E-money is an instrument that contains monetary value paid in advance by any user like ourselves to the e-money issuer (for example, Touch 'n Go Sdn Bhd) to be able to make payments to purchase goods or services from third party merchants (such as expressways and retail outlets). E-money falls under what is known as a 'payment instrument under the Financial Services Act 2010' ("FSA"). The FSA empowers Bank Negara Malaysia ("BNM") to designate such payment instruments as a designated payment instrument ("DPI").
Prior to 2005, only banks were allowed to issue e-money. However, now, BNM has liberalised its guidelines by allowing non-banks to also issue e-money. Further, to become an e-money issuer, issuers must follow the standards published by BNM in addition to the operational requirements of the FSA. Although regulations and guidelines are readily available to assist interested parties in the application for an e-money license, there is still little information available about BNM's decision-making process. There are also no pointers as to foreign equity restrictions, making it difficult for foreign applicants to assess the likelihood of approval.
The increasing use of e-money raises the risk of money laundering as it provides transacting parties with an easy way to transfer financial value. These risks have of course been identified and an issuer of e-money must therefore comply with the Anti Money Laundering and Anti-Terrorism Financing Act 2001 ("AMLATFA"). Regulators should therefore be monitoring the threats posed to this twenty first century innovation and implement adequate policies to facilitate this economic change.
The full article on this, which appeared in the 3 August 2015 issue of the Malaysian newspaper The Sun, can be accessed here.
The Malaysia Competition Commission ("Commission") recently conducted an Online Public Engagement process to get feedback on the recently proposed amendments to the Competition Act 2010 and the Competition Commission Act ("CCA"). The proposed amendments have, amongst others, extended the scope of the Act so that 'enterprises" will now cover individuals and partnerships. The proposed amendments will also aim to provide consumers with greater economic benefits (e.g. proposed amendments to section 5(a) of the Act). Other than streamlining processes, there are a few significant proposed amendments which appear to provide the Commission with wider powers of enforcement. Examples of these relate to a proposal to empower the Commission to require persons to attend a private hearing before the Commission and a proposal to make it compulsory for parties to make written representations to the Commission after a proposed decision id issued by the Commission.
Since the coming into operation of the Act on 1 January 2012, it has been amended once by carving out from the application of the Act, upstream petroleum activities in Malaysia.
We issued a Client Update setting out the key proposed amendments to the Act and the CCA. To access the Update, click here.
