MITI: Decision On Open APs To Be Finalised Soon

The government is expected to make a decision (again...) on the controversial Open Approved Permits (APs) import control mechanism soon, said Minister of International Trade and Industry (MITI), Datuk Seri Mustapa Mohamed.

"We made a study. The study is almost finalised, they are getting a date from me to make the briefing, and then we will present it to the government," said the minister during the National Automotive Policy Status Update at MITI's office in Kuala Lumpur earlier today.

Datuk Mustapa also said that the briefing to him should be scheduled sometime around next week.

The controversial Open APs are due to be terminated by 31-December 2015 but to date, there has been no clear decision made on the matter.

Back in January 2014, when the third National Automotive Policy (NAP) was announced, Datuk Mustapa said that an announcement on the matter can be expected around February or March 2014.

"The issue is more complex than what we initially thought," said the minister when asked on NAP 2014's stance on Open APs.

Background

AP is an import-control mechanism based on the Malaysian Customs Act 1967. Items that fall under the list of controlled imports include cars, motorcycle helmets and equipment to manufacture drugs and optical discs. Depending on the item, APs are issued either by MITI or other relevant government bodies.

For cars, there are two types of APs issued by MITI: Franchise APs that are given out for free to franchise holders of car brands registered with MITI; and Open APs that are sold to parallel importers at RM10,000 a piece to import cars of any brand.

The total number of APs issued each year is capped at 10 per cent of the number of locally-assembled cars in the preceding year. Sixty per cent of APs are given to Bumiputera Open AP holders while the remaining 40 per cent are given to franchise holders, the majority of which are Bumiputera-owned.  

The actual number of Open APs given out each year however is unclear as the information is not made public. The prevalence of parallel-imported vehicles in this country, and the opaque manner in which Open APs are given out, are major concerns to franchise holders.