The Philippine Competition Commission on Monday expressed concern over the impact of the merger between ride sharing service providers Grab and Uber on Filipino passengers.
The anti