Those who abuse the approved permits (AP) given to them will be punished, said international trade and industry minister Datuk Darell Leiking, who urged those who have proof to step up.

He said that in response to recent reports alleging that Putrajaya had approved 38 new open AP holders who were not in the car business, but merely looking to sell their permits to established AP holders. The existing AP holders have had their annual AP quotas reduced to accommodate the new recipients, it was claimed.

Open APs are required to import used or recond cars, while franchise APs are used by official brand distributors bringing in new CBU units.

“Show us the proof and I will make sure that I myself will ketuk kepala (knock the heads) of those who abuse this AP,” he told the media in KL yesterday, as reported by Bernama. Leikeng added that all the new AP holders had been evaluated by internal and external auditors to ensure that they met the government’s requirements.

“If there are allegations of abuse, we want to see proof. Don’t create stories and leave it at that. If there is proof, why don’t you show me who are these people and that they are selling their APs. What we want to do is to get to the truth, tangkap (catch) whoever sells the AP. And if these people do, we expose who they are — their directors and families — because that’s wrong,” he said at the same MIDA event, picked up by The Edge.

Earlier, MITI said in an official statement that the new open AP policy had been implemented with effect from January 1, 2019. Under the new policy, there’s no limit to the overall number of APs to be released throughout the year and companies may apply for additional APs based on their sales performance.

The ministry said nearly 300 applications were received by it when an offer for application to become an open AP company was made from May 23 to June 21 in 2016. It said that after an evaluation process, including an audit by a qualified independent auditor, 164 companies qualified to become AP holders, and of these 128 are existing companies while 36 are new.

“Conditions that needed to be fulfilled, among others are, the company must be 100% owned by Bumiputeras, including in key management posts, and it has at least two years of experience in selling and distributing motor vehicles, and a strong financial position,” the ministry said.

It added that at the moment, most of the new companies are still not fully in operation as they need to fulfil some technical requirements and be prepared for business operational matters. It added that the details on current qualification as an open AP company as well as the latest list of open AP holders have been published on its portal.

The ministry said the implementation of the new open AP policy is in line with the government’s decision in 2015 to continue the policy with some improvements, including providing the opportunity to new Bumiputera entrepreneurs to participate in the industry. It added that the new policy, which should have been implemented in January 2017, was postponed for almost two years due to uncertainties in the domestic automotive market.

The companies are subjected to the conditions and rules imposed by MITI, which will continuously monitor and audit them. Under the new policy, the ministry said it will take decisive measures if there is a breach of any of the conditions.

These include withdrawing or suspending the allocated and approved APs, blacklisting the companies (including every shareholder and board member of the company) from submitting any future application on open APs, and taking a legal action against the company. The ministry stated that last year, it blacklisted nine existing companies for offenses and for not complying with the conditions.