MAS & Airasia infringed Competition Act, fined RM10 million each

The Malaysia Competition Commission (MyCC) has ruled that Malaysian Airline and AirAsia's 2011 collaboration agreement has violated the Competition Act 2010, and fined each company RM10 million.

In a statement today, MyCC Chairman, Tan Sri Siti Norma Yaakob, said the commission has found the airlines had infringed section 4(2)(b) of the Competition Act 2010 by entering into an agreement that has as its object the sharing of markets in the air transport services sector within Malaysia provided by both airlines.

"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.

"When businesses agree to share markets, they are agreeing to stop competing at the expense of the consumers," she said.

Siti Norma said the proposed financial penalties were less than 10 per cent of their respective worldwide turnovers between January and April last year.

"The financial penalties were adjusted based on mitigating factors taken into account by MyCC such as cooperativeness in providing data and information; and the voluntary action taken by the parties to remove the reference to routes and market focus stated in the airlines' collaboration agreement in their supplemental agreement dated May 2, 2012.

It said both parties will have 30 days from the date the proposed decision was served to submit written representations or indicate their wishes to make oral representations before the MyCC.