Takeover and merger activities in Malaysia are governed by provisions contained in Division 2 Part VI of the Capital Markets and Services Act 2007 (CMSA 2007), which took effect on 1 April 2010. Along with this new Division 2 Part VI of the CMSA 2007, and on the recommendation of the Securities Commission Malaysia (SC), in order to accommodate the development of the capital market during the past 12 years, the Minister of Finance introduced the Malaysian Code on Take-Overs and Mergers 2010 (2010 Code) on 15 December 2010 to replace the Code on Take-overs and Mergers 1998.2 However, neither the CMSA 2007 nor the 2010 Code provide for a merger control regime in Malaysia.

The SC is the regulatory authority established to regulate takeovers and mergers of companies in accordance with the CMSA 2007 and the 2010 Code.3 In its administration of the 2010 Code, the SC may from time to time issue rulings pertaining to the interpretation of the 2010 Code, and on the practice and conduct of persons involved in or affected by a takeover offer, merger or compulsory acquisition. As such, the SC issued the Practice Notes on the 2010 Code to replace the practice notes that interpreted the 1998 Code. The SC has also issued the Guidelines on Contents of Applications relating to Take-overs and Mergers to facilitate the submission of applications to the SC pursuant to the CMSA 2007 and the 2010 Code.4

Essentially, the review of a proposed merger by the SC focuses merely on the compliance with the provisions of the takeover laws and regulations in Malaysia under the CMSA 2007 and the 2010 Code.

The Malaysian Competition Act 2010 (CA 2010) was introduced following the Prime Minister’s unveiling of the new economic model in March 2010, which aims to double Malaysia’s per capita income by 2020 by transforming the Malaysian economy through eight strategic reform initiatives, including a programme of liberalisation and deregulation to promote a competitive domestic economy.

The CA 2010, which came into effect on 1 January 2012, applies to all commercial activities undertaken within Malaysia and those outside of Malaysia that have an effect on competition in the Malaysian market, save for commercial activity regulated under the Communications and Multimedia Commission Act 1998, the Energy Commission Act 2001, the Petroleum Development Act 1974 as well as the Petroleum Regulations 1974 (insofar as the commercial activities regulated under these pieces of legislation are directly in connection with upstream operations comprising the activities of exploring, exploiting, winning and obtaining petroleum, whether onshore or offshore Malaysia) and the Malaysian Aviation Commission Act 2015 (MACA 2015).

Competition law plays an important part in the context of merger deals and transactions as it attempts to bring about the benefits of competition by tackling barriers to entry in the form of cartels, abuse of a dominant position and anticompetitive mergers. Most countries have incorporated a merger control regime in the context of competition law, and the competition commission will be entrusted with the role of administering merger control. However, contrary to other jurisdictions and as a latecomer to competition law, Malaysia implemented the CA 2010 with no express provisions for merger control provisions. The CA 2010 focuses purely on anticompetitive agreements and abuses of dominant position.

The Malaysia Competition Commission (MyCC) was established as an independent body to enforce the CA 2010.5 It falls within the ambit of the Ministry of Domestic Trade, Co-Operatives and Consumerism and is chaired by the former Chief Judge of Malaya, Tan Sri Dato’ Seri Siti Norma Yaakob. The MyCC is made up of 10 people and is currently supported by an executive arm of seven officers. The main role of the MyCC is to protect the competitive process for the benefit of businesses, consumers and the economy.

Having said the above, attention should be given to the newly enacted MACA 2015, which serves as the first sectoral legislation to contain merger control provisions from the competition perspective in the aviation service market in Malaysia. The Malaysian Aviation Commission (MAC), which was recently established by the MACA 2015, has taken over regulation of competition and economic issues relating to the aviation industry. In terms of competition regulation, in addition to its powers to regulate anticompetitive agreements and abuse of dominant positions, similar to the MyCC, the MAC has powers over merger control in the civil aviation industry. The MAC’s competition powers extend to commercial activities or transactions that occur both within and outside Malaysia so long as they have an effect on competition in the aviation service market in Malaysia.

Despite the absence of generic merger control provisions applicable to all industries, as well as mandatory or optional reporting or filing to the MyCC for a clearance decision on any merger transaction, the MyCC has publicly stated that this does not prevent the MyCC from investigating collaborative activities arising from mergers, and to determine whether such activities are anticompetitive.

