Jan 27, 2023 11:38 AM
The Federation of Malaysian Consumers Association (Fomca) fully supports Domestic Trade and Cost of Living Minister Salahuddin Ayub for finally taking firm action to stop the abuse of consumers by Digital payments company Touch 'n Go (TNG).
Being a monopoly, TNG has always abused the welfare of consumers.
The Competition Act 2010 was established to prevent monopolistic behaviour by companies that abused their position in the market, thus causing suffering to consumers.
In relation to the abuses suffered by consumers, Fomca had filed a complaint with the Malaysian Competition Commission (MyCC) on Oct 30, 2018, against the abuses committed by TNG on consumers because of its monopolistic position.
Two years later, on Aug 28, 2020, MyCC responded that it had undertaken an investigation and, according to the results of its inquiry, “the issues raised do not raise any competition concern”. No matter how consumers are abused by TNG, the MyCC feels that it is not an issue of non-competition or the monopoly abusing its power.
There was again abuse of consumer welfare when TNG informed motorists that RFID would replace SmartTag. It sparked consumer anger and outrage. Fomca made a firm stand that consumers should be given a choice and not be forced into purchasing Radio Frequency Identification (RFID).
MyCC was silent again.
Fortunately, the then prime minister made a firm announcement that consumers should be given a choice.
The RFID is being sold at an exorbitant price of RM35. Being a monopoly, it can over-charge consumers. MyCC refused to act to liberalise the sector to ensure open competition whereby consumers would benefit from lower prices and better quality.
MyCC continues to remain silent despite all the complaints by consumers. Indeed, there are a growing number of complaints against TNG.
In light of these complaints and practices, and an ineffective MyCC, Fomca welcomes the action by the new minister to form a special task force to probe complaints and issues regarding TNG.
The new minister is clearly concerned about consumer welfare and consumer protection and we believe that he will stop the bullying and abuses by the company.
Beyond TNG, Fomca also calls on the new minister to review the effectiveness of the MyCC in protecting consumers.
We need a more effective governance and management approach that gives priority to consumer well-being. A failed MyCC would clearly result in higher prices, lower quality and limited choice of goods and services. In the face of the current high costs of living, consumers would suffer further.
Since 1998 Fomca had fought for the creation of the Competition Law, which was enacted in 2012. Fomca strongly believes that a truly free market - free from monopolistic abuses - would greatly benefit consumers through lower prices, better quality and more variety of goods. For example, if the sales of RFID had been liberalised, we are certain that free competition would substantially lower the price.
The MyCC was formed for just that purpose – to liberalise the economy and eliminate monopolistic behaviour. Although there is a law, if the commission fails to act, the law is only good on paper and consumers will continue to suffer.
Fomca again calls on the minister to review the MyCC to make it more effective to protect consumers. The institution should be strengthened to ensure that the commission fulfils its purpose to protect consumers and enhance consumer wellbeing.
PAUL SELVA RAJ is Fomca secretary-general.
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