Malaysian Competition Law – Core Concepts & Cases

65 Question-and-Answer flashcards summarising key doctrines, statutory sections, tests, and landmark Malaysian/EU cases relevant to the Competition Act 2010, Section 4 anti-competitive agreements, Section 10 abuse of dominance, exclusions, exemptions, procedures, and institutional framework.

What is the basic definition of competition in a market context?

A process of rivalry among firms striving to win customers by offering better products, prices, or services.

Name two consumer-focused advantages of competition.

(i) Lower prices, (ii) Better quality and wider choice of products.

Which 2020-present US case challenges Apple’s App Store commission rules?

Epic Games v Apple.

Under Section 3(1) CA 2010, where does the Act apply?

To any commercial activity in Malaysia and to activities abroad that affect competition in a Malaysian market.

Give one example of commercial activity NOT covered by the Competition Act under Section 3(4).

Purchasing goods for personal consumption (non-commercial purpose).

List the three classical efficiencies promoted by competition theory.

Allocative efficiency, productive efficiency, and dynamic efficiency.

What is meant by a ‘contestable market’?

A market with low entry and exit barriers where potential competition restrains incumbent firms from raising prices.

State the primary statutory objective of the Malaysian Competition Act 2010.

To prohibit anti-competitive conduct in order to promote competition for the benefit of consumer welfare and economic efficiency.

Define ‘consumer welfare’ in competition law.

The difference between the price consumers are willing to pay and the price they actually pay.

What two-step analytical process does MyCC follow to prove harm to consumer welfare?

(1) Assess the state of competition in the relevant market, (2) Analyse the negative effects of the alleged conduct on that competition.

Give three common harms caused by cartels.

Higher prices, reduced choice, and lower product quality or innovation.

Name four main practices controlled by competition law in Malaysia.

(1) Anti-competitive agreements, (2) Abuse of dominance, (3) Mergers & acquisitions (future), (4) Public restrictions on competition, plus (5) Bid rigging.

What is a ‘theory of harm’ in competition analysis?

A framework explaining how a conduct can exclude rivals or exploit consumers, and how that ultimately harms competition and consumer welfare.

Which EU case overturned a Commission decision for failing to show the counterfactual in a network-sharing deal?

O2 (Germany) GmbH & Co OHG v Commission (T-328/03).

Under Section 4(1) CA 2010, what must be shown about an agreement for it to be prohibited?

That its object OR effect is to significantly prevent, restrict, or distort competition in any Malaysian market.

List the four ‘hard-core cartel’ categories deemed illegal by Section 4(2).

(a) Price-fixing, (b) Market or supply sharing, (c) Limiting production/market access/technology, (d) Bid-rigging.

In Malaysian law, what is the legal consequence once an agreement is classified as having an anti-competitive ‘object’?

Harm is presumed; MyCC need not prove effects unless parties claim efficiency relief under Section 5.

Which Malaysian case involved a market-sharing agreement between two airlines?

Malaysia Airlines System Berhad & AirAsia Berhad (‘MAS–AirAsia’).

What are the four cumulative criteria for a Section 5 relief of liability?

(a) Significant efficiency/social benefits, (b) Indispensability, (c) Proportionality between harm and benefit, (d) No elimination of competition.

Give one example of a Malaysian decision involving price-fixing under Section 4(2)(a).

Professional Insurance Association of Malaysia (PIAM) & 22 insurers fixing motor repair rates.

What is ‘resale price maintenance’ (RPM)?

A vertical agreement where a supplier forces a dealer to sell at, above, or below a specified price, limiting price competition.

Under Section 10, when does dominance itself become unlawful?

Dominance is not illegal; only the abuse of a dominant position is prohibited.

State two common exploitative abuses under Section 10(2).

(i) Imposing unfair/excessive prices, (ii) Imposing unfair trading conditions.

What is a ‘margin squeeze’?

When a vertically-integrated dominant firm sets upstream prices so high (or downstream prices so low) that efficient downstream rivals cannot compete profitably.

Which Malaysian case analysed a margin-squeeze allegation in the steel sector?

MyCC v Megasteel Sdn Bhd.

Section 10(2)(d) targets discriminatory conduct. What additional test must be met to find abuse?

That the discrimination discourages market entry or seriously harms an equally efficient competitor.

Give an example of abusive tying found by MyCC.

MyEG forced users of its immigration permit platform toward insurance sold by its own affiliate (MyEG Commerce).

Name the cost benchmark often used to prove predatory pricing.

Average variable cost (AVC) or average avoidable cost (AAC).

Which landmark EU case sets a 50 % market-share presumption of dominance?

AKZO Chemie BV v Commission.

Mention three barriers to entry MyCC considers when assessing dominance.

Economies of scale/scope, regulatory licensing, and control of essential inputs or distribution.

What body hears appeals against MyCC decisions?

The Competition Appeal Tribunal (CAT).

List two grounds on which the Minister may amend the First Schedule exclusions.

Public consultation (minimum 30 days) and publication of the order in the Gazette after considering submissions.

What is the difference between an exclusion and an exemption in Malaysian competition law?

