KUALA LUMPUR: The Malaysia Competition Commission (MyCC), which ensures healthy competition in the Malaysian market, has ruled in its proposed decision that Malaysian Airline and AirAsia’s 2011 collaboration agreement violated the Competition Act 2010, and fined each company RM10mil.
“The MyCC has found both airlines have infringed section 4(2)(b) of the Competition Act by entering into an agreement that has as its objective the sharing of markets in the air transport services sector within Malaysia provided by both airlines,” the MyCC said in its press statement on Friday.
“Market sharing is considered a serious infringement under the act as it is deemed to have the object of significantly preventing, restricting, or distorting competition in any market for goods and services,” MyCC chairman, Tan Sri Siti Norma Yaakob.
“When businesses agree to share markets, they are agreeing to stop competing at the expense of the consumers,” she stressed.
According to the commission’s proposed decision, the financial penalties imposed on both MAS and AirAsia was on the basis of turnover earned between Jan 1, 2012 and Apr 30, 2012 from the following routes: KL-Kuching, KL-Kota Kinabalu, KL-Sandakan, and KL-Sibu.
It said both parties have 30 days from the date the proposed decision is served to submit written representations or indicate their wishes to make oral representations before the MyCC.