Price Control and Anti-Profiteering

The Price Control and Anti-Profiteering Act 2018 makes it an offence to profiteer. 'Profiteering' is defined as making an unreasonably high profit, which is measured by a mechanism prescribed in the Price Control and Anti Profiteering Regulations (PCAPR). The first PCAPR came into effect on 1 January 2015, and was replaced by the PCAPR 2016. The current iteration of the PCAPR (PCAPR 2018) came into force on 6 June 2018 and applies to all goods and services sold in Malaysia. 

The PCAPR does not make it an offence to increase prices, but it is an offence to increase the net profit margin of goods or services beyond a certain level. That level is computed with reference to the movement of the net profit margin of the product over the past 3 years, as determined by a prescribed formula. There are exceptions to this formula to take into account declining margins, new products and loss leaders, amongst other scenarios. 

There is no statutory reporting requirements under the PCAPA, however the Ministry of Domestic Trade and Consumer Affairs (MDTCA) does have the power to carry out inspections and require that pricing information is produced. Where businesses are found to be profiteering, fines for a first offence can reach RM500,000.

As a matter of good governance, businesses should ensure that their pricing is compliant with the PCAPA and that any discrepancies can be explained to the MDTCA if a request for information is received.

 

Registration Requirements

Not required

 

Filing & Payment

Not required

 

How We Can Help

Below are the main services we provide in respect of PCAPA. We also offer bespoke services, so if these do not meet your needs, please contact us for further discussion.

  • Briefings on the implication of the PCAPA
  • Review of pricing in the context of the PCAPA
  • Assistance in developing a pricing validation tool under the PCAPA
  • Assistance in developing a PCAPA control framework

 

Contact us

Raja Kumaran

Raja Kumaran

Tax Executive Director and Indirect Tax Lead, PwC Malaysia

Tel: +60 (3) 2173 1701

Yap Lai Han

Yap Lai Han

Tax Executive Director, PwC Malaysia

Tel: +60 (3) 2173 1491

Chan Wai Choong

Chan Wai Choong

Tax Executive Director, PwC Malaysia

Tel: +60 (3) 2173 3100

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