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Oct 17, 2018 @ 18:04

Grab, Uber fined P16M over ‘anti-competitive merger’

 

The Philippine Competition Commission (PCC) slapped Grab Philippines and Uber with a combined fine of P16 million for violating key provisions of the interim measures order (IMO).

The IMO was issued to the parties to maintain pre-transaction conditions in order to prevent any action that may prejudice PCC’s ability to review the merger or to impose appropriate remedies.

According to the PCC, the parties committed 10 acts of violation. Each act of violation corresponds to a fine ranging between P50,000 to P2 Million.

PCC chair Arsenio Balisacan said the “IMO is a mechanism that protects the integrity of the PCC review and adjudicatory process. It requires full compliance by both Grab and Uber and these fines reflect their deficiencies and violations. Undue difficulties generated by the parties become efficiency challenges in PCC’s review process.”

The fines stemmed from the failure of both riding apps to keep their businesses separate and to delay Uber’s assumption of a board seat in Grab during the review period.

Grab, on its own, was fined P8 million for failure to maintain the conditions before the transaction, 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.

PCC noted that Uber had to comply with the cease and desist order by the Land Transportation Franchising and Regulatory Board during that time.

“While Grab Holdings Inc. and Uber B.V. are businesses operating on a global scale, both MyTaxi.PH, Inc. and Uber Systems Inc. were businesses operating in the Philippines at the time of issuance of the IMO, making the transaction within the ambit of the Philippine Competition Act,” the anti-trust body said.

“This is a fair reminder to parties subjected to merger reviews to cooperate and comply with the Commission’s orders. Selective compliance adds to the burden of the review process, which in turn have real-life consequences on the public. We urge future transactions to observe due diligence,” Balisacan pointed out.

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