THE Philippine Competition Commission (PCC) on Tuesday, April 3, announced that it has opened a motu propio review on the Grab-Uber deal after a preliminary assessment indicated that the transaction would adversely affect the riding public and partner drivers.
In a statement, the commission said no notification of the transaction has been filed by any of the ride-sharing services providers involved.
Grab Holdings Inc. and MyTaxi.PH Inc. are acquiring the assets of Uber B.V. and Uber Systems Inc. in the Philippines and in Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand and Vietnam.
The commission met with representatives of Grab and Uber on Monday, April 2. Grab and Uber reportedly claimed that their transaction is not covered by the compulsory notification requirements under Section 17 of the Philippine Competition Act.
The antitrust body, however, said a preliminary assessment of the transaction showed that “there are reasonable grounds that the said acquisition may likely substantially lessen, prevent, or restrict competition.”
The preliminary assessment was conducted by the Mergers and Acquisitions Office (MAO).
“The transaction will result in a substantial increase in concentration of an already highly concentrated market in an industry that provides a basic public service,” PCC said.
“The commission found in the same preliminary assessment that the riding public and partner drivers may be adversely affected by the transaction,” it added.
Under the Philippine Competition Act, the commission has the power to review mergers and acquisitions that have a direct effect on trade, industry or commerce in the Philippines.
Only upon the commission's approval can a merger be implemented or consummated.
The commission recently raised the threshold for required notification, set at P1 billion when the law was enacted, to P5 billion for the Size of Person/Party and P2 billion for the Size of Transaction.
The Size of Person/Party refers to the value of assets or revenues of the ultimate parent entity of at least one of the parties, while Size of Transaction refers to the value of the assets or revenues of the acquired entity. (MVI/SunStar Philippines)