Trademark delimitation agreements in Malaysia: a competition law perspective


Chew Kherk Ying and Chen Hong Sze

Over the past few years, the Asia Pacific region has seen much activity in the area of competition law. In Malaysia, the Competition Act 2010 (CA) came into force on January 1, 2012.

. Although the CA does not presently contain any merger control provisions, the two main prohibitions under Sections 4 and 10 of the CA are modelled on the EU equivalents, such as anti-competitive agreements (Article 101) and abuse of a dominant market position (Article 102), respectively.

The infancy of competition law in Malaysia can be contrasted against the maturity of its IP laws, which have been providing a framework for the regulation of IP rights for decades. Legal counsel would naturally consider the issue of ownership, protection and exploitation of IP in drafting and negotiating IP agreements, but may not appreciate the competition law risks involved in clauses that were previously up to the parties’ discretion.

IP law grants owners the right to monopolise the exploitation of IP, while competition law is premised on preventing the monopoly of goods and services. Despite this conceptual conflict, it appears to have been accepted over the years that the distinction of the scope of each body of law is clear in its actual application. IP laws provide owners with the right to assign and defend IP rights, while competition law is more concerned with the use of those rights. Ultimately, both bodies of law strive to achieve one common goal, which is to strengthen competition.

trademark delimitation; IP rights; competition law. Competition Act.