I don't know whether I am reading the right rulebook or not (I just hit the result from searching "FIG tie-break rules"), but only the artistic gymnastics section clearly stated that the tie-breaker is valid for all events in FIG calendar.
e.g: Tie-breaker rule is applied when Yulo's score is tied with our gymnast.
Whereas in the rhythmic section, the rulebook described tie-breaker for Olympics, World Games, and the World Champs, but no specific mention for other events. This might be the loophole, and together with that crappy handbook, Malaysia is simply using that as justification.