition Act.
The seminar was jointly organised by the Ministry of Industrial Development Sarawak, Ministry of Domestic Trade, Cooperatives and Consumerism and Sarawak Chamber of Commerce and Industry yesterday.
The Competition Act 2010 was passed by the Parliament in May 2010 and gazetted in June 2010.
Except for anti-competitive practices regulated under the Communications and Multimedia Act 1998 and Energy Commission Act 2001, the Competition Act 2010 provides a comprehensive competition law at the national level which cuts across all economic sectors.
The Competition Act 2010 applied to all commercial activities undertaken within Malaysia and those outside Malaysia which had effects on competition in the Malaysian market.
She pointed out that the main aims of the Competition Act 2010 were to promote economic development by promoting and protecting the process of competition in the Malaysian market
in order to maximise consumer welfare.
This, she said was achieved through the prohibition of anti-competitive practices.
According to a source from the Ministry of Domestic Trade, Co-operatives and Consumerism, a Competition Commission will be established to oversee the implementation of the
Competition Act 2010.
The Competition Commission will investigate against any potential anti-competitive practices and will also be empowered to impose financial penalties. However, decisions by the Competition Commission may be appealed to the Competition Appeal Tribunal.
On the other hand, Dr Wafi Nazrin Abdul Hamid, the senior vice president for Corporate Services of Malaysia Airlines (MAS), who is also the committee member of the Interim Competition Commission Unit, said the Competition Act 2010 would benefit everyone.
According to him, currently, a lot of prices of goods and services in Malaysia were fixed and once the Competition Act 2010 was fully implemented, price fixing was no longer allowed among businesses.
“The beauty of this Act is that the prohibitions under this Act apply to all commercial activities and government-linked companies,” he said.
There were three provisions under the Competition Act 2010; prohibition against anti-competitive agreement which prohibited any horizontal or vertical agreement which had
the object or effect of significantly preventing, restricting or distorting competition in Malaysia.
Prohibition against abuse of dominant position which prohibited abuses by enterprises occupying ‘dominant positions’ in the market they were operating in and the power to conduct market review which stated that the Competition Commission may conduct a review into any market in order to determine whether any feature or combination of features of the market prevented, restricted or distorted competition in the market.
Such a review would be published and made available to the public. Wafi Nazrin further noted that the Competition Act 2010 did not take away the power of the government in granting privileges to businesses. The Act gazetted in June this year was passed by Parliament in May.