Gov’t fines Grab, Uber P16M for ‘causing undue difficulties’ on merger review

The country’s antitrust body fined Grab and Uber P16 million for causing undue difficulties that prejudiced the review process of their controversial takeover deal.

Top officials of the Philippine Competition Commission (PCC) said Wednesday that the violations of these companies have made the review process unnecessarily difficult, despite clear orders against such actions.

Grab Philippines, now the largest transport network company in the country, would shoulder bulk of the fine. On the other hand, Uber would also be asked to pay despite having left the country already.

The issue stems from a regional takeover deal earlier this year, wherein Grab acquired Uber’s operations here in Southeast Asia.

PCC previously flagged this, launching a review amid concerns that the deal might come at the expense of the ride-hailing public.

“The fines are imposed for causing undue difficulties on the PCC review and decision making process,” PCC Commissioner Stella Quimbo in a press briefing.

While the review was later set aside after Grab committed to make certain changes in its operations, the violations nevertheless still “prejudiced” the review process, according to Quimbo.

These promised changes — called voluntary commitments — are currently being monitored. A violation could lead to more fines and even an unwinding of the deal “in an extreme situation where there would be a blatant disregard” of the commitments, she said.

Broken down, both companies are collectively fined P4 million for failure to keep their businesses separate.

Grab, for its part, has been penalized to pay P8 million for failure to maintain pre-merger conditions such as pricing policies, rider promotions, driver incentives, and service quality.

Uber, as the acquired party, was fined P4 million or half of Grab’s fine for the same set of violations.

The company was given a reduced penalty since the Land Transportation Franchising and Regulatory Board (LTFRB) ordered it to stop operations, despite PCC’s interim measures.

Nevertheless, Uber was still fined because it was not entirely helpless in the LTFRB’s case.

According to PCC Commissioner Johannes Bernabe, the company could have filed for a motion of reconsideration “if they were really keen on complying with the PCC order.” /kga