Singapore’s competition watchdog sets interim measures for Grab-Uber merger

Singapore’s competition watchdog sets interim measures for Grab-Uber merger

The Competition and Consumer Commission of Singapore (CCCS) issued several interim measures on Friday (Apr 13), as it continued its investigation into Grab’s acquisition of Uber. 

SINGAPORE: The Competition and Consumer Commission of Singapore (CCCS) issued several interim measures on Friday (Apr 13), as it continued its investigation into Grab’s acquisition of Uber

The measures include preventing Grab from taking over Uber’s operational data, such as historical trip data, to enhance its market position.

Grab will also need to ensure that new drivers entering into an agreement to drive on its platform are not subject to exclusivity agreements. However, there are provisions to this measure in that other parties should not impose these agreements too, and all taxi operators permit their drivers to drive for any ride-hailing platform for metered and fixed fare jobs, the watchdog said in its press release.  

Another measure required the ride-hailing firms to maintain their pre-merger pricing and commission levels.

CCCS also said that an independent monitoring trustee will be appointed to make sure the measures are complied with.

The announcement came after CCCS’ own concerns about the merger, feedback from third-parties and a review of the companies’ written representations responding to the interim measures, which the competition watchdog proposed on Mar 30.

The measures took effect Friday and will last “until the completion of CCCS’ investigation and/or resolution of any competition concerns that may arise from the transaction or unless otherwise varied or revoked by CCCS due to material changes in market conditions”, according to the release.


The release also stated that the Uber platform will continue to be available in Singapore until May 7 instead of the previously stipulated Apr 15 “to allow a smoother transition time for riders and drivers”.

This is despite reports that Uber no longer has the capital and manpower to continue operations in Southeast Asia.

“Our funding is gone. Our people are gone. We don’t intend to come back to these markets,” Rappler reported Uber’s Asia Pacific chief business officer Brooks Entwistle as saying at a recent hearing with the Philippine Competition Commission.

A Grab spokesperson also told Channel NewsAsia that since Uber had exited the region on Mar 25, it will no longer be funding any operations of its app. 

"In the spirit of cooperating with the CCCS, Grab has agreed to continue to bear the costs of the Uber app extension until May 7, 2018, and will have a small team to manage Uber's call centre to provide basic customer service around contractual and payment issues," she said.

"We encourage interested Uber users to start transitioning over to the Grab app, where all private-hire car rides are covered by Grab’s personal accident insurance policy provided free of cost to drivers and passengers. Uber users have a choice of whether to do so."

Channel NewsAsia understands that private-hire vehicle drivers already need to have commercial motor and third-party liability insurance, but Grab provides additional coverage for these drivers and their passengers.

CCCS said it thought the measures were necessary to address competition concerns, including the large combined market share Grab and Uber enjoy.

Barriers to entry into the ride-hailing market in Singapore are also “likely to be high due to strong network effects”.

“In particular, many drivers are constrained by exclusivity arrangements such that they can only drive for one ride-hailing platform. This makes it difficult for a new ride-hailing platform to attract drivers,” it said.    

“After the transaction was completed on Mar 25, 2018, Uber and Grab have begun transferring assets (eg historical trip data) immediately,” said CCCS.

“Consequently, the (interim measures are) necessary to prevent further transfers and preserve CCCS’s ability to make appropriate directions if CCCS makes a finding of infringement at the end of CCCS’s investigations to remedy, mitigate or eliminate any adverse effects of such infringement,” the watchdog added.

However, a Grab spokesperson told Channel NewsAsia that it "has not received historical trip data from Uber".


In response to these interim measures, Grab stated that they "appreciate" CCCS accepting their alternative interim measures and have also agreed to extend the availability of Uber until May 7.

"We trust that the CCCS’ review takes into account a dynamic industry that is constantly evolving, highly competitive, and being disrupted by technology and new services," said head of Grab Singapore Lim Kell Jay.

However, Mr Lim also noted that the interim measures should not bring about "unintended effects".

"The interim measures should not have the unintended effect of hampering competition and restricting businesses that have already been investing in the country over the years," he said.

In the statement, Mr Lim also said that Grab is aware of CCCS' objective of "giving drivers choice" and are "fully supportive" of extending its platform to all taxi drivers, including ComfortDelGro drivers who may be constrained to fixed fare JustGrab jobs. 

"We recognise CCCS’ commitment to preserving competition; all companies - no matter big or small, digital or traditional - are capable of innovation in a free market.

"We will work within the set constraints and continue to focus on building better products to compete, ensuring fairness for passengers and drivers, and cultivating the local tech talent pool through our regional R&D centre in Singapore," said Mr Lim. 


The Land Transport Authority (LTA) also responded to CCCS' interim measures on Friday, saying that they are supportive of the terms.

"In particular, we note that the measures pertaining to the removal of exclusivity obligations and impediments to market contestability will further promote market competition in the point-to-point (P2P) transport sector," read LTA's statement. 

The transport authority also added that they are "reviewing the broader regulatory framework for the P2P sector". This includes studying how to structure the sector and license private-hire car (PHC) booking service operators.

"This is to ensure the sector remains open and contestable and no single operator dominates the market to the detriment of commuters and drivers.

"Where necessary, we will work with CCCS, taxi companies, and PHC booking service operators to operationalise CCCS's interim measures directions requirements," added LTA.

Source: CNA/hs/aa(aj)