MyCC proposes to fine MyEG RM307,200

The Malaysia Competition Commission (MyCC) has proposed a financial penalty of RM307,200 on MyEG Services Bhd (MyEG), after it was found MyEG had abused its dominant position in the provision and management of online foreign workers' permit renewal applications, by selling mandatory insurance policies. In a statement today, MyCC said MyEG had infringed on the Competition Act 2010, after it was found that the company applied different conditions to equivalent transactions with other trading parties, to the extent that may harm competition. The commission started a probe into the private company earlier this year, following complaints filed by numerous parties. Its investigations found MyEG had harmed the level of competition in the selling of mandatory insurance policies (Foreign Workers Insurance Guarantee; Foreign Workers Hospitalisation and Surgical Scheme; and Foreign Workers Compensation Scheme) for its online permit renewal applications, as MyEG is also competing against other insurance companies in the market. MyCC also proposed to impose an additional penalty of RM15,000 for each day that MyEG fails to comply with two prescribed remedial actions, namely the termination of the existing agency agreements relating to the mandatory insurances — and not to enter into similar nature of agency agreements — and to provide an efficient gateway to all insurance companies selling the mandatory insurances which allow them to compete at the same level. MyCC has the legal right to impose a financial penalty of up to 10% of the worldwide turnover of each enterprise and any remedial action. The proposed decision is a written notice setting out the facts on which MyCC makes its assessment and its reasons for arriving at the proposed decision. It is issued to the enterprises concerned, to assist them in making representations and provide any other information to support their representations to MyCC, said the commission. The enterprises concerned have 30 days from the date of receipt of the proposed decision to make their representations, after which MyCC will make its final decision, after it considers the representations and available information and evidence. Meanwhile, MyEG, in a filing to the Bursa Malaysia, clarified that at this juncture, the proposed decisions are not final. “The management will review the proposed decisions with our external legal counsel, and will submit a written representation and will make an oral representation to MyCC within the specified period of time, to defend against the allegations made by MyCC,” it said. MyEG's shares closed 1 sen higher at RM2.81 today, with 1.55 million shares traded, giving it a market capitalisation of RM3.35 billion. – The Edge Markets, October 6, 2015.