KUALA LUMPUR — BERSATU Puchong Division Associate Wing chief Dato’ Gan Yong Hwa said the government must urgently formulate a comprehensive strategy to address the rapid growth of cross-border e-commerce, with consumer rights, product safety, fair competition and the transformation of local small and medium enterprises (SMEs) as its four main pillars.
He urged the government to implement four key strategies: establish an inter-agency task force to coordinate consumer complaints, taxation and product safety; require major foreign platforms to establish a local legal entity or appoint an accountable representative with genuine authority to provide customer service and manage returns, refunds, compensation and product recalls; strengthen risk-based regulation of food, electrical appliances, children’s products, cosmetics, health products and automotive parts; and provide local SMEs with transformation assistance covering digitalisation, financing, logistics, product certification, brand upgrading and e-commerce training.
Gan said that while protecting the public’s right to purchase affordable goods and exercise freedom of choice, the government must also close regulatory loopholes and ensure that foreign platforms and local businesses comply with the same rules. This is necessary to prevent SMEs from losing their ability to survive because of unfair competition.
“An open market does not mean a market without conditions, and low prices cannot be used as an excuse to lower safety standards. The government must ensure that foreign platforms and local businesses are subject to the same laws.
“Local businesses should not be made to bear the costs of taxes, licences and certification while cross-border goods are allowed to enter the country rapidly at the margins of regulatory oversight.”
He said this after attending a free vegetable distribution programme held along Jalan Besar Sungai Kuyoh in Seri Kembangan, Serdang, Selangor, on Sunday (August 16).
The programme, organised under Program Rapat Rakyat Selangor by the BERSATU Puchong Division Associate Wing and Persatuan Keselamatan Komuniti. Also present were Persatuan Keselamatan Komuniti chairman W.L. Wong.
Gan said Serdang is one of the country’s largest kampung baru and serves as an important location for understanding the pulse of the grassroots economy and the challenges confronting SMEs.
He said his recent engagements with local traders and consumers revealed that the public welcomed the lower prices and convenience offered by cross-border e-commerce platforms. However, complaints were also raised over goods that did not match their descriptions, unsatisfactory quality, difficulties in filing complaints and the high cost of returning products overseas.
He stressed that amid rising living costs, it is reasonable for ordinary families to choose lower-priced products from a wider range of options. Malaysia practises open trade and should not prevent foreign platforms from entering the market merely to protect local businesses.
“Consumers have the right to choose, but they must also have the right to accurate information, safety protection and effective avenues for redress.
“We cannot allow consumers to complete a payment within seconds, only to spend weeks pursuing a cross-border complaint when something goes wrong, before eventually giving up because the return shipping cost is too high.”
Gan said the government must require major foreign platforms such as Pinduoduo and Temu, which are within the PDD Holdings ecosystem, to establish local representative bodies capable of assuming legal responsibility and resolving consumer disputes in Malaysia.
These platforms must provide clear, effective and easily accessible channels for complaints, refunds, returns and product recalls.
He said e-commerce platforms should also disclose complete information on sellers’ identities, product origins, specifications, certification, taxes, delivery timelines and return conditions. Complicated terms and conditions must not be used to transfer all product risks and cross-border return costs to consumers.
Gan said international regulatory developments should serve as a warning to Malaysia. In May, the European Commission imposed a €200 million fine on Temu under the Digital Services Act for failing to adequately assess the systemic risks associated with illegal goods offered through its platform.
The investigation also identified safety concerns involving some of the chargers and baby toys that were tested.
He noted that micro, small and medium enterprises (MSMEs) account for 96.1% of all business establishments in Malaysia and form an important foundation for employment, manufacturing, wholesale trade, retail, logistics and community economies.
Local businesses must bear the costs of rent, employee salaries, utilities, taxes, business licences, product testing and safety certification. The government therefore has a responsibility to ensure that cross-border goods are subject to equivalent tax and compliance requirements.
Gan also expressed concern over the safety of food, semi-processed food ingredients, health products, cosmetics, small electrical appliances, children’s products and automotive parts purchased through cross-border platforms.
He said that if such products fail to comply with Malaysia’s health, labelling or safety standards, the consequences may extend beyond individual consumers and pose risks to public health and personal safety.
He said the Ministry of Health’s Food Safety and Quality Programme currently regulates imported food at the country’s entry points based on risk assessments. However, the government must further strengthen staffing, inspection equipment and platform data-sharing, particularly for high-risk food and raw ingredients entering Malaysia through cross-border e-commerce.
Mechanisms should also be established for source traceability, sampling and inspection, platform takedowns and product recalls.
“The government cannot wait until consumers experience problems after consuming a product before tracing its source. High-risk food, electrical appliances and children’s products should, as far as possible, be regulated at the point of entry and before they are listed on online platforms.”
Responding to industry claims that some foreign nationals may be misusing short-term social visit passes to conduct business or operate food and beverage activities in Malaysia, he urged the Immigration Department, local authorities and relevant enforcement agencies to investigate based on evidence.
The investigations should cover visa or pass status, business licences, hygiene compliance and employment conditions.
He stressed that enforcement must target unlawful conduct and must not be directed at any nationality or ethnic group.
“Legitimate investors should be welcomed, but all operators must comply with the same rules. Law-abiding local food and beverage businesses should not be forced to compete on an uneven playing field.”