Exclusion: automatic, permanent carve-out listed in the Schedules. Exemption: conditional, time-limited relief granted by MyCC (individual or block) upon application.

Give one example of an activity excluded because it is ‘in exercise of governmental authority’.

Issuing driving licences by a government department.

What does SGEI stand for and why is it relevant?

Service of General Economic Interest – certain public-service operators may be excluded from the Act if competition rules would obstruct their mandate.

Which Section allows businesses to apply for an individual exemption?

Section 6 of the Competition Act 2010.

Which Section empowers MyCC to grant a block exemption?

Section 8 of the Competition Act 2010.

Name three typical red flags of bid-rigging cartels.

Very similar bids, bid rotation patterns, or coordinated bid withdrawals.

What penalty can a Malaysian company face for general offences like destroying evidence during an investigation?

A fine up to RM5 million (RM10 million for repeat offenders).

State one EU case demonstrating discriminatory abuse without direct competition between parties.

British Airways v Commission (travel-agent commissions).

How does ‘collective dominance’ differ from single-firm dominance?

Control over a market is held jointly by a few firms that can coordinate behaviour without an explicit cartel agreement.

What is the main analytical tool MyCC uses to define a relevant market?

The Hypothetical Monopolist Test (SSNIP test).

Explain ‘countervailing buyer power’.

Large or powerful buyers constrain a supplier’s ability to exercise market power, potentially negating dominance.

Which Section states that market share alone is not conclusive evidence of dominance?

Section 10(4) CA 2010.

Under Section 10(3), what must a dominant firm show to rely on a ‘commercial justification’ defence?

That its conduct was reasonable, proportionate, and objectively necessary to protect legitimate business interests.

What is the maximum jail term for individuals convicted of general obstruction offences under the Act?

Up to 5 years (plus another 5 for repeat offences).

Which statutory instrument created the Malaysia Competition Commission?

The Competition Commission Act 2010.

How long is a Commissioner’s term on the MyCC board?

Maximum 3 years, renewable once (total 6 years).

What type of private action does the CA 2010 allow for victims of anti-competitive conduct?

Civil damages claims by any person suffering loss directly caused by the infringement.

State one circumstance where vertical non-price restrictions may still raise competition concerns.

When the supplier or buyer possesses more than 25 % market share and the restriction forecloses rivals (e.g., exclusive purchasing obligations).

What is ‘deadweight loss’ in the context of monopoly?

The loss of economic welfare when production is below competitive levels, so consumers willing to pay a competitive price cannot obtain the product.

Under the ‘object’ rule, who bears the burden of showing efficiency benefits?

The parties to the agreement (they must invoke Section 5).

Give an example of a solidarity-based activity excluded from the Act.

Compulsory contributions to a mutual social-insurance fund.

Which EU case clarified that not every seemingly restrictive agreement is automatically a ‘by-object’ infringement?

Groupement des Cartes Bancaires (C-67/13 P).

What criterion distinguishes an ‘economic activity’ from a purely social activity for competition purposes?

Whether the activity involves offering goods or services on a market for remuneration.

Name one factor MyCC checks when deciding if a refusal to supply is abusive.

Whether the input is objectively necessary and cannot be reasonably duplicated by rivals.

Which Malaysian case involved discriminatory conditions imposed by an e-hailing platform?

MyCC v Grab Inc., GrabCar & MyTeksi (proposed decision).

Under Section 14-34, list two investigative powers of MyCC.

Compel documents or information, and conduct searches/seizures with a warrant.

What is the legal status of a CAT decision?

Final and binding, subject only to judicial review on procedural grounds.

When are maximum or ‘recommended’ resale prices potentially anti-competitive?

If they function as focal points that facilitate retailer collusion or are effectively enforced by the supplier.

How can a dominant producer lawfully justify different prices to different customers?

By demonstrating objective cost differences or efficiency reasons that are proportionate and non-exclusionary.

Which Section provides that conduct done solely to comply with another legislative requirement is excluded?

Second Schedule, Item 1 (Compliance with a legislative requirement).

In abuse cases, what is the ‘equally-efficient competitor’ test?

Assessment of whether the conduct would foreclose a competitor that is as efficient as the dominant firm.

Give one example of network effects creating barriers to entry.

A social-media platform becoming more valuable as more users join, making it hard for new entrants to attract users.

What is ‘up-front access payment’ in retail distribution and why can it be harmful?

Suppliers pay retailers for exclusive shelf space, which may foreclose rival brands from market access.

Explain ‘vertical tying’ with a simple example.

Printer manufacturer requires purchase of its ink cartridges to buy the printer.

Why are horizontal agreements usually scrutinised more harshly than vertical agreements?

Because they occur between direct competitors and typically have a more immediate potential to eliminate price competition.

What is bid suppression in a bid-rigging scheme?

Conspirators agree that only one will submit a bid while others refrain, ensuring a pre-selected winner.

Name one EU abuse case where the fine exceeded €1 billion.

Intel (2009) – €1.06 billion for loyalty rebates and foreclosure.

What does Section 16 of the Competition Commission Act empower MyCC to do regarding government laws?

Review, and advise the Minister on, laws or policies that restrict competition.