English
Philippines: Grab-Uber deal seen restricting competition
Antitrust authorities have initiated a review of Grab’s purchase of Uber’s Southeast Asian operations, noting that the deal “may likely lessen, prevent or restrict competition substantially.”
In a decision issued on Tuesday, the Philippine Competition Commission (PCC) directed its Mergers and Acquisitions Office (MAO) to launch a motu propio investigation as both Uber and Grab had yet to file a formal notice.
It also noted that Uber had indicated that the transaction was not covered by compulsory notification requirements under the Philippine Competition Act (PCA).
The PCC said that Section 20 of the law allowed it to prohibit mergers or acquisitions that substantially affect competition. Its rules also provide for a review on its own initiative if “there are reasonable grounds to believe that Section 20 of the Act has been or is likely to be infringed”.
The commission said that based on news reports and as confirmed in a meeting on April 2, a bill of sale dated March 25, 2018 was executed for the acquisition by Grab Holdings and MyTaxi.Ph Inc. of the assets of Uber B.V. and Uber, Systems Inc.
Preliminary assessments by the MAO, it noted, found “reasonable grounds” that it would restrict competition in the ride-hailing market.
Indications are “the transaction will result in a substantial increase in concentration of an already highly concentrated market in an industry that provides a basic public service,” it said, adding that “the riding public and partner drivers may be adversely affected…”
Both Grab and Uber have said that all ride-hailing requests should be made via the Grab platform beginning April 9.
Social media users have expressed concerns over higher travel costs, posting screenshots showing much higher Grab fares compared to Uber’s for identical trips.
The Competition Commission of Singapore (CCS) last Friday halted the integration of Uber and Grab’s operations in that country, saying it wanted to probe concerns that the deal would give Grab a virtual monopoly.
Based on reports, Uber and Grab would have to maintain separate pricing and cannot share customer, driver and operational information unit until the CCS investigation is completed.
Malaysia on Monday also said that it would be keeping a close watch on Grab, with the country’s competition law to be invoked if the company imposes unfair practices or sudden fare increases.
Source: http://www.manilatimes.net/grab-uber-deal-seen-restricting-competition/390375/