KUALA LUMPUR (Feb 12): Malayan Flour Mills Bhd’s (KL:MFLOUR) partly-owned Dindings Poultry Development Centre Sdn Bhd will seek a judicial review at the High Court after the Competition Appeal Tribunal (CAT) dismissed its appeal against a RM70 million fine by Malaysia Competition Commission (MyCC) for its involvement in a chicken feed cartel.
In a filing on Thursday, the group said Dindings Poultry, in consultation with its legal advisers, will also seek an interim stay order to temporarily suspend enforcement of the tribunal’s decision pending the court’s determination.
In Malaysia, a judicial review is when the High Court checks whether a decision by a public authority or tribunal is legal, fair, and reasonable. It does not re-examine the actual decision, only the way it was made.
Dindings Poultry is one of five feedmillers MyCC’s December 2023 ruling found to have colluded to fix poultry feed prices between January and June 2022. In total, the regulator imposed RM415.5 million in penalties, the largest penalty imposed by the competition regulator to date.
Four feedmillers — Dindings Poultry, Leong Hup Feedmill Malaysia Sdn Bhd, FFM Bhd and Gold Coin Feedmills (M) Sdn Bhd — fined RM367 million collectively, challenged the decision by MyCC.
PPB Group Bhd (KL:PPB) on Wednesday said its 80%-owned FFM is consulting with its external legal counsel on the appropriate actions to be taken to challenge the CAT’s decision.
In a statement on Wednesday, MyCC said the tribunal agreed with it in that the companies had coordinated price increases on chicken feed, a key input in poultry farming, during three periods between January 31, 2020, and June 30, 2022. Such coordination directly affects the cost of producing chicken and the prices consumers pay.
The tribunal confirmed that MyCC had correctly applied the Competition Act 2010, under which agreements between competitors to fix prices are automatically considered harmful to competition.
It found that the penalties imposed on the feedmillers were within the legal limit and appropriate, given the seriousness of the infringements.
MyCC said the tribunal also rejected the companies’ arguments that it had acted unfairly, without basis or in breach of due process, and, instead, confirmed that MyCC had conducted its investigation within its legal powers under the Competition Act 2010 and had complied with proper procedures throughout.
At the time of writing on Thursday, Malayan Flour Mills’ shares were down three sen or 4.65% to 61.5 sen, leaving the group with a market capitalisation of RM1.24 billion.