New regulations on mechanism to determine unreasonably high profits on sale of goods and supply of services
30 January 2019
On 6 June 2018, the Price Control and Anti-Profiteering (Mechanism to Determine Unreasonably High Profit) Regulations 2018 ("2018 Regulations") came into force. The 2018 Regulations effectively repeal the Price Control and Anti-Profiteering (Mechanism to Determine Unreasonably High Profit for Goods) Regulations 2016 ("2016 Regulations").
Most notably, the 2018 Regulations now apply to any goods sold or offered for sale and any services supplied or offered for supply. Previously, the 2016 Regulations only applied to two classes of goods - food and beverages and household goods.
The 2018 Regulations adopt a formula to determine unreasonably high profit by taking into account the mark-up percentage ("MUP") or the margin percentage ("MGP") in a particular financial year ("FY") or calendar year ("CY"). In particular, the profit is determined to be unreasonably high if the MUP or the MGP on any date in a particular FY or CY exceeds the MUP on the first day of that particular FY or CY, based on the specific formula prescribed by the 2018 Regulations.
The 2018 Regulations is available on the e-Federal Gazette website www.federalgazette.agc.gov.my.