Khairy: MySejahtera Deal Off If MySJ Disagrees App Belongs To Government

Khairy Jamaluddin says the government’s negotiations with MySJ is much lower than RM300 million and he has informed the MySejahtera “vendor” that another vendor will be selected if the government doesn’t get a fair deal.

KUALA LUMPUR, March 28 – Khairy Jamaluddin told MySJ Sdn Bhd today that the government would not continue with negotiations on MySejahtera if the company insists that it owned the Covid-19 app.

The health minister said the Ministry of Health’s (MOH) current discussions with MySJ – which received MySejahtera’s software licence and intellectual property rights from the app developer, Entomo Malaysia Sdn Bhd (formerly known as KPISoft Malaysia) – revolved around the management of the platform, or provision of software as a service. 

“MySejahtera is owned by the government, its data is owned by the government,” Khairy told a press conference after launching the United Nations University-International Institute for Global Health’s launch of a book titled “Malaysian Health Care: Building for Future Excellence, Equity & Resilience”.

“If they disagree that MySejahtera is owned by the government, except maybe certain platforms that need their source code and such, then we won’t continue with the agreement.”

CodeBlue reported earlier today court documents from a dispute among MySJ shareholders that showed an October 2020 licence agreement between Entomo Malaysia and MySJ, with the former transferring MySejahtera intellectual property and granting the app’s software licence to MySJ for RM338.6 million in a five-year three-month deal extending till end 2025.

According to the terms of the licence agreement, KPISoft will grant MySJ a non-exclusive, non-transferable, non-sublicensable right and perpetual licence to use the KPISoft software to exclusively develop, own the application trademark for MySejahtera, and test and support the MySejahtera app.

However, under the agreement, MySJ only acquires a licence for the KPISoft software, specifically for MySejahtera, “and does not acquire any other rights or ownership interests.”

When pointed out that the MySejahtera licence agreement between Entomo Malaysia and MySJ was worth more than RM300 million, Khairy said: “The amount they agreed with Entomo has nothing to do with our negotiations. I can tell you for a fact that the amount we’re negotiating with MySejahtera is much much lower than RM300 million.”

The health minister also said he has informed the MySejahtera ‘vendor’ that the government is free to select another vendor if the government doesn’t get a fair deal because “the data is still kept by the government.”

“Going with a new company may require a new agreement in terms of maintaining the platform. We’re in the process of looking at what services we need in the long term. We might not need the check-in feature in a few months, so now is a good time to look at the services we need and go on that basis.”

Khairy acknowledged the absence of a contract between the government and KPISoft on MySejahtera when the Covid-19 app was launched early during the pandemic in 2020, since the company developed the app for free for the government as part of a corporate social responsibility (CSR) initiative. 

KPISoft provided MySejahtera services to the government via the National Security Council (NSC), amid the lack of a legally binding agreement throughout the development of the app, said Khairy.

After Khairy replaced Dr Adham Baba as health minister last August, he made the decision to transfer management of MySejahtera to MOH, and to put a contract into place. 

“When I was appointed health minister, I said we need to regularise this service. It cannot be CSR forever; suddenly they’ll ask us to pay.

“So I brought this to the Cabinet and I said we need a contract jointly signed between the government and the company handling this platform. That’s when it started – the negotiations with KPISoft.”

He added that the government then began discussions with MySJ after KPISoft informed Putrajaya that it has granted MySJ the software licence to manage MySejahtera.

“The data is safe. This data is monitored by MOH. We don’t give approval to any party. This data is not shared with the private sector or third party. It’s all only used for public health purposes by MOH.”

When questioned how the government could claim ownership of MySejahtera data without a legal contract with the app developer, Khairy cited a non-disclosure agreement (NDA), saying that the “custodian” of users’ personal data has always been the National Cyber Security Agency (NACSA), NSC, and the Malaysian Administrative Modernisation and Management Planning Unit (MAMPU) under the Prime Minister’s Department.

CodeBlue’s report today also cited Entomo Malaysia’s proposal to the government, made in November or December 2020, on a 15-year public-private partnership (PPP) model until end 2036 that envisioned a super app with digital health, commerce, and payment facilities on MySejahtera.

Due to the government’s mandate for MySejahtera check-ins at public premises, most adults in the country have downloaded the app; MySejahtera has 38 million registered users, including Malaysians, foreigners, and travellers.

Khairy expressed caution with Entomo Malaysia’s MySejahtera PPP proposal, saying it was acceptable if it meant platform maintenance excluding the usage of data for commercial purposes.

He noted that most government departments outsource platform management to the private sector; MOH’s IT department similarly lacks the capacity to maintain MySejahtera.

“On the PPP, we can consider it, but in terms of PPP for commercialisation of data, I disagree.”

The court documents on the RM338.6 million MySejahtera software licence agreement between Entomo Malaysia and MySJ, as well as Entomo Malaysia’s PPP proposal to the government, came from a lawsuit initiated by MySJ shareholder P2 Asset Management Sdn  Bhd against Entomo Malaysia, MySJ shareholder Revolusi Asia Sdn Bhd, and MySJ for alleged breach of a share sale agreement.

The board of directors on MySj – which was incorporated in September 2020 – include EcoWorld Malaysia executive chairman Liew Kee Sin and executive director and chief financial officer Heah Kok Boon, former Sapura Energy Bhd CEO Shahril Shamsuddin, senior Bersatu politician Megat Najmuddin Megat Khas, as well as Anuar Rozhan and Raveenderen Ramamoothie. The latter two had founded KPISoft.

You may also like