KUALA LUMPUR (Jan 28): In response to the allegation made by the Federation of Malaysian Consumers Association (Fomca) on Friday (Jan 27) in regard to putting an end to the monopolistic behaviour of Touch 'n Go Sdn Bhd and TNG Digital (TNG), the Malaysia Competition Commission (MyCC) said that the digital payment system did not raise any competition concerns under the Competition Act 2010.
In a statement released on Saturday, MyCC chairman Datuk Seri Mohd Hishamudin Yunus said that the commission is cognisant of issues raised by the public, including Fomca and other stakeholders, on this matter, and has been continuously monitoring the market in which TNG operates.
However, Hishamudin said that although TNG is a monopoly of the toll payment system, the issues raised against the company only relate to consumerism, which are not competition-related.
“The recent statement by Fomca is highly appreciated, and MyCC strives to embrace constructive comments that can help it to re-evaluate its role in promoting competition in the Malaysian economy, with reservations about misplaced allegations and perceptions,” said Hishamudin.
Nonetheless, Hishamudin said that MyCC had carried out some limited intervention, resulting in changes being implemented by TNG.
On Friday, Fomca secretary general and chief executive officer Datuk Dr Paul Selva Raj accused MyCC for failing to put an end to the monopolistic behaviour of TNG.
In response, Hishamudin said that there is a clear misconception imposed by Fomca on issues of monopolies. The commission said that the Competition Act 2010 clearly sets out that being a dominant or monopoly in a particular market is not an infringement of the law.
“However, a monopolistic or dominant enterprise infringes the Act when it abuses its position in the market.
“In this instance, MyCC recognises that TNG monopolises the toll payment system only. They became a monopoly naturally as soon as the government decided, via a gazette, to abolish cash payment for tolls nationwide, with the intention of reducing the congestion at toll booths for the convenience of highway users,” said Hishamudin.
The public’s frustration with products and services of TNG, including radio frequency identification (RFID), the TNG NFC card and TNG Visa card, has purportedly reached its peak. In this regard, MyCC had initiated several initiatives to step in and discuss with TNG some of the issues, said Hishamudin.
"As part of the recently formed task force by the current domestic trade and cost of living minister, MyCC together with the ministry had highlighted to TNG the confusion caused by TNG’s branding on the Visa card, when in fact the TNG Visa card cannot be used for toll payment and public transportation.
“In addition to that, TNG should practise a more effective communication method to ensure that consumers are well informed of this matter and all other matters associated with TNG, of which the public seem to be unaware of, including the incompatibility issue of the chip of a normal TNG card with the chip of its Visa card,” said Hishamudin.
He added that MyCC is aware that TNG had been unable to effectively address the public’s concern over the issue of scalpers selling TNG NFC cards at exorbitant prices.
“While MyCC appreciates that TNG has tried to fulfil demand for the NFC card in the face of a global shortage of the relevant chips, TNG should have taken more stern action against these scalpers that have caused losses to users who have had to pay higher prices to obtain and enjoy the features of the NFC cards,” he said.
Hishamudin added that MyCC had also advised TNG to be more transparent on the RM25 special-edition TNG NFC card in terms of its actual cost and amount of donation that will be forwarded to the targeted organisations, knowing that a normal TNG NFC card is being sold at RM10 and the shortage of the card in the market via TNG's channels.
According to him, the commission has been working since 2019 to further enhance its powers under the Act and the Competition Commission Act 2010 via amendments to both Acts, which are expected to be tabled in Parliament this year.
The amendments focus on the powers of MyCC to investigate and enforce the law, including the introduction of the merger control regime to prevent the formation of cartels and new monopolies.