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Commission or corruption – which is it?

July 23, 2017

Although the Tourism Industry Act 1992 forbids tourist guides from receiving commissions, the practice does not harm anyone as long as tourists do not have to pay more.

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CY Ming

On July 15, 40 tourist guides converged at Kota Kinabalu International Airport to protest against unlicensed tourist guides, targeting a tour group from China that arrived at 12.30am.

The protesters confronted the tourists and questioned the legitimacy of their tour leader and warned the visitors of the consequences if he was not. They also followed them to their tour bus.

As a result of the incident, the Chinese tourists were stranded at the airport for two hours when their tour leader fled after being threatened by the protesters.

Several days later, it was discovered the feud was over shopping commissions, which the tour leaders had been pocketing. Being deprived of their share, the tourist guides labelled the tour leaders as selfish and unlicensed, or foreign guides.

If that was the case, the various tourist guide associations in the country should have sorted matters with the various shopping establishments that offered these commissions, so that all parties received a fair share.

It is normal for tour leaders to be paid commissions, as they take charge of their tour groups and are accountable to tour organisers that have appointed them.

It is also customary for tourist guides to be paid a share of the commissions, and some tour companies handling a high volume of tourists earn a sizeable income from shopping commissions.

Tour bus drivers are normally paid a “parking fee” when stopping at these establishments and so are taxi drivers.

Although the Tourism Industry Act 1992 forbids tourist guides from receiving commissions, the practice does not harm anyone as long as tourists do not have to pay more for what they purchase.

For example, one of the most meaningful products to buy in Malaysia is pewter. As a tourist guide and later a taxi driver in Kuala Lumpur, I have always brought tourists to a modern factory manufacturing a world-renowned brand.

I could have taken them to buy other pewter brands and earned higher commissions, but the quality of the pewter looked inferior even from a distance.

It would be interesting to find out why some tour companies and tourist guides prefer to bypass a respectable factory manufacturing a quality brand located along a popular tour route and instead choose to go out of their way to patronise other centres.

But most disturbing are outlets located at warehouses which are normally shut until a tour bus arrives, after which passengers are ushered into a large air-conditioned showroom selling a great variety of products.

The quality and prices of these goods are best left to your imagination, but this is the type of controlled shopping that is frowned upon by the authorities everywhere.

Needless to say, tourists should not be shepherded to these outlets and it is certainly illegal for tourist guides to accept commissions here.

On July 13, the Institute for Democracy and Economic Affairs held a dialogue on tax and regulatory policies. Among the speakers were Sim Choo Kheng, founder and CEO of Sim Leisure Group.

He lamented that tour organisers and taxi operators in Penang asked for huge commissions, which he described as kickbacks.

Some of them asked for a 10 to 20% commission from entrance fees, and in the George Town area, some were getting as much as 40 to 60%.

But he refused to give in to this so-called corruption and felt victimised, as his establishment had been boycotted since day one besides receiving threats of all kinds.

He has successfully designed and built some of the most high-profile theme parks in over 50 countries, but did not do a study of local business practices before building ESCAPE, an adventure theme park in 2012.

His allegations were countered by the Association of Tourism Attractions Penang chairman Ch’ng Huck Theng, who said it was not right to desribe the giving of commissions as “corruption” as this practice was not illegal.

Malaysian Association of Hotels Penang chapter chairman Khoo Boo Lim said the word “kickback” was also inappropriate because it was not illegal for a company to give incentives to those who brought business to it.

Penang Tourist Guides Association president Chin Poh Chin said Sim’s comment was very unfair to the state’s tourism industry as incentives played an important role in the industry’s success.

But former president of Transparency International Malaysia Ramon Navaratnam said corruption had indeed taken place when tour companies and taxi drivers demanded payment from a company for promoting its business through their services.

He said, “If anyone says it is legal, then there must be some form of documentation or contract to prove that those providing the referrals are entitled to a cut.”

The Centre to Combat Corruption and Cronyism executive director Cynthia Gabriel agreed that any perk or incentive needed to be written out clearly in a company’s policy guidelines and the law.

She said, “Anything given under cover or in secret without it being declared as income or a bonus can be considered a bribe, especially if there are conflicts of interest issues.”

As such, the committee that will be formed to look at the role of tourist guides in Sabah, in particular the issue of commissions, will have their work cut out for them.

CY Ming is an FMT reader.

With a firm belief in freedom of expression and without prejudice, FMT tries its best to share reliable content from third parties. Such articles are strictly the writer’s personal opinion. FMT does not necessarily endorse the views or opinions given by any third party content provider.

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