KUALA LUMPUR, March 26 — Deputy Minister of International Trade and Industry Ong Kian Ming today said that the government has granted open Approved Permits (APs) to 164 companies, including 36 companies that received them in January.
In his winding up speech on the Royal address in the Dewan Rakyat today, Ong said that the freshly issued APs were needed to stimulate competition in the automotive market, and to bar unfair control by existing permit holders.
“For the information of the Dewan Rakyat, effective January 1, 2019, 164 companies were given open APs. This is out of the 283 companies which had applied. So, many were rejected and 36 new companies were given APs.
“So the next question is, why the need to give APs to new companies? I think this is something that has been disputed because maybe, there are people suspecting that these 36 companies are owned by cronies, and if they qualify for APs.
“First reason is to increase competition, because if we only give opportunities to existing AP holders, then I feel they will definitely become complacent. So with the additional new APs, I feel they can compete in terms of the quality of service and in terms of a more competitive price to the existing AP holders.
“Another reason is that we want to give opportunities to new entrepreneurs,” Ong said.
He added that details of the 36 new AP recipients would also be made available on the ministry’s website.
Ong stressed that the rules for AP applicants have also been tightened under Pakatan Harapan’s watch.
He explained that only companies with a minimum business operation experience of two years in the automotive industry, either in selling or distributing commercial vehicles and motorcycles, can qualify.
He added that companies must also have a minimum paid up capital of RM1 million, and its management must not have a stake in other companies which already have Open APs.
“At the same time, each company is given a limit.
“For category 1, where the paid up capital is RM4 million, the number of APs that can be given to a company is 240. For the second category, the number will be lesser and for the fourth category, that is for new companies, they can apply for a maximum of 60 APs only,” Ong added.
He further explained that if the companies fail to sell the number of cars they applied the APs for, the government will not grant them more of such permits, even with an increased paid up capital.
“We want to give new APs to those who are not filthy rich, but to give these new players a chance,” he added.