Even it has laws to prohibit such mergers to protect its consumers’ interest, says Chong Chieng Jen.
An opposition MP today urged Putrajaya to stop the proposed merger between telco giants Digi and Celcom, warning that it would be detrimental to consumers.
Stampin MP Chong Chieng Jen said if it is by Axiata Group Bhd’s own admission that a merger between the two companies’ subsidiaries in Bangladesh could not proceed due to anti-competition laws, then the same should apply for Malaysia.
“If even a country like Bangladesh has laws to prohibit such mergers to protect its consumers’ interest, we in Malaysia should not fall behind in terms of protection of our consumers’ rights and interests in our country,” he said in a statement today (April 13).
Chong, the former domestic trade and consumer affairs deputy minister, argued that the post-merger Digi and Celcom entity would control more than 50 percent of the mobile subscribers market in the country, greatly reducing consumer choice.
In view of this, Chong said the Malaysian Communications and Multimedia Commission (MCMC), as the industry regulator, must invoke Section 133 of the Communications and Multimedia Act (1998) to prevent the merger.
Section 133 states: “[…] a licensee shall not engage in any conduct which has the purpose of substantially lessening competition in a communications market.”
Digi’s majority owner is Norwegian state-owned Telenor while the Axiata Group is a government-linked company where the top three stakeholders – Khazanah Nasional Berhad, the Employees Provident Fund Board and Amanah Saham Bumiputera – collectively own 64 percent of the company.
Former prime minister Najib Abdul Razak warned yesterday that the merger would likely benefit foreign-controlled Digi more than Celcom.
Telenor and Axiata Group had worked on a mega-merger back in 2019 which fell through after four months.
Telenor executive vice-president and head of Asian operations Jørgen C Arentz Rostrup told The Edge that the company was “very dedicated” in Malaysia and Asia.
He said the Digi-Celcom merger aimed to create a strong and capable large company in Malaysia that would benefit both the companies by combining resources to scale and synergise.