Enforcement of Price Control and Anti-Profiteering

Starting January 1, 2017 the Ministry of Domestic Trade, Cooperatives and Consumerism has gazetted Price Control and Anti Profiteering Regulations (Mechanism To Determine Unreasonably High Profit for Consumer Goods) 2016 to act against profiteering activities. These regulations replace the Regulations for Price Control and Anti Profiteering (Mechanism to Determine Unreasonably High Profit) (Net Profit Margin) 2014 which was in force until 31 December 2016.

This rule uses the formula of calculating the markup percentage or the margin percentage on the first day of the financial year or the calendar year to determine basic profit of the business. The percentage is based on the mark-up percentage or margin percentage on the first day of the previous year and the trend of mark-up percentage difference or margin percentage difference for the previous 3 years.

Determination of profiteering (unreasonably high profits) is made using assessment period of the financial year or the calendar year of business. Profiteering occurs when the mark-up percentage or margin percentage for the current year exceeds basic profits percentage in that year.

This rule does not set a profit rate of goods traded or sold. However, the Ministry has a basis through a mechanism in this Regulation to ensure that the benefits determined or received by the dealer for an item is reasonable based on prior information data.

Ministry initiated enforcement and application of the Regulation to 2 categories of goods, namely, food and beverage and household items. Household goods comprise non-durable items including personal care products. Priority is given to this item as it has a direct impact on household spending and the cost of living of the people. However, the Ministry will extend the enforcement of this regulation to other goods and services based on need and fairness factors. These Regulations apply to all levels of the business for goods that fall within the scope of regulatory requirements.

A transitional period of 5 months commencing on 1 January 2017 and ending May 31, 2017 shall be given to the traders for the preparation of compliance with this Regulation. The Ministry is implementing an advocacy program to provide clarification and explanations to stakeholders, especially traders who are subject to enforcement to enhance understanding and awareness of compliance with these Regulations.

Any party who commits an offense making unreasonably high profits will be liable to action under the Price Control and Anti-Profiteering Act 2011 for profiteering. If convicted, an individual will be charged with a fine of RM100,000 or three years imprisonment or both for the first offense while for the second and subsequent offense he/she will be liable to a fine of RM250,000 or five years in prison or both. In the event a corporation or company is convicted it will be fined RM500,000 for the first offense while a fine of RM1 million for a second or subsequent offense.

Any complaints regarding price and profiteering can be made to the Ministry through:

  • telephone 03-8000 8000 1Malaysia One Call Center (1MOCC);
  • Information and Strategic Operation Movement Center (PIGOS) Toll-free line 1-800-886-800;
  • Ez ADU smartphone app;
  • Emeil to e-aduan@kpdnkk.gov.my;
  • SMS to 15888 by typing “KPDNKK ADUAN” <complaint details> ” ; and
  • make a report at any KPDNKK offices nationwide.

Anti-profiteering Unit
Enforcement Division
Ministry of Domestic Trade
Cooperatives and Consumerism

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