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Vietnam: Grab’s acquisition of Uber scrutinised
HANOI — The Ministry of Industry and Trade has set up a council to scrutinise alleged violations of competition regulations in ride-hailing services firm Grab’s acquisition of Uber’s business in Vietnam.
Investigations will look at Grab Limited Company and Uber Vietnam, both based in HCM City. Six other companies which were suspected of being involved will also be investigated but the ministry did not disclose their names.
Deputy Minister of Industry and Trade Tran Quoc Khanh said the council would review Grab’s acquisition of Uber’s operations in Vietnam, findings of the Vietnam Competition and Consumer Protection Authority and explanations by relevant parties and existing regulations to make a decision.
According to the Vietnam Competition and Consumer Protection Authority’s findings, announced in mid-December, the acquisition violated regulations on economic concentration in the Law on Competition.
The competition authority found that Grab’s market share was more than 50 per cent after the purchase.
Under the current regulations, if Grab held a market share between 30 and 50 per cent after the acquisition deal without reporting it to the management agency, the firm could be fined up to 10 per cent of its revenue for the 2017 fiscal year. If the market share exceeded 50 per cent, the acquisition deal might be banned.
Grab responded by saying it did not violate laws, claiming its market share was below 30 per cent following the sale deal and citing differences in market share calculations between the company and the competition authority.
In March 2018, Grab announced it had completed the acquisition of Uber’s operations in Southeast Asia, including Vietnam. In exchange, Uber held a stake of 27.5 per cent in Grab.
In last September, Singapore’s competition watchdog fined Grab $6.42 million and Uber US$6.58 million over their merger, saying the deal had led to the erosion of competition in the ride-hailing market, the Channel News Asia reported. — VNS
Source: http://vietnamnews.vn/economy/483140/grabs-acquisition-of-uber-scrutinised.html#4qyS9M7UqbLI1BST.99