Giga Shipping, Nexus Mega to stop any exclusivity clauses

PETALING JAYA: The Malaysia Competition Commission (MyCC) recently accepted undertakings in accordance with Section 43 of the Competition Act 2010 from Giga Shipping Sdn Bhd and Nexus Mega Carriers Sdn Bhd.

The undertakings are in relation to exclusive agreements between the two enterprises with vehicle manufacturers, distributors and retailers.

Both enterprises are major providers of logistic and shipment services by sea for motor vehicles from ports in Peninsular Malaysia to ports in Sabah, Sarawak and Labuan.

Following a complaint from a competitor, MyCC had been investigating suspected infringements of Sections 4(1) and 10(1) of the Act regarding the said exclusive agreements.

"The MyCC was concerned that these agreements may have had the effects of foreclosing customers to competitors of the enterprises, which if established, would have the effect of significantly preventing, restricting or distorting competition in the provision of the services," MyCC said in a statement yesterday.

Both enterprises have denied that their agreements with customers infringe the Act.

To address MyCC's competition concerns, the enterprises undertook to stop, including any exclusivity clauses or clauses in their agreements, which may distort, restrict or prevent the provision of services to their customers or potential customers.

"MyCC's intervention in this matter has ensured that competitors in the logistic and shipment services have access to customers while customers will also stand to gain from having more competing service providers to choose from," Domestic Trade, Co-operatives and Consumerism Minister Datuk Seri Hasan Malek was quoted as saying on the matter.

The undertakings accepted by the MyCC are legally binding on the enterprises and for so long as the enterprises are in compliance with the undertakings, the MyCC would refrain from instituting or taking proceedings against the enterprises.

The enterprises have also undertaken to continue implementing their competition law compliance programme initiated during the MyCC investigation for as long the undertakings are in effect.

The MyCC is satisfied that the undertakings provided by the enterprises address its competition concerns and has therefore closed its investigation on the matter.

The undertakings are available for public viewing on the MyCC website, www.mycc.gov.my.