KUALA LUMPUR, June 21 (Bernama) -- The Malaysia Competition Commission (MyCC) has decided to grant a block exemption for liner shipping agreements in respect of Vessel Sharing Agreements (VSA) and Voluntary Discussion Agreements (VDA) made within Malaysia or which have an effect on liner shipping services in Malaysia subject to the condition that no element of price fixing, price recommendation or tariff imposition by any person on transport users.
 
The Block Exemption Order (BEO) shall commence on 7 July 2017 for a period of two years or until the same is cancelled by the MyCC. The decision was made upon consideration of the feedback from public, stakeholders of the industry and relevant government ministries over the past 30 days starting from 11 May 2017.
 
In 2014, the MyCC had granted a three year block exemption for liner shipping agreements which is due to expire on 6 July 2017. The application for the renewal of block exemption for VSA and VDA in respect of liner shipping services was submitted by the Malaysia Shipowners Association (MASA) and the Shipping Association of Malaysia (SAM) on 6 March 2017. 
 
The MyCC in the exercise of the powers conferred by subsection 8(1) of the Competition Act 2010 (“the Act) may grant a block exemption provided all the conditions under section 5 of the Act are satisfied cumulatively:  

(a) There are significant identifiable efficiency benefits arising from the liner shipping agreements;
(b) The benefits could not reasonably have been provided by the parties to the liner shipping agreement without the agreement having the effect of preventing, restricting or distorting competition;
(c) The detrimental effect of the liner shipping agreements on competition is proportionate to the benefits provided; and 
(d) The liner shipping agreement does not allow liner operators to eliminate competition completely in respect of a substantial part of the liner shipping services.
 
The BEO does not exempt or provide immunity in respect of any abuse of a dominant position under the section 10 of the Act. Therefore, parties to a liner shipping agreement can still be found liable for an infringement if they are found abusing their dominant positions in the liner shipping market. 
 
The BEO does not cover inland carriage of goods and warehousing of goods. In addition, the BEO allows liner shipping operators to offer, on the basis of individual confidential contracting, their own service arrangements, upon certain conditions (refer to Annexe A for more details). 

Click here for the Annexe A

About Malaysia Competition Commission (MyCC) 

Established in June 2011, MyCC is an independent body responsible for enforcing the Competition Act 2010, which was implemented to create healthy competition which would in turn stimulate productivity and innovation, thus creating wider choices of products for consumers with better quality and reasonable prices.
 
The Act applies to all commercial activities undertaken within and outside Malaysia that affect competition in the Malaysian market. It provides a regulatory framework including powers to investigate, adjudicate and impose penalties on the perpetrators of the competition laws. For more information on the Act and the MyCC’sactivities, log on to www.mycc.gov.my

Source : Malaysia Competition Commission (MyCC)

FOR MORE INFORMATION, PLEASE CONTACT:
Corporate Affairs Division 
Malaysia Competition Commission
Tel : +603 2273 2277  

--BERNAMA