Philippine Competition Commission (PCC) has ordered ride-hailing service provider Uber to continue operating its app beyond April 8, as the local antitrust commission reviews the Grab-Uber deal.
This new directive effective puts Grab's acquisition of Uber to a halt while the review is ongoing.
In an official announcement on March 26, Grab Holdings, Inc. (GHI) confirmed their acquisition of all assets of Uber B.V. (UBV) and Uber Systems, Inc. (USI) in Southeast Asia and has started to carry out the terms of its sale. MyTaxi.PH, Inc. (MTPH), Grab's local arm followed with an announcement that Uber drivers would be migrated into its platform and that the Uber app would no longer be of use in the Philippines by April 9.
"The PCC believes that Uber is capable of operating its ride-hailing app in the country, despite its claims that it has already exited the Southeast Asia market," PCC Chairman Arsenio M. Balisacan said.
Exercising its mandate to protect competition in a looming monopoly and ensure the welfare of the riding public and affected drivers, the PCC has issued a set of Interim Measures while the commission conducts an in-depth review of the Grab-Uber deal.
"Uber is highlighting its exit, but what it does not emphasize enough is its integration with Grab. Thus, Uber is not truly exiting the Philippine market, but rather effectively merging their operations with Grab here. The deal makes Uber a part-owner of Grab," Balisacan said.
"This move by Uber in the Philippine market leads to further substantial concentration of what is, to begin with, an already highly concentrated ride-sharing market. This virtual monopolization of the market by Grab can harm the riding public," he added.
On Thursday, April 5, the PCC conducted a public hearing with Grab and Uber representatives regarding the imposition of interim measures.
The PCC likewise ordered both providers to maintain the independence of their business operations and other conditions prevailing prior to 25 March 2018. These include: ride hailing and delivery platforms; pricing and payment policies including incentives and promotions to riders; product options; customer and rider database; and on-boarding of new partner drivers as well as the fees, charges, and incentives to partner drivers, among other measures.
"Uber’s compliance with our antitrust counterpart in Singapore to extend the operation of its app indicates the feasibility of continuing its operations in the Philippines as well," Balisacan said.
A merger or acquisition review using competition lens will determine whether the merger of two players in the ride-sharing market will substantially lessen competition. The PCC may prohibit any merger should anti-competitive concerns arise out of the transaction review.
PCC is mandated under the Philippine Competition Act to review mergers, acquisitions and joint ventures of firms across all sectors. PCC is committed to ensure that Grab’s acquisition of Uber in the Philippines will not harm the interest of the riding public.