Grab commits to improve service

Grab Philippines has committed to address the concerns flagged by the government, stopping for now the review of Grab’s takeover deal until the antitrust watchdog says whether or not the commitments are “enough.”

Grab submitted to the Philippine Competition Commission (PCC) on June 1 its voluntary commitments, which are supposed to address the issues raised by PCC such as worsening conditions of the company’s ride fares and services.

This was according to Commissioner Stella Alabastro Quimbo, who told the Inquirer that PCC would now have to see whether or not such commitments were acceptable.

She said the commitments were based on Grab’s “interpretation of what they think is a response” to PCC’s statement of concerns, which was published only recently. She deferred from disclosing what those commitments were.

“We have to make a determination that indeed there would be a meaningful change in behavior, meaning a change of behavior that would be enough to really at least return the competitive conditions before Uber exited,” she said.

This develops months after Grab pursued a regional takeover of Uber’s business here in Southeast Asia last March, which raised a lot of concerns in the Philippine commuting public.

Despite a temporary delay that kept its operations going for some time, Uber effectively left the Philippine market on April 16.

Quimbo said that PCC has at most 60 days to decide on the voluntary commitments. Until such decision is made, the ongoing review of the deal “stops.”

What happens next is a discussion wherein PCC and Grab will try to find a way to make the terms mutually agreeable.

This includes additional measures that PCC could impose, if ever it finds Grab’s commitments “insufficient,” she said. Grab would then have to see if these were also acceptable.

However, if there would be a “breakdown in the talks,” then the review would have to continue—which could end with a block or an approval.

“Suppose those additional things are not acceptable to any party, [then] there [will be] no more voluntary commitments. In which case, we revert to the review track. There is a deadline to that,” she said.

The closest glimpse PCC gave to the now stalled review was the statement of concerns that it released recently.

The statement is part of PCC’s review of the deal. In it, PCC essentially said that the price and quality of Grab’s services have worsened after it acquired its only rival in the market, and that not even the entry of new players could challenge the company’s influence.

Even in the absence of a verdict, the statement of concerns issued by PCC’s Mergers and Acquisitions Office (MAO) hinted that the market had already become problematic after the deal.