Red vs yellow: MyGas loses bid to renew gas distribution licence through legal proceedings

Petroniaga distributes gas in red cylinders while MyGas's trade mark is yellow cylinders.

By DayakDaily Team

KUCHING, July 3: The Kuching High Court today has upheld the decision of the Director of Gas Distribution (the Director) not to renew the licence for MyGas Sdn Bhd (MyGas) to sell or distribute subsidised liquefied petroleum gas (LPG) in Sarawak when the licence expired on Nov 30, 2023.

MyGas, primarily owned by a Thai company, has been selling subsidised LPG in Sarawak since 2013 under the Ministry of Domestic Trade, Consumer Affairs and Co-operatives’ Control of Supply Act, 1961.

Post-2018, however, the licensing responsibility shifted to the Director under the Distribution of Gas Ordinance, 2016, nullifying the federal ministry’s authority to issue such licences.

MyGas was issued a license by the Director of Gas Distribution to sell subsidised LPG to domestic consumers in Sarawak until Nov 30 last year.

Despite MyGas’s appeals, the Director refused to extend the term of its licence for subsidised LPG sales.

Nonetheless, MyGas retained permission to import LPG from Thailand and sell unsubsidised LPG to commercial and industrial consumers, who do not qualify for subsidised LPG.

The sale and distribution of subsidised LPG to domestic customers is now undertaken solely a subsidiary of Petroleum Sarawak Berhad (Petros), called Petroniaga Sdn Bhd which uses red gas cylinders.

On Dec 14, 2023, MyGas applied to the High Court in Kuching for Judicial Review to quash the Director’s decision not to renew its license to sell subsidised LPG and for an order or Mandamus to compel the Director to issue MyGas with such a licence.

MyGas named the Director, the Minister of Utility and Telecommunications and the Sarawak government as respondents.

The Judicial Commissioner, Dato Faridz Gohim Abdullah held today that the decision not to renew MyGas’ licence was in line with the Sarawak government’s public policy to have more Sarawakians and Sarawak companies involved in the business of gas distribution, particularly in the distribution of subsidised LPG.

The Courts would not intervene in any decision made based on government policy, so as not to transgress into the matters under the executive arm of government.

Further, he ruled that there was no basis for the Court to intervene in the circumstances of this case.

He said the facts and the law show that MyGas has no legitimate expectations to have its licence to sell subsidised LPG renewed as and when such license expires.

The renewal of such licence is at the sole discretion of the Director. In this case, the decision of the Director was based on government policy and hence cannot be challenged in Court.

The High Court also ruled that the Director had not acted unfairly as MyGas’ licences to import LPG or sell unsubsidised LPG in Sarawak remain unaffected. MyGas was ordered to pay RM30,000 costs to the respondents.

MyGas was represented by Mr Alvin Yong. Acting for the respondents were Sarawak Legal Counsel Dato Sri JC Fong who was assisted by legal officer officers Voon Yan Sin, Khairul Kabir and Simson Sim. — DayakDaily