Thursday 28 Mar 2024
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KUALA LUMPUR (Nov 27): A Cambodian firm and its representatives have been ordered to pay US$8.04 million (RM33 million) in damages to two wholly-owned Cambodian subsidiaries of Tan Chong Motor Holdings Bhd.

Tan Chong said the order against Narita Motorcare (Cambodia) Co Ltd and its representatives, Long Narith and Pich Sokhom, was made by the Court of First Instance in Phnom Penh.

In a filing with Bursa Malaysia today, Tan Chong said the court has also dismissed all claims made by Narita, Narith and Sokhom against the two subsidiaries, ETCM (C) Pty Ltd and Tan Chong Motor (Cambodia) Pty Ltd (TCMC).

The court also confirmed the non-existence of any agreement between Narita and ETCM and TCMC, and ordered all litigation costs to be paid by Narita, Narith and Sokhom.

In 2010, ETCM was appointed the sole and exclusive distributor of Nissan's completely built-up vehicles in Cambodia by Nissan Motor Co Ltd.

This resulted in ETCM taking over the Nissan distributorship from the then distributor, Denmark-based Kjaer Group, which had appointed Narita as its non-exclusive dealer for Nissan vehicles in Cambodia.

Subsequently TCMC was appointed to distribute Nissan vehicles in Cambodia, including the right to appoint dealers to sell Nissan vehicles.

ETCM then went into talks with Narita to appoint Narita as a non-exclusive dealer in Phnom Penh.

Narita, however, contended that in practice they had always been allowed by Kjaer Group to play the role of sole distributor of Nissan vehicles in the whole of Cambodia, with the right, among others, to import Nissan vehicles into the country.

ETCM's negotiation with Narita dragged on for years until Narita filed a motion for a preservative relief order. However, the Court of Appeal ruled in favour of ETCM and TCMC in September 2016, after an appeal motion was filed.

But on April 26 this year, Narita, Narith and Sokhom unexpectedly filed a motion to add and correct a complaint and a counter complaint to, among others, order ETCM and TCMC to pay damages and compensation of US$6.55 million to Narita, and US$200,000 each to Narith and Sokhom.

In response, on May 9, ETCM and TCMC jointly filed a third motion to correct the counter complaint. Besides seeking US$33 million, ETCM and TCMC sought to dismiss all claims by Narita, Narith and Sokhom, and a confirmation that no agreement existed between Narita and ETCM and TCMC.

Tan Chong's share price rose 2 sen or 1.3% to close at RM1.55, for a market capitalisation of RM1 billion.

 

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