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Malaysia – Malaysian Airline And AirAsia 2011 Collaboration Agreement In Violation Of Competition Law.

9 December, 2013

 
 

On 6 September 2013, the Malaysia Competition Commission (“MyCC”) issued its proposed decision that Malaysian Airline System Berhad (“MAS”) and AirAsia Berhad’s (“AirAsia“) 2011 Comprehensive Collaboration Framework (“Collaboration Agreement”) had violated the Competition Act 2010 being an agreement that has as its object the sharing of markets in the air transport services sector within Malaysia, and proposed to fine each company RM 10 million. The fine amount is based on the turnover earned by the airlines between 1 January 2012 and 30 April 2012 on four specific domestic routes and which is less than 10% of their respective worldwide turnovers between January and April 2012. In deciding on the amount of the fines, the MyCC had also taken into account mitigating factors such as the parties’ cooperativeness in providing data and information, as well as the parties’ voluntary action to remove the reference to the routes and market focus under the Collaboration Agreement by a Supplemental Agreement dated 2 May 2012. If the proposed decision is confirmed, it will be the first infringement decision where the MyCC had imposed a fine. In 2012, the MyCC had found the Cameron Highlands Floriculturist Association guilty of price-fixing but had only imposed commitments on the association.

 

Both airlines had 30 days from the date of the proposed decision to submit written representations or indicate their wishes to make oral representations before the MyCC. At the time of writing, both AirAsia and MAS have submitted their written representations to the MyCC against the proposed decision within the specified time frame.

 

 

For further information, please contact:

 

Kuok Yew Chen, Partner, Christopher & Lee Ong
[email protected]

 

Yon See Ting, Partner, Christopher & Lee Ong
[email protected]


Corporate/M&A Law Firms in Malaysia

 

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