PCC asks Uber, Grab to continue separate operations beyond April 8

Chrisee Dela Paz

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PCC asks Uber, Grab to continue separate operations beyond April 8
(UPDATED) But Uber Asia Pacific chief business officer Brooks Entwistle says the company no longer has the capital and people to continue its operations in the Philippines and 7 other markets

MANILA, Philippines (UPDATED) – The country’s antitrust watchdog, the Philippine Competition Commission (PCC), flexed its muscle and asked Uber and Grab to continue using their own platforms beyond Sunday, April 8.

This is in order not to preempt the PCC’s voluntary review of the sale of Uber’s Southeast Asian business to its rival firm Grab.

After a 3-hour public hearing conducted by the two-year-old commission on Thursday, April 5, the PCC said it has come up with interim measures to ensure the integrity of the merger review.

Tabled for discussion, among other measures, are maintaining the independence of Uber and Grab’s business operations while the review is ongoing, refraining from imposing exclusivity clauses, and refraining from sharing any confidential information like pricing.

The PCC said it will also ask Uber and Grab to avoid practices that would reduce the business viability of parties involved, as well as avoid practices that would prejudice the watchdog’s power to review the transaction.

“We will impose that the Uber and Grab [apps] will continue to operate beyond April 8, and that they will [still] be operating independently,” PCC Commissioner Stella Luz Quimbo said during the hearing. (READ: PCC warns Grab-Uber deal may have ‘far-reaching impact’ on commuters)

‘No capital, no people’

But Uber said it no longer has the capital and people to continue its operations in the Philippines and 7 other markets.

“[From] a business standpoint, Uber exited 8 markets, including the Phiippines, as of Monday. Now, I look after 10 markets, instead of 18. Our funding is gone. Our people are gone. We don’t intend to come back to these markets,” Brooks Entwistle, Uber Asia Pacific chief business officer, said during the hearing.

Grab, meanwhile, claimed the interim measures of the PCC are “unnecessary” as the end result of the transaction would not have a negative impact on commuters.

The interim measures will not be necessary because the concerns are not really real,” Grab external legal counsel Arlene Maneja said during the public hearing.

“Any concern that the commission may have in relation to operating as a single entity is actually not a real concern because there is nothing in the transaction that actually merges the operations,” she added.

Uber announced last March 26 that it sold its operations in Southeast Asia to Grab. In turn, Uber will receive a 27.5% stake in the business.

A day before the public hearing, Grab said the full transition of Uber drivers to its platform will push through despite the ongoing merger review.

Even if the deal falls below the threshold of the PCC’s mergers and acquisitions review, the antitrust agency has used its power to start looking into the potential effects of the transaction, expressing concern that it would lead to “a virtual monopoly in the ride-sharing market.” (READ: As Uber gives up Philippine operations to Grab, what now for commuters?)

Should anti-competitive concerns arise, the PCC said Grab and Uber may propose commitments to remedy, mitigate, or prevent negative effects on market competition.

The PCC has 75 days to come up with results of its motu proprio review on the Grab and Uber deal. – Rappler.com

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