Nonetheless, merger parties are expected or encouraged to undertake self-assessments of their business conduct, procedures, management and control systems to ensure that a proposed merger is in compliance with the CA 2010. The MyCC has expressly stated that it will not entertain any application for guidance or pre-consultation on the possible anticompetitive effects of a merger transaction. Accordingly, parties who intend to undertake a merger will have to bear the antitrust risk. This is an evergreen risk, as the transaction is subject to the possibility of an investigation by the MyCC at any time.


In view of the fact that there is no general provision for merger control review in Malaysia, merger deals sealed in Malaysia have not been scrutinised by any authorities in the context of competition or antitrust law. The merger regime is not a feature of the current CA 2010. However, MACA 2015 marks the first attempt to introduce merger control from the competition perspective into Malaysia’s aviation industry.

Based on analysis by Thomson Financial, Institute of Mergers, Acquisition and Alliances, the deal volume of the merger and acquisition market in Malaysia dropped to US$14 billion in 2015 from US$41 billion in 2014, with an approximate total of 1,200 deals in both years.6 In 2015, the SC considered 79 submissions under the 2010 Code, and approved three applications for reverse takeovers and restructurings in the same year.7 In the first quarter of 2016, the SC considered 11 submissions under the 2010 Code, and one application for acquisition/reverse takeovers and restructurings was approved.8 The only types of submission to the SC consist of clearance of offer documents, exemptions from mandatory offer obligations, clearance of independent advice circulars, eligibility to act as independent adviser for takeover proposals, extension of time, rulings, ancillary applications and other related decisions. None of these submissions are in relation to a merger control review.

A number of notable deals were successfully clinched in the active Malaysian market recently.

In early 2013, Malaysian Resources Corp Bhd sealed a cash and share swap deal worth 729 million ringgit with Gapurna Sdn Bhd. Under this deal, Gapurna Sdn Bhd will gain a 16.8 per cent equity stake in Malaysian Resources Corp Bhd, and Gapurna Sdn Bhd’s Chief Executive Officer will be appointed as the new managing director of Malaysian Resources Corp Bhd.

Another deal where the parties opted for a share swap instead of merger was the share swap between Tune Air Sdn Bhd and Khazanah Nasional Berhad, which is the largest shareholder of Malaysia Airlines, in the third quarter of 2011. In this share exchange arrangement, the state investment arm, Khazanah Nasional Berhad, took a 10 per cent stake in the leading low-cost courier AirAsia, while Tune Air Sdn Bhd, the investment vehicle of AirAsia, took a 20.5 per cent stake in Malaysia Airlines.

However, due to a lack of support from shareholders, the two companies agreed to call off the cross-holding of shares and to revert to the original major shareholding structure of both companies after only eight months, as this controversial share swap, which was crafted for the benefit of the country’s aviation industry, had failed to revive Malaysia Airlines. Nevertheless, after the termination of this share swap, the collaboration pact between these two airlines is not entirely determined; the parties have entered into supplementary agreements to jointly explore and set up a special purpose vehicle for procurement and joint venture companies to provide aircraft component maintenance support as well as repair services with the aim of saving costs.

Malaysia saw an increase in the merger and acquisition deal activities in the second half of 2015, with energy accounting for the largest sector in value terms followed by real estate and industrial.

The largest energy deal in 2015 was the acquisition of Edra Global Energy Bhd (Edra) by China General Nuclear Power Corp (CGN), the world’s leading clean energy company, valued at US$2.3 billion. Following this acquisition, CGN became the largest independent power producer in South Korea, Egypt and Bangladesh. CGN has committed to strengthen its cooperation with the local supply chain, taking into account local requirements and contributions to Malaysia’s economy. With Malaysia being a notable diversified emerging industrial country in Asia and an emerging economy in the world, CGN is optimistic about the future development of power supply in Malaysia. This has also spurred CGN to set up its South East Asia regional headquarters in Kuala Lumpur.

Another major deal was the acquisition of Perdana Petroleum Bhd by Dayang Enterprise Holdings Bhd (Dayang) for US$338.6 million. Dayang was reported as saying that this acquisition presented an opportunity to pursue its expansion strategy and long-term objective of evolving into a market leader for the provision of hook-up construction and commissioning service in the oil and gas industry.

