The Malaysian Association of Malay Vehicle Importers and Traders (PEKEMA) has expressed its concerns over rumours circulating about that the Pakatan Harapan government might abolish the Open Approved Permit (AP) system. The association is defending the system, which it says has helped to keep the automotive industry competitive, the Malay Mail reports.

According to its president Datuk Zainuddin Abdul Rahman, the system prevents other importers from slapping on significantly higher price tags on imported vehicles. “They cannot simply increase the prices of imported cars as they wish because they need to remain competitive. In order to do so, the other importers must match the prices offered by AP holders,” he told reporters yesterday following a meeting with the Council of Eminent Persons (CEP).

He added that the abolishment should not materialise as it would be against Article 153 of the Federal Constitution which pertains to the Special Position (SP) of the Malays and the Natives of Sabah and Sarawak.

“Tun Daim Zainuddin said many wished to see the system being abolished but I told him to take into consideration the money involved throughout the years. I myself have spent over RM20 million on my showroom and the land. It will not be easy for the government to do away with the system just like that. Why would they abolish a system that stays true to what is dictated in the Federal Constitution? That’s unfair,” he stated.

Zainduddin also urged the government to waive the RM10,000 levy imposed on Open AP holders, something the association has asked for before. He said that the association had not received any of the returns promised by the previous government, although some RM2.7 billion was supposedly collected from 2010 to 2017.

“There are about 800 types of AP in Malaysia and only an Open AP is charged with a fee. It is easy to calculate. The government collects RM10,000 from 35,000 AP holders, so it means they get RM350 million a year. The previous government promised that Pekema members would get 40% of the fee collection for business development purposes, but it never came true,” he explained.

Zainuddin claimed that former minister of international trade and industry Datuk Seri Mustapa Mohamad had in a meeting promised to distribute 40% of the collection to Pekema members, 40% to bumiputeras who wish to join the industry and 20% to the Malaysian Automotive Institute (MAI). “Not even one percent of Pekema members got it, new bumiputera industry players got nil, and only MAI got their allocated 20%,” he said.

The system was supposed to be discontinued by December 31, 2015, under NAP 2009, but the arrival of NAP 2014 left the date open ended. It was announced in mid-2015 that the open AP system would be retained, but improvements to the system were to be made. These were introduced last year, with new rules and requirements put in place.