MyCC to determine whether cartels exist in transport sector — Nanta

MyCC to determine whether cartels exist in transport sector — Nanta
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KUALA LUMPUR (Oct 5): The Malaysia Competition Commission (MyCC) will invoke its enforcement power to determine whether there are cartels formed in the port logistic ecosystem and motor vehicle warranty, said Domestic Trade and Consumer Affairs Minister Datuk Seri Alexander Nanta Linggi.

He said MyCC will be looking at possible anti-competition behaviour concerning landside charges, shipping liner charges, depot gate charges (DGC) and fuel adjustment factor as recommended in MyCC's latest Market Review Under Competition Act 2010 for Selected Transportation Sectors released on Tuesday.

"The concession agreement for port operators may also be subjected to review to achieve policy shift in ensuring competition in the relevant market," he told the media after launching the market review on Tuesday.

Nanta said there is also a need to rectify the regulatory and market-driven issues in relation to custom procedure, regulatory framework, standardisation and licensing of off-dock and on-dock players, as well as empowering merger and acquisition control.

Meanwhile, he said MyCC will also enforce its power to determine whether the dealings by car manufacturers in the repair industry raise competition concerns.

"MyCC in its market review has also recommended the introduction of the Lemon Law and other improvements on the warranty process in order to protect the interest of vehicle owners," he added.

Meanwhile, MyCC chief executive officer Iskandar Ismail said there is possible cartel-like behaviour and price-fixing during the introduction of DGC and exclusive dealing between shipping liners and depot operators.

"The behaviour appears to exist when depot operators act together, through the instructions of their association, to agree and fix the price of DGC (RM5) during its introduction.

"Despite each depot operating in different geographical locations and different twenty-foot equivalent unit (TEU) volumes and capacities, it appears that the trend of DGC increments has been similar across multiple depot operators," he said.

Meantime, Iskandar noted that under the motor vehicle warranty review, MyCC found that warranty restrictions imposed by car manufacturers may possibly prevent or restrict competition in the car repair and service industry.

"The exclusionary clauses in the warranty could potentially lead to the market being foreclosed only to franchise workshops within the car manufacturers’ network.

"We also found out issues related to the agreements between car manufacturers and insurance companies that caused the foreclosure of the car accident repair market," he said.