The market might suffer from the “substantial lessening of competition” once Grab completes its takeover of rival Uber in the country, according to the complete copy of a recent order of the country’s antitrust body.
The Philippine Competition Commission (PCC) released yesterday the full text of the commission order that listed the interim measures imposed on the Grab-Uber deal.
This is not yet the decision of the PCC, given that the competition watchdog is still reviewing the transaction.
However, this sheds light on PCC’s take on the case, including rebuttals against the usual defenses raised by Grab, Uber and position of the Land Transportation Franchising and Regulatory Board (LTFRB). A copy of the text is available online.
Last month, Grab announced it would acquire Uber in Southeast Asia, calling it the largest acquisition by a Southeast Asian internet-based company.
Officials of Grab and Uber said the deal would not lead to a substantial lessening of competition because there were other means of transportation, citing “tricycles and pedicabs” as among those other means.
PCC, however, said this definition of the market was “overly broad.” Instead, the market in question should only be limited to transport network companies (TNCs) under which Grab and Uber qualify.
“Based on this preliminary assessment, the commission finds reasonable grounds that substantial lessening of competition may result from the transaction, adversely affecting the TNC market,” the order read.
Citing data from LTFRB, PCC said Grab and Uber had about 60,000 partner-vehicles. Grab, for its part, has about 29,446 drivers.
If the deal is carried out and Uber services stop, PCC said there was “reason to assume” that all Uber drivers would transfer to Grab.
By that point, Grab would have 93.22 percent shares of the TNC market. This is a larger estimate, given that PCC chair Arsenio Balisacan previously said the deal would give Grab 80 percent of the market.