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MyCC fines port warehouse operators RM1m for price-fixing, calls on cartels to reach out

KUALA LUMPUR (Aug 9): The Malaysia Competition Commission (MyCC) has imposed penalties totalling RM1.04 million against seven warehouse operators for price-fixing offences for handling of cargoes in Port Klang between May 2017 and December 2019.

The seven warehouse operators are SAL Agencies Sdn Bhd, WCS Warehousing Sdn Bhd, Regional Synergy (M) Sdn Bhd, Intrexim Sdn Bhd, Pioneerpac Sdn Bhd, Prima Warehousing Sdn Bhd and Interocean Warehousing Services Sdn Bhd.

The operators engaged in a price-fixing cartel in relation to the handling services for long length and heavy lift of import and export cargoes which constituted an infringement under Section 4 of the Competition Act 2010, MyCC said.

The penalties ranged between RM26,363.03 to RM336,369.13 for each company, it said.

“The amount respectively imposed on the warehouse operators is not more than 10% of their worldwide turnover.

“In the process of determining the penalty, MyCC has considered the impact of the current economic situation together with the presence of mitigation and aggravating factors in the case,” MyCC said.

The companies are also directed to refrain from engaging in price-fixing agreements in the future.

MyCC further directed the parties to independently determine their future charges for long length and heavy lift of import and export cargoes, it said.

The commission said it was uncovered that the operators had created a WhatsApp Group and began their discussion on fixing the surcharges despite acknowledging that they are all competitors in the warehouse services market.

The same raid also unearthed the operators’ cartel agreement in the form of a document called ‘Surcharge Memorandum’ dated May 22, 2017 where all operators agreed that all of them would charge the agreed rates effective from June 1, 2017.

“In any rate, cartel is the supreme evil of competition law,” MyCC chief executive officer Iskandar Ismail said.

“MyCC has always given high priority to the investigation and punishment of anti-competitive agreements, especially price and quota cartels, customer or territorial allocation agreements and bid-rigging too.

“The perpetrators of these cartels, quite literally, are stealing money from the pocket of businesses and consumers,” said Iskandar.

Iskandar added that those who are already involved in a cartel should approach MyCC “via leniency regime application” or any other appropriate scheme as provided under Competition Act 2010.

“MyCC’s door is always open for parties who may want to seek redemption,” Iskandar said.

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