The Price Control and Anti-Profiteering (Mechanism to Determine Unreasonably High Profit for Goods) Regulations 2016 (
2017 Regulations)
was gazetted on 22 December 2016. The 2017 Regulations came into force
on 1 January 2017 upon the expiry of the previous regulations on 31
December 2016.
The 2017 Regulations has introduced four notable changes. The changes are summarised below.
(I) Limitation of Scope for Application of the 2017 Regulations
The
2017 Regulations apply only to certain classes of goods, which include
food and beverages, and household goods. Household goods have been
specifically defined to include non-durable household goods and personal
care products purchased for personal, family or household purposes, but
have specifically excluded cosmetic products.
(II) Comparison Using Financial Year (FY) or Calendar Year (CY)
The
determination of unreasonably high profit is made by comparing the
mark-up percentage or margin percentage in a FY or CY. The relevant
period for examination is the base period, which is the first day of a
particular FY or CY when the goods are sold or offered for sale (
Base Period), against the date of investigation of the goods in that particular FY or CY (
Comparative Period).
(III) Change in the Mechanism To Determine Unreasonably High Profit
Under
the 2017 Regulations, the determination of unreasonably high profit is
done using either the mark-up percentage or the margin percentage of the
goods sold or offered using the prescribed formulas. Businesses are
required to satisfy both mechanisms in order to determine whether the
business is making unreasonably high profit.
(IV) Introduction of New Formulas To Determine Unreasonably High Profit
The
2017 Regulations introduced two specific formulas to determine whether
there has been any unreasonably high profits. The formulas are quite
complex and takes into account the mark-up percentage or the margin
percentage.
Under the mark-up percentage mechanism, the mark-up
percentage is calculated by taking into account the sale price less the
cost price, divided by the cost price using a percentage basis.
Under
the margin percentage mechanism, the margin percentage is calculated by
taking into account the sale price less the cost price, divided by the
sale price using a percentage basis.
Under both mechanisms, the
determination of whether profit is unreasonably high is done by
comparing the percentages of the goods sold or offered for sale on the
Comparative Period with the percentages of the goods sold or offered for
sale on the Base Period. If the former is higher, the business will be
considered to be making unreasonably high profit. However, this will not
be the case if the increase in the mark-up or margin percentage is
caused by a reduction in the cost of goods.
Implications for Businesses
To
ensure compliance with the 2017 Regulations, affected businesses should
review and analyse any proposed price increases by examining the
mark-up and margin percentage before and after any proposed price
increase.
In the event of an increase in either the mark-up
percentage or margin percentage, the business must be able to
substantiate the increase with adequate documentation and proper
justification to the Ministry of Domestic Trade, Co-operatives and
Consumerism.
Under Section 18 of the Price Control and
Anti-Profiteering Act 2011, any person who makes profit unreasonably
high commits an offence and is liable, on conviction to:
(a) a
fine up to RM 500,000, or a fine up to RM 1,000,000 for a second or
subsequent offence, where such person is a body corporate; or
(b) a
fine up to RM 100,000 and/or imprisonment up to 3 years, or RM 250,000
and/or imprisonment up to 5 years, where such person is not a body
corporate.
Tweets 30/1/2018
Is BN government
going to enforce the anti-profiteering act on the airlines which charge
incredibly high on Sarawakians flying from Peninsular Malaya to Kuching, Sibu,
Miri and Bintulu on 13-14 February when these Sarawakians are eager to fly back
to their respective hometowns to reunite with the families during the Chinese
New Year and flying back to work on 19 -21 February, 2018? Sarawakians have to pay exorbitant prices to
fly to Kuching one trip RM1039; Sibu RM1009; Miri RM493 and Bintulu RM438. If round trips X 2, count how much a person
has to pay round trips to Kuching and back to work or school.
Where are
the Sarawak ministers, be there represent Sarawak or so called ‘National
Assembly’, to say about these exorbitant air-ticket charges on these Sarawakians
working in Peninsular Malaya? Is it not a living example of how Sarawakians
are exploited or fall prey to the traps set by UMNO-BN government which plunder
Sarawak and Sabah in the name of Malaysia?
When Sarawak is not developed and lack job opportunities, n% of Sarawakians
are lured to Peninsula Malaysia. I often
feel sorry for these Sarawakians and their parents who see the land across the
South China Sea a greener pasture to graze.
So they send their children to Peninsula Malaya for higher education
even if the courses are available in Sarawak.
When can
these Sarawakians wake up to say, “No!”?
To solve
this annual problem, I suggest the concerned Sarawakians to band together to
sue the airlines for charging exorbitant price on the air tickets or no to come
back during this period? We do not need
to celebrate Chinese New Year “at all cost” and see how long these airlines can
go on to exploit us in this way. If
possible, move back to Sarawak for good.
There are lots of opportunities in Sarawak now.
It is
disgusting to see no action of the concerned authorities to enforce the
anti-profiteering act on these profiteering airlines.
