The former Finance Minister said the move would also send the wrong signal to investors that government policies can be changed at a whim.
DAP’s Lim Guan Eng today said the 51 percent Bumiputera equity requirement for freight forwarding companies cannot be applied retrospectively.
The Bagan MP was responding to a recent news report on the issue, and said the matter had been raised previously and was rejected during his tenure as finance minister.
“It is unfair to those who have built and invested in the companies based on existing conditions only for them to be abruptly changed without due recourse.
“A failure to ensure this will discourage investors and Malaysia will lose out in competitiveness to other countries,” he said in a statement.
The Bagan MP said the move would also send the wrong signal to investors that government policies can be changed at a whim, adding that investors want certainty, consistency and clarity in policies.
He said the failure to ensure this will discourage investors and Malaysia may end up losing its competitive edge to other countries.
Lim urged current Finance Minister Tengku Zafrul Tengku Abdul Aziz to do the needful, adding he would raise the issue in hopes of having the ruling reversed to uphold the practice of good governance.
In January 2021, the ministry announced that all applications for customs licenses must meet the Bumiputera equity requirement although the actual percentage was not stated.
The companies were also informed that non-compliance with the Bumiputera equity requirement by December 31 would result in the cancellation of their customs licenses.
Last week, the Federation of Malaysian Freight Forwarders – representing more than 1,500 logistics companies – sent a letter to International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali asking for clarification on the requirement.
The federation said in its letter that companies would be compelled to sell 51% equity to Bumiputera investors.
“The question is: within this short time frame and difficult prevailing economic conditions, would there be Bumiputera investors wanting to buy over 51% equity? Or would the Bumiputera investors prefer much safer investments?
“And, if present logistics companies are compelled to sell a majority share to Bumiputera investors, it would mean that the government is telling us to sell our business to Bumiputeras or close down our business.
“Selling 51% of the business also means that the present owner can no longer control and run his business,” the letter stated.
FMFF president Alvin Chua voiced concern on how such a requirement would impact the future of the companies.
Lim, who is the DAP secretary-general, said Tengku Zafrul should ensure that the new rule is not be applied retrospectively.
He added that the proposal was unconstitutional and unfair for the freight forwarding companies whose owners had suffered losses from the proposed ownership rule.