Companies want Covid-19 law to protect businesses post-MCO

A coalition representing 20,000 companies wants protection against legal suits for being unable to fulfil contractual obligations as a result of the imposition of MCO.

PETALING JAYA: A coalition of 12 business associations today urged the government to implement temporary legislation to protect business owners from legal suits after the movement control order (MCO) is lifted.

The group said it is of “paramount importance” for a Covid-19 Bill or Act, similar to Singapore’s Covid-19 (Temporary Measures) Act.

It hoped this can be put in place when Parliament convenes on May 18 to protect business owners from legal suits when they are unable to fulfil their contractual obligations post-MCO.

“Contracting parties will not waste time and resources fighting in court over the application or meaning of force majeure clauses, and the legal certainty will result in commercial certainty,” said Raymond Liew, the president of accounting and professional services provider McMillan Woods.

“Furthermore, the Bill/Act should provide for the sharing of financial burden, from the owners of shopping malls, shop lots, offices to factories, and a reduction in rental.

“The relief imposed by law will save jobs, businesses, companies and investments – which will then continue to improve the economy,” he added during an online press conference hosted by the Malaysia Retail Chain Association.

The coalition, which also includes organisations such as the Branding Association of Malaysia, Malaysia Budget Hotel Association and SME Association of Malaysia, said it has 20,000 companies and three million employees under its umbrella.

Apart from the prohibition in taking legal action and the sharing of financial burden of rentals, the coalition also suggested that the Act allow departmental stores and restaurants to operate under strict standard operating procedures, such as limiting the number of people seated at a table or allowed into a restaurant.

The coalition also proposed that current terms and conditions that limit Socso’s claim wage subsidy to 200 employees per company be removed.

It would also like to see private sector employers given the right to manage their workforce and implement wage reduction as they see fit.

Malaysia Retailers Association (MRA) president James Loke said retailers across the country are facing an unprecedented crisis as a result of the MCO, with sales down by as much as 90% in March and April.

“We appeal to the government to come up with this Covid-19 Act so we can avoid unnecessary litigation and focus on reviving our businesses.”

Implemented on March 18 to stem the spread of Covid-19, the MCO – which has now been extended to May 12 – has seen all non-essential businesses closed and strict travel restrictions imposed in the country

Retail Group Malaysia (RGM) recently estimated 61% of total retail outlets in the country and 63.3% of total retail sales have been shut during the MCO.

The group said only 126,000 retailers, such as supermarkets, hypermarkets, mini-markets, convenience stores and pharmacies, have been allowed to stay open.

Ameer Ali Mydin, the managing director of the Mydin chain of hypermarkets, said that while his outlets remain operational, not all of his colleagues had been as fortunate.

“Mydin is lucky as we are still operational and have cash flow, but for many of my other colleagues, it’s zero,” said Ameer, who also heads the Bumiputera Retailers Organisation.

“I feel if there is no such Act in place, eventually many of us who were friends are going to become enemies as we will be going to court to fight things out — and I’m the last person who wants that.”

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