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CHAPTER 1
INTRODUCTION
The word “competition” was traditionally understood to mean price competition,
however in the present era it can come in the forms of branding and advertising, quality,
marketing, and research and development (R &D). The main objective of competition
law has been said to promote economic efficiency.1
The main objective of this research is to determine, whether or not, Malaysia should
introduce single competition legislation2 in the post-WTO era in the light of its existing
laws.3 This research attempts to find out the benefits of introducing competition policy
and competition law in Malaysia. This research will identify a proposed competition
structure that is viable for Malaysia by considering relevant economic policies and
relevant legislation together with common law principles applicable in Malaysia. This
study will identify types of restrictive trade practices that have been controlled in the EU
and UK. This dissertation will evaluate the extent of the existing laws, whether directly
or indirectly, encourage competition between undertakings4 in Malaysia. The evaluation
also touches on the enforcement and remedies aspect of the existing laws. Comparison
will be made to other jurisdictions, especially the UK, and the EU. Examples from other
countries are referred in the discussion where it is relevant.
1
Please see chapter 3 of this study.
The term ‘competition law’ is used in the European Union while the United States uses the term ‘Antitrust
law’. In Germany, it is known as ‘Kartellrecht’.
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In this study, the existing laws refer to Federal legislation and common law. It omits States legislation
and Adat law.
4
Undertakings means legal entities in the market place.
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This research will begin with the history and development of competition law in the UK
since sixteenth century right up to the present era. The discussion on the history and
development of competition law will cover statutory and common laws. It is followed by
a discussion on the competition law from the international perspectives and it covers the
extraterritorial application of domestic competition law, and the latest move by the
international bodies, such as, the United Nations Conference on Trade and Development
(UNCTAD), the Organization For Economic Cooperation and Development (OECD), the
Asia-Pacific Economic Cooperation (APEC), The Association of South-East Asia
Nations (ASEAN), and World Trade Organization (WTO).
The theory and objective of competition law will be explained as to lay down the
foundation of this study, and it includes several basic economic concepts, such as, law of
demand and supply, costs, perfect competition, monopoly, oligopoly, workable
competition, market definition, and market power. The objectives and techniques of
competition law will also be part of the discussion, and it is followed by a brief
discussion of competition policy in the EU, UK, and US.
In dealing with the competition policy and law from Malaysia’s perspective, this study
attempts to discuss the government’s existing policies, such as, New Economic Policy
(NEP) and National Development Policy (NDP), Price and Supply Policy, Privatization
and Liberalization Policy, and Policy on International Agreements. This is followed by
discussion and proposal on the competition policy structures for Malaysia.
2
The existing legislation related to competition aspects will be dealt with by dividing the
discussion into the categories of the doctrine of restraint of trade, economic torts,
legislation related to trade, trade union, and anti-dumping, public facilities, intellectual
property, domestic trade and consumer affairs, communications and multimedia.
As for the anti-competitive practices, it covers horizontal agreements, vertical
agreements, and take-overs and mergers. The discussion for each category of anticompetitive practices will begin with definition, introduction of the law of the EU and
UK, and followed by the discussion of Malaysia position.
Comments and
recommendations will be made in the discussion for each of the anti-competitive
practices. This study will also deal with the aspect of exemption, exclusion, and the
intellectual property rights.
The concluding chapter of this research will summarize on
whether Malaysia should introduce single competition legislation, possible reform to the
existing laws, and possible competition policy structures and law for Malaysia.
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