MyCC gains mileage before race
What is very interesting to note is that even government concessions can be scrutinised by the Malaysian Competition Commission.
THE saying having to learn how to crawl before you can walk does not seem to apply to the role the Malaysian Competition Commission (MyCC) is having to take on even before the Competition Act 2010 comes into force on New Year's Day.
The commission, established under the Competition Commission Act 2010, is barely three months old, but already seems to have a tall order.
MyCC was given but a little over six months to get its house in order - which was to lay out some groundwork and guidelines before January 1 2012.
Then came a deal that saw two aviation rivals who decided to become allies and demarcate their services. The Malaysia Airlines-AirAsia alliance got tongues wagging with questions on whether this move could create anti-competition behaviour and possible airfare increases.
It is understood that, just like to many of us, this tie-up, came as a surprise, even to MyCC. But, instead of just waiting for the Act to come into force (as MyCC doesn't have to do anything until then) and before anyone even prompted it, MyCC decided to initiate a market research on the merger.
So now, MyCC is reviewing this particular deal and plans to advice the parties about the areas where it may cross the line.
While the MyCC has taken its own initiative on this matter, it has at the same time been receiving complaints on abuse of dominant position, possible abuse by monopolies and cartels by major corporations.
Most of the complaints that it receives are on the transport/logistic sector and price fixing of consumer goods.
MyCC, as a watchdog, has the power to probe and enforce the Competition Act 2010. It has the power to conduct market reviews where there may be a monopoly or abuse of power and can undertake to see if the parties being investigated are in fact abusing their powers.
Trade associations most often are caught for price-fixing.
What is very interesting to note is that even government concessions can be scrutinised by MyCC.
Not surprisingly though, a question that is likely to be raised is - could there be interference in the investigations?
It is comforting to note that each report is made available to the public and when deciding to close an investigation, the commission will state so and provide the reasons for closing it.
The powers of a MyCC investigating officer are similar to that of a police officer, whereby, they can enter without a warrant and search and seize documents. They are allowed to even conduct dawn raids.
Unlike other contracts/agreements, oral agreements can also be binding.
While ignorance of the law is no excuse, every general rule has its exceptions.
For example, if an incident doesn't fall within the ambit of certain exempted sectors such as those dealing in matters of national interest, services of general economic interests and collective agreements, they may rely on Section 5 to justify entering into an anti-competition agreement.
Since no special exemptions are provided for government-linked companies, MAS-AirAsia, for example, may be able to fallback on this section.
If the parties can show that there is an identifiable technological, efficiency and social benefits arising from the agreement or perhaps that the detrimental effect of the agreement on competition is proportionate to the benefits.
Another possibility is for the parties to show that the agreement does not completely eliminate competition.
MyCC has 10 members, whose chairman is the former chief judge of Malaya Tan Sri Siti Norma Yaakob and its chief executive officer is Shila Dorai Raj. The committee is supported by seven officers and three staff.
MyCC's first review will be a learning ground and it will set the rules on the things it should look out for in the future. Should the findings be shared, it will illustrate how thorough and independent the body is.
For us consumers, we should be glad someone is looking into these areas, but at the end of the day, all we want are affordable and value for money goods and services, including travel!