MyCC fails in bid to reimpose RM10m fine against MAS, AirAsia

The Federal Court dismissed the Malaysia Competition Commission’s (MyCC) review application to reinstate a fine of RM10 million each on MAS and AirAsia over an alleged anti-competitive pact.

A three-person bench chaired by Court of Appeal president Amar Abang Iskandar Abang Hashim today unanimously denied the competition commission’s bid to review the apex court’s previous decision to deny leave to appeal.

On Feb 9 last year, the apex court dismissed MyCC’s application for appeal leave to quash the Competition Appeal Tribunal’s (CAT) decision to set aside the commission’s fines against the two commercial airlines.

MyCC initially won via judicial review at the Kuala Lumpur High Court in 2018 to nullify CAT’s ruling and reintroduce the fines. However, MAS and Airasia succeeded in an appeal before the Court of Appeal in 2021 to set aside the fines.

During online proceedings, Iskandar ruled that MyCC failed to cross the threshold that would require the apex bench to exercise its inherent jurisdiction and allow the review.

“There is no iota of evidence that the leave (to appeal) application (heard and dismissed by the Federal Court last year) was tainted with denial of natural justice,” he said on behalf of bench member judges Zabariah Mohd Yusof and Harmindar Singh Dhaliwal.

Iskandar also ordered MyCC to pay a total of RM100,000 in costs to both MAS and AirAsia, with each airline to receive RM50,000.

In 2014, MyCC fined MAS and AirAsia RM10 million each over both airlines’ alleged breach of the market sharing prohibition under Section 4(2) of the Competition Act 2010 by entering into an agreement on sharing markets in the air transport services sector within Malaysia.

The RM10 million fine was based on flights by both airlines in the four months between Jan 1 and April 30, 2012, on the Kuala Lumpur-Kota Kinabalu, Kuala Lumpur-Kuching, Kuala Lumpur-Sandakan, and Kuala Lumpur-Sibu routes.

Both airlines then appealed to CAT. On Feb 18, 2016, the non-judicial body set aside MyCC’s decision to impose the fines, ruling that the airlines did not infringe Section 4(2) of the Competition Act 2010.

MyCC then filed the judicial review with the Kuala Lumpur High Court to seek a certiorari order to overturn CAT’s decision and to reinstate the commission’s decision to mete out the fines on MAS and AirAsia.

Grave injustice

The competition commission’s legal team is headed by counsel Lim Chee Wee.

Lawyers Logan Sabapathy and Ambiga Sreenevasan appeared for MAS and AirAsia respectively.

Earlier during the apex court hearing of MyCC’s review application, Lim submitted that the commission would suffer grave injustice as a competition regulator if it is denied leave to proceed with the appeal to reimpose the fines.

The counsel said that the Federal Court’s decision last year had permanently shut the doors on MyCC’s appeal against CAT’s ruling.

In response, Logan countered that there was no proof that the apex court’s ruling last year was marred with any breach of natural justice.

High threshold

The lawyer pointed out that prior to filing the review bid late last year, MyCC seemed to have accepted the Federal Court’s ruling earlier last year, and had even undergone an exercise to propose amendments to the Competition Act 2010.

The amendment exercise is understood to refer to proposed changes to the act to prevent a similar situation like today.

“There is a high threshold for a review as there should be finality to litigation,” Logan said.

Ambiga also submitted that the court should just dismiss MyCC’s review bid and that the competition commission should just proceed with its law amendment exercise. - Mkini