One of the major deals in real estate is the acquisition of the entire stake in Mayang Development Sdn Bhd and Nusa Properties Sdn Bhd by IOI Properties Group Berhad (IOI Properties) for 1.583 billion ringgit. Through these acquisitions, IOI Properties’ landbank would be enlarged to 181.99 hectares from its existing 20.23 hectares. This enlarged landbank is expected to generate an indicative gross development value of approximately 20 billion ringgit.

Other notable deals that were successfully clinched in the active Malaysian market recently are as follows.

Sime Darby Bhd, the world’s top oil palm planter by land size, has acquired all the shares in New Britain Palm Oil Ltd, a company listed in London Stock Exchange and Papua New Guinea, at an approximate consideration of US$1.74 billion. This acquisition added another 135,000 hectares of land in Papua New Guinea, bringing Sime Darby Bhd’s total land bank to almost 1 million hectares spread across five countries. As a result of this acquisition, New Britain Palm Oil Ltd was delisted from the London Stock Exchange effective 25 March 2015.

In September 2015, Avantha Group-controlled Ballarpur Industries Ltd (BILT) announced the sale of its indirectly owned subsidiary in Malaysia, Sabah Forest Industries Sdn Bhd (SFI) for an enterprise value of US$500 million to Pandawa Sakti (Sabah) Sdn Bhd (PSSB). A 98.08 per cent equity stake in SFI is owned by Ballarpur Paper Holdings BV, a Netherlands-based investment firm in which BILT owns a 69 per cent equity stake. It was reported that PSSB and its strategic partner in China proposed establishing a pulp mill with an annual capacity of more than 1 million tonnes for the manufacture and sale of wood pulp to other countries. The Chairman of the Avantha Group was quoted saying the divestiture of SFI is aligned with BILT’s objectives, given the prevailing market conditions, and the company’s strategy of divesting assets at the right prices to maintain a healthy balance sheet.

IHH Healthcare Bhd (IHH) has, through its indirectly wholly owned subsidiary, Gleneagles Development Pte Ltd, acquired 73.4 per cent of the equity interest in Global Hospitals (Global) for 12.84 billion indian rupee. Global, which was founded in 1999, is one of the largest healthcare providers in India, with presence in cities such as Mumbai, Bengaluru, Chennai and Hyderabad. This acquisition has been viewed positively as it offers IHH a solid platform for further growth in India and will help fortify IHH’s presence in the India market.

Diversified group MMC Corp Bhd has, through its wholly owned subsidiary, MMC Port Holdings Sdn Bhd, acquired all the remaining 92.58 per cent of the total issued and paid-up capital of port operator NCB Holdings Bhd for a cash offer price of 1.9 billion ringgit. MMC Corp Bhd, which owns, among other things, Northport, Johor Port and Penang Port, is reported to be in the midst of consolidating all its ports businesses to become one of the largest port operators in Asia.

Tenaga Nasional Bhd (TNB) concluded the acquisition of a 30 per cent stake in GAMA Enerji AS (GAMA) for US$255 million in April 2016. GAMA is a unit of GAMA Holding, one of the most prominent conglomerates in Turkey with activities in construction, energy performance contracting, concessions, trade and energy/water investment. The TNB president and chief executive officer was reported as saying that this US$255 million deal seals TNB’s first foray into Turkey’s growing energy sector.

Although there have recently been various merger transactions, as mentioned above, the only transaction that triggered an investigation by the MyCC was the share swap deal between Malaysia Airlines and AirAsia – and that was not even a merger transaction.

The MyCC acted on its own accord to initiate this investigation in early 2012 due to public outcry over the collaboration arrangement. A letter of complaint was also received by the MyCC on 24 February 2012 from the Federation of Malaysian Consumers Association. It is believed that one reason behind the investigation was the amount of public interest in this share swap deal between two leading airlines in Malaysia, as evidenced by the concerns raised by Parliament, trade unions and the Malaysian public. The MyCC’s investigation focused on whether the deal involves an abuse of monopoly or the formation of a cartel in the country’s aviation industry.

On 31 March 2014, the MyCC announced that both Malaysia Airlines and AirAsia have infringed Section 4(2)(b) of the CA 2010 by entering into a collaboration arrangement that has the clear objective of sharing the market in relation to aviation services. The MyCC is satisfied that the collaboration arrangement allows both Malaysia Airlines and AirAsia to operate freely within separate market segments, and provides both airlines the freedom to impose higher prices to maximise their commercial revenue and profitability without any competition. Accordingly, the MyCC imposed a financial penalty of 10 million ringgit on Malaysia Airlines and AirAsia respectively. Following the decision, both airlines have appealed to the Competition Appeal Tribunal. On 18 February 2016, the five members of the Competition Appeal Tribunal, chaired by High Court Justice Hasnah Mohamed Hashim, made a unanimous decision that the MyCC has misinterpreted the collaboration arrangement and failed to show there was a market-sharing objective. Accordingly, it was held that both airlines do not infringe Section 4(2) of the CA 2010 and the decision by the MyCC dated 31 March 2014 was set aside, and the financial penalty, if paid, is to be refunded. This is the first decision by the Competition Appeal Tribunal since its inception more than four years ago.

The notable acquisition by Australia’s SeekAsia Ltd (SEEK) of the entire online employment businesses of Malaysia-based job portal JobStreet Corporation Bhd (JobStreet), one of the largest online employment companies in the South-East Asia region, at a purchase price of 1.89 billion ringgit. However, this deal was subject to regulatory approval in Singapore and the approval of JobStreet’s shareholders, but not the MyCC’s purview. The Competition Commission of Singapore (CCS) found that this acquisition, which includes the acquisition of JobStreet.com Pte Ltd (JobStreet Singapore), will substantially lessen competition in the market for online recruitment advertising services in Singapore as it brings together the top two online recruitment advertising service providers in Singapore, JobsDB.com.sg (being SEEK’s platform) and JobsStreet.com.sg (being JobStreet’s platform). Nonetheless, the CCS, in November 2014, granted approval of the merger conditioned upon the implementation of and compliance with the behavioural and divesture commitments offered by SEEK and accepted by the CCS after conducting market consultations.

According to the then Chief Executive Officer of the MyCC, Shila Dorai Raj, the fact that the MyCC ‘is not empowered to examine mergers and acquisitions’ does not prevent it from checking the collaborative activities arising after mergers and whether those activities are anticompetitive. As of August 2015, it was reported that the MyCC has investigated 53 cases, with 29 still ongoing.

The then Minister of Domestic Trade, Cooperatives and Consumerism, Datuk Seri Ismail Sabri Yaakub, offered an assurance that there will be no influence by any parties, including the government, on any investigation or decision made by the MyCC, as the MyCC is an independent body.


Save for MACA 2015, there are no express and comprehensive rules and regulations on merger control in Malaysia. Parties who wish to undertake a merger in a non-aviation industry should nevertheless comply with the provisions in the CA 2010.

Section 4 of the CA 2010 prohibits anticompetitive agreements, while Section 10 prohibits the abuse of a dominant position. The MyCC is empowered to probe and enforce the general anticompetitive provisions of the CA 2010, which means that the MyCC may conduct market reviews or an investigation whenever it is of a view that a merger may lead to a monopoly or abuse of power.

In moving the Bill, the then Minister for Domestic Trade, Co-operatives and Consumerism, Datuk Seri Ismail Sabri Yaakub, outlined that:

This Bill does not contain substantive provisions regulating the control over merger and acquisition activities. This was decided upon after taking into account input from agencies, such as the Securities Commission Malaysia and the Central Bank of Malaysia, in encouraging the development of capital markets in Malaysia. This is also in line with the national policy of encouraging mergers and acquisitions among businesses in order to strengthen the domestic economy and to advance global corporate competitiveness. This should not be a major concern at the moment as our studies show that countries such as the European Union only introduced merger and acquisition control thirty years after their competition law was first enacted. Likewise, Indonesia only did so ten years afterward and Singapore, three years afterward.9

In short, the decision not to regulate control over mergers and acquisitions in light of the CA 2010 was motivated partly by the government’s policy of encouraging mergers to strengthen the domestic economy and develop global competition.

Perhaps it can be inferred that this is one of the government’s means of protecting or assisting local firms to compete with more established foreign firms, particularly in sectors perceived as being ‘too big to be allowed to fail’, such as Malaysia Airlines, which the government has repeatedly rescued using national funds. This in itself is an ominous indicator of the tradition of interventionist government industrial policy, which entrenches the expectation that the government will be on hand to make up for the shortcomings of major domestic corporations.

The absence of merger regulations was then justified as follows: ‘Although this Bill does not restrict mergers and takeovers, we will regulate what happens after the merger or acquisition to ensure that if there is monopoly power arising, it is not abused by the company concerned.’10

From the above, it is clear that the CA 2010 does not serve as a pre-emptive measure against the possible abuse of competition.

It has been suggested that, in the absence of an express merger control regime then, the MyCC or any affected party could challenge a proposed merger on the basis that it is a horizontal or vertical agreement that has ‘the effect of significantly preventing, restricting or distorting competition’ under Section 4 of the CA 2010.11 It should then be possible to trigger the MyCC’s power to give any direction it deems appropriate, including halting the merger.12

Nonetheless, the MyCC may grant ‘relief of liability’ in the form of an individual exemption for the infringement of anticompetitive agreement prohibition13 if, in the opinion of the MyCC:

  • a there are significant identifiable technological, efficiency or social benefits directly arising from the agreement;
  • b the benefits could not reasonably have been provided by the parties to the agreement without the agreement having the effect of preventing, restricting or distorting competition;
  • c the detrimental effect of the agreement on competition is proportionate to the benefits provided; and
  • d the agreement does not allow the enterprise concerned to eliminate competition completely in respect of a substantial part of the goods or services.14

The onus of proving these conditions conjunctively for the relief of liability lies on the parties undertaking the anticompetitive merger.

For instance, Nestlé Sdn Bhd applied to the MyCC for an individual exemption to exclude its pricing policy, called the Brand Equity Protection Policy, from the infringement definition of the CA 2010. However, after a series of discussions with the MyCC, Nestlé withdrew its application. The major concern of the MyCC was the element of resale price maintenance, which prevents resellers from setting their prices independently, and which could potentially lead to increased prices for consumers. Therefore, as requested by the MyCC, Nestlé agreed to comply in dismantling the said pricing policy and issued notices to the trade on the same.

Alternatively, a proposed merger could also be challenged under Section 10 of the CA 2010 if the merged entity abuses its dominant position. Contrary to the outright legislative prohibition on anticompetitive mergers, the main difficulty in this approach is that the party opposing the merger would have to prove the anticompetitive effects instead of the enterprises having to justify the merger.

Pursuant to the CA 2010, there are three ways in which an investigation can be initiated by the MyCC: on the MyCC’s own initiative, on the direction of the Minister15 or following a complaint by any affected party.16 Hence, any person or enterprise who believes that an enterprise is engaging in an anticompetitive merger may lodge a complaint to the MyCC to investigate whether such merger infringes the CA 2010.

It is also noteworthy that the MyCC Guidelines on Complaint Procedures are not exhaustive and do not set a limit on the investigation and enforcement activities of the MyCC. The CA 2010 confers extensive investigation powers on the MyCC, as it provides the officers of the MyCC investigating any offence under the CA 2010 with all or any of the powers of a police officer in relation to police investigations in seizable cases as provided for under the Criminal Procedure Code.17

The Competition Appeal Tribunal was established pursuant to the CA 201018 as a specialised court to hear appeals against a decision made by the MyCC, whether it is a direction, finding of non-infringement or decision of infringement. Any enterprise or person whose interest is directly or indirectly affected by any decision made by the MyCC can file a notice of appeal with the Competition Appeal Tribunal, whose decision shall be ‘final and binding on the parties to the appeal’.19 An appeal must be filed within 30 days from the date of such decision.20

Pending the appeal, the MyCC’s decision will still be binding and enforceable until and unless the Competition Appeal Tribunal grants a stay of the decision.21 On appeal, the Competition Appeal Tribunal may confirm, vary or set aside decisions of the MyCC, remit the matter to the MyCC for further consideration or make any other decisions that the MyCC itself could have made.22 A decision made by the Competition Appeal Tribunal may, with the leave of the High Court, be enforced in the same manner as a judgment or order to the same effect.23 The decision by the Competition Appeal Tribunal is final and binding on the parties to the appeal.24

The CA 2010 also allows an enterprise or person whose interests are directly or indirectly affected by the enterprises that have engaged in the prohibited anticompetitive practices to take private action in a court of law.25

With the recent enactment of MACA 2015, merger control has been introduced over the aviation service market in Malaysia. The Competition Appeal Tribunal’s decision in setting aside the 10 million ringgit fine imposed on the country’s two major carriers, Malaysia Airlines and AirAsia, will arguably provide some guidance to the MAC, which has taken over the power to regulate economic matters relating to the aviation industry. Although it has introduced a voluntary merger regime specific to the aviation industry, it remains unclear whether MACA 2015 will serve as the basis for the introduction of a generic type of merger control applicable to all industries.


The CA 2010 does not follow its European ancestors. In Malaysia, any commercial activity that has an effect on competition in any market in Malaysia, regardless of where the anticompetition action is implemented, will come under the purview of the CA 2010. This is similar to the approach taken by the United States, which adopts the ‘effect’ doctrine in its competition law regime. This ‘effect’ doctrine captures any behaviour that has an effect on the market.

On the other hand, the EU adopts the ‘implementation’ doctrine, which holds that the EU has jurisdiction if the anticompetitive action is implemented within the EU. In such instance, an enterprise will be subjected to the EU competition law regime as long as the anticompetition action takes place within the EU market.

Therefore, it seems clear that a Malaysian enterprise can be subject to foreign competition regimes, while a foreign enterprise can also be subject to the CA 2010.

Despite having stated in its guidelines that relevant economic markets can extend to beyond a single country, the MyCC does not clarify further on how it will consider and deal with these foreign competitors, or explain the requisite standard of effect the behaviour of these foreign competitors must have on a market in Malaysia.

Notwithstanding the lack of a generic merger control regime in Malaysia, perhaps it is comforting to note that the SC is obliged under the 2010 Code to take into account ‘the desirability of ensuring that the acquisition of voting shares or control of companies takes place in an efficient, competitive and informed market’ while administering the Code and exercising its powers under the CMSA 2007.26 It is arguable, therefore, that the SC may possibly go one step beyond to scrutinise the anticompetitive effect in addition to reviewing a proposed merger solely in the context of compliance with the 2010 Code and the CMSA 2007. However, whether the SC will adopt such radical approach remains to be seen.

In addition, it remains unclear whether the recent introduction of MACA 2015 will serve as the basis for a generic type of merger control applicable to all industries in Malaysia.


As Malaysian companies are looking to expand into other parts of Asia and make their mark on the world stage, we expect to see merger and acquisition activities in Malaysia continuing to rise. While Malaysian companies will still acquire other local companies to power their expansion plans, acquisitions outside of Malaysia have become a more attractive growth route for many to enhance their regional or even global standing.

The establishment of the ASEAN Economic Community (AEC)27 in 2015 is said to be a major milestone in the regional economic integration agenda in ASEAN, offering opportunities in the form of a huge market of US$2.6 trillion and over 622 million people. Essentially, the formation of the AEC encourages greater connectivity and sectoral cooperation, which will see more companies making cross-border, strategic economic ventures.

Zurich Insurance Co Ltd is set to acquire MAA Group Bhd’s 75 per cent-owned subsidiary, MAA Takaful Bhd, for 393.75 million ringgit cash. This acquisition has been approved by the Minister of Finance but remains subject to the approval of MAA Group Bhd’s shareholders. With this potential acquisition, it is reported that MAA Group Bhd is confident that, with its international expertise and global brand combined with the local Takaful talent, MAA Takaful Bhd will scale greater heights and this will benefit all its certificate holders.

Merger laws are a very important determinant of merger activities, but merger regulation per se does not have an effect on merger activities. Nonetheless, one study shows that the better the quality of the law (as measured by the severity of the penalties and the notification requirements imposed on the parties), the higher the frequency of cross-border acquisitions of domestic firms, and the higher the frequency of domestic acquisitions by domestic firms.28

Therefore, sound merger regulations and enforcement must be observed to promote competition by establishing controls in the merger process, and to put limits on the concentration of economic powers that will result in market dominance.

To date, there is no news regarding the incorporation of a merger control regime in the Malaysian competition law context, save for the subtle incorporation of merger control in the MACA 2015.

Nonetheless, in view of the agreement reached between ASEAN leaders in 2007 on the establishment of the ASEAN Economic Community, which occurred in 2015, the ASEAN Regional Guidelines on Competition Policy, 2010 (Guidelines) have been completed by the ASEAN Experts Group on Competition. These Guidelines aim to ensure that ASEAN is a highly competitive economic region as envisaged in the ASEAN Economic Community Blueprint, in particular through the introduction of a nationwide competition policy and law by 2015.

Pursuant to Chapter 3 of the Guidelines, the coverage of the nationwide competition policy may include a prohibition on anticompetitive (horizontal and vertical) agreements, abuse of dominant position (market power), anticompetitive mergers and other restrictive trade practices.29

Therefore, should the government intend to implement a comprehensive regulation of the marketplace in the interest of consumers and business that is in line with the competition policy of the ASEAN Economic Community, the adoption of a merger control regime in the CA 2010 is inevitable in the near future.

Meanwhile, the enforcement of CA 2010 and the administration of the MyCC should also be scrutinised. The then Chief Executive Officer of the MyCC has also announced that the MyCC will no longer adopt a soft approach to enforcement.

However, the MyCC’s focus has been on small to medium-sized enterprises, pharmaceuticals, professional bodies and bid-rigging issues. The then Chief Executive Officer of the MyCC has declared that one of the principle aims of the MyCC is to create a culture of compliance by raising awareness of the benefits the law can bring. As such, it is disappointing to note that there is no indication that the MyCC will focus on investigating the anticompetitive effect of merger and acquisition transactions in the competition law context this year. Due to this, it is hard to envisage a competitive domestic economy in Malaysia will be achieved in the short term.

Having only recently implemented the MACA 2015 and the CA 2010, competition law and policy in Malaysia remain in relative infancy. The impact of both the MACA 2015 and the CA 2010 is still subject to speculation and the scrutiny of many, including public and private sector enterprises, professional advisers and even consumers. It can only be a matter of time before the breadth and depth of the MACA 2015 and the CA 2010 will be tested, and we await such development with interest.


1 Jeff Leong is a senior partner at Jeff Leong, Poon & Wong.

2 Section 217(1) of the CMSA 2007.

3 Section 15(1)(d) of the Securities Commission Act 1993 empowers the SC to regulate the takeovers and mergers of companies; Section 220 of the CMSA 2007 empowers the SC to take actions in cases of non-compliance with the 2010 Code.

4 Section 377 of the CMSA 2007.

5 Section 3 of the Competition Commission Act 2010.

6 M&A Statistics – Worldwide, Regions, Industries & Countries, Institute of Mergers, Acquisitions and Alliances analysis.

7 Capital Market Statistics, SC Scorecard & Statistics of Submissions Approved by the SC in Q1-Q4, 2015.

8 Capital Market Statistics, SC Scorecard & Statistics of Submissions Approved by the SC in Q1, 2016.

9 Hansard records of the House of Representatives, 20 April 2010, p. 129 (translated from Malay language).

10 Id, p. 149.

11 Professor Ian McEwin, managing partner of Competition Consulting Asia LLP.

12 Section 40 of the CA 2010.

13 Section 6 of the CA 2010.

14 Section 5 of the CA 2010.

15 Section 14 of the CA 2010.

16 Section 15 of the CA 2010.

17 Section 17(2) of the CA 2010.

18 Section 44 of the CA 2010.

19 Section 51 of the CA 2010.

20 Section 51(2) of the CA 2010; and the MyCC’s ‘Competition Act 2010 – Handbook for the General Public’, July 2012.

21 Section 53(1) of the CA 2010.

22 Section 58(2) of the CA 2010.

23 Section 59 of the CA 2010.

24 Section 58(3) CA 2010.

25 Section 64 of the CA 2010.

26 Section 217(4) of the CMSA 2007.

27 The ASEAN Economic Community will not only transform ASEAN into a region with free movement of goods, services, investment and skilled labour as well as a freer flow of capital, but also into a highly competitive region that is fully integrated with the global economy.

28 ‘The Effect of Merger Laws on Merger Activity: International Evidence’, Professor Arturo Bris, Associate Professor Christos Cabolis and Vanessa Janowski.

29 The Guidelines, Chapter 3: Scope of Competition Policy and Law.