[UPDATED] Five companies likely guilty of anti-competition conduct: MyCC

KUALA LUMPUR – Five companies are potentially guilty of violating competitive conduct in the chicken and egg industry, said the Malaysia Competition Commission (MyCC).

MyCC chief executive Iskandar Ismail said the businesses involved appear to have gone against Section 4 of the Competition Act 2010. 

The five companies are Dindings Poultry Development Centre Sdn Bhd, FFM Berhad, Gold Coin Feedmills (Malaysia) Sdn Bhd, Leong Hup Feedmill Malaysia Sdn Bhd and PK Agro-Industrial Products (M) Sdn Bhd. 

“Between early 2020 and the middle of this year, the companies entered into an anti-competition agreement and/or concentrated practice to raise the quantum price of chicken feed containing soybean and corn as its main ingredient,” Iskandar told reporters at a press conference here today. 

As reported by Getaran, The Vibes’ sister portal, he added that investigations revealed that confidential trade information was shared between the companies, potentially disrupting market competition. 

However, he said that since the findings are based on preliminary investigations, it cannot yet be assumed that the companies are breaking the law, noting that the named companies have 30 days to submit their representations after the proposed decision was delivered to them. 

“After hearing and considering their representation, along with evidence collected throughout probes, MyCC will issue a final decision on whether or not there was misconduct against the Competition Act 2010. 

“If there are violations, MyCC can impose a financial penalty of up to 10% of the enterprise’s global turnover during the period of the violation or issue instructions it deems appropriate.” 

He said a notice letter has already been delivered to the five companies earlier today, while a final verdict is expected to be obtained in October. 

He also explained that similar price hikes among businesses were caused by the companies setting identical prices for the same amount of goods, leading to limited choices for buyers looking for a chicken feed supplier. 

“These actions might potentially create an anti-competitive landscape in the supply chain of the chicken industry,” he said, noting that at about 72.8% of total costs, chicken feed is the main contributor to the upwards price of livestock.

As such, he said when competition is manipulated in the chicken feed market, the industry’s entire supply chain will be affected, with consumers suffering the brunt of conditions. 

In February, MyCC had set up a special team to investigate allegations of anti-competitive conduct, including anti-competitive agreements and/or abuse of dominant positions in the market that could cause an increase in the prices of goods. – The Vibes, August 5, 2022