Malaysian Court Halts Record RM367m Feedmill Penalty
The Malaysia Competition Commission (MyCC) imposed a total penalty of RM367 million on four feedmill companies in 2023, marking the largest fine in the country’s history. The penalty was issued in December 2023, following MyCC’s investigation into alleged price-fixing in the agribusiness sector. A Malaysian High Court judge has now temporarily halted enforcement of that penalty while the firms pursue a judicial review. The stay, granted on Tuesday, prevents MyCC from collecting the full amount until the legal challenge concludes.
The Competition Appeal Tribunal (CAT) upheld the penalty earlier this year, distributing it as follows: Leong Hup Feedmill Malaysia Sdn Bhd was slapped with a RM157.47 million penalty, Gold Coin Feedmills (M) Sdn Bhd with RM97.51 million, Dindings Poultry Development Centre Sdn Bhd with RM70.02 million, and FFM Bhd with RM42.69 million. The CAT had dismissed the four feedmillers’ appeal in February, with the tribunal’s decision finalizing the penalty amounts.
Following the dismissal of their appeal by CAT, the four feedmillers then filed for judicial review. The companies, represented by their counsel, have argued the potential effect of if they are required to pay the penalty, as this would result in increased borrowings, expenses, affect the liquidity of the company, and may disrupt the business operations of the parties.
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The trial judge for the stay hearing, Alice Loke Yee Ching, in her broad grounds, said the balance of convenience and balance of justice tilts on the four companies should their judicial review be successful.
The judge emphasized that the companies had provided credible evidence that irreparable harm-such as increased borrowings, liquidity issues, and operational disruptions-would result if they paid before the challenge was resolved. MyCC, represented by Tan Sri Tommy Thomas and other counsel, was required to maintain the status quo until the merits of the challenge were determined. Besides the four named feedmillers, another feedmiller, PK Agro Industrial Products, has not opposed its financial penalty.
The High Court approved the review in March, confirming the case was not without merit. In judicial review proceedings, leave is first sought to ensure the challenge is not frivolous, vexatious, or an abuse of the court process.
