This article first appeared in The Edge Financial Daily, on April 19, 2016.

KUALA LUMPUR: The Malaysia Competition Commission (MyCC) has cleared Megasteel Sdn Bhd, the country’s largest hot rolled coil (HRC) producer, of having allegedly infringed the Competition Act 2010.

“After deliberating on the written and oral representations submitted by Megasteel, the MyCC has conducted further analysis and come to the conclusion that Megasteel neither abused its dominant position nor practiced margin squeeze in the relevant markets,” the antitrust watchdog said in a statement yesterday.

“The MyCC therefore finds that there is no infringement of the Competition Act 2010 by Megasteel,” it added.

MyCC said it had initiated an investigation in October 2012 upon receiving a complaint relating to Megasteel’s alleged abuse of its dominant position, which is an infringement of Section 10(1) of the Competition Act 2010.

The complainant had alleged that Megasteel had charged higher prices for its products than the market price of HRC, which is an essential material to produce cold rolled coil (CRC).

The complainant had also alleged that Megasteel is competing in the CRC market and often undercuts its price.

Last Friday, Lion Corp Bhd announced to Bursa Malaysia that its 78.89%-owned subsidiary Megasteel had been cleared of anticompetition allegations.

In November last year, the antitrust watchdog issued its proposed decision that Megasteel had breached Section 10(1) of the Act, in that the latter had abused its dominant position by charging or imposing a price for its HRC that amounted to a margin squeeze. This had produced anticompetitive effects in the CRC market.

Under the proposed decision, a financial penalty of RM4.5 million was to be imposed by MyCC on Megasteel.