Accusations on Touch ‘n Go’s monopolistic behaviour a clear misconception – MyCC

Accusations on Touch ‘n Go’s monopolistic behaviour a clear misconception – MyCC

Competition Act 2010 (Act 712) states being dominant in a particular market is not an infringement

MyCC recognises that TnG monopolises the toll payment system only – they became a monopoly naturally as soon as the government decided, via a gazette, to abolish cash payment for tolls nationwide with the intention of reducing the congestion at the toll booths for the convenience of highway users.

THE Malaysia Competition Commission (MyCC) has been called to respond to the grave allegations made against MyCC by Datuk Paul Selva Raj on behalf of the Federation of Malaysian Consumers Association (Fomca) as reported in several media outlets yesterday, accusing MyCC for failing to put an end to the monopolistic behaviour of Touch ‘n Go Sdn Bhd and TnG Digital (TnG).

In response to the aforesaid allegations, MyCC wishes to clarify that it is cognisant of the issues raised by the public, including Fomca and other stakeholders on this matter and has been continuously monitoring the market in which TnG operates.

For this purpose, it is crucial that MyCC carefully articulates the issues arising from the conduct of TnG to ensure that members of the public are well-informed and assured of MyCC’s commitment to promoting healthy competition in the relevant market.

It has come to MyCC’s attention that there is a clear misconception imposed by Fomca on the issues of monopolies. The Competition Act 2010 (Act 712) clearly sets out that being a dominant or monopoly in a particular market is not an infringement.

However, a monopolistic or dominant enterprise infringes Act 712 only when it abuses its position in the market.

In this instance, MyCC recognises that TnG monopolises the toll payment system only. They became a monopoly naturally as soon as the government decided, via a gazette, to abolish cash payment for tolls nationwide with the intention of reducing the congestion at the toll booths for the convenience of highway users.

That said, MyCC does not have jurisdiction over consumer issues between TnG and its users. TnG being an electronic money service provider is governed by Bank Negara Malaysia (BNM) through its relevant laws and guidelines.

As for the association between TnG and toll concessionaires with regard to the toll payment system, it is governed by the Malaysian Highway Authority.

However, MyCC stands firm that the issues with TnG that came to the attention of MyCC only relate to consumerism including the issues brought up to us by Fomca in 2018 as our thorough assessment showed that despite being a monopoly for the toll payment system, the conducts of TnG did not raise any competition concerns under the Act 712.

Among the earliest issues that cropped up often involved parking surcharge of 10%, difficulty to top up due to the scarcity of reload channels, reload charge of 50sen at certain places, delayed refunds for dormant or lost cards, and other customer services-related matters. All these issues have also been raised by Fomca.

MyCC had subsequently intimated to Fomca that these are not competition-related issues. However, it seems that Fomca could not accept a legitimate conclusion of a regulator up until today and insisted that MyCC should address consumer issues despite our laws clearly focusing on competition matters.

Nonetheless, MyCC carried out some limited intervention on all these issues and since then have resulted in changes being implemented by TnG.

Now, we observe that:

– parking surcharge had been abolished by TnG at 94% of its sites in 2021;

– more TnG reload channels, offering free-of-charge reload services, have been made available;

– TnG NFC cards have been introduced to enable reloads via mobile phone on TnG eWallet apps; and

– refunds for dormant or lost cards are done within 30 days as per the requirement imposed by BNM provided that sufficient information has been provided to TnG.

Additionally, some of the issues above were raised and answered in Parliament sessions as early as 2019 by the government.

MyCC will continue its efforts in assisting the government as and when required on issues pertaining to TnG.

The recent statement by Fomca is highly appreciated and MyCC strives to embrace constructive comments that can help MyCC to re-evaluate its role in promoting competition in the Malaysian economy, with reservations about misplaced allegations and perceptions.

On January 17, 2022, MyCC, on its own initiative, once again stepped in and conducted a discussion with PLUS Expressways Bhd and TnG to address another issue relating to the implementation of the radio-frequency identification (RFID) system by TnG.

As stated by MyCC via its press statement dated January 19, 2022, MyCC shared its assessment and concerns on the implementation of RFID, including the need to consider not only the payment of tolls via debit or credit cards but also other e-wallet systems.

A week after MyCC’s press statement, the then works minister Datuk Seri Fadillah Yusof issued a call to all highway concessionaires to be ready for the implementation of a multi-lane free flow system (MLFF), which is a barrier-free tolling system.

Upon implementation of the MLFF, highway users will be able to use any digital mode of payment, hence eliminating the monopoly of the toll payment system by TnG.

This month, the public’s frustration with the products and services of TnG including RFID, TnG NFC card and TnG Visa card has reached its peak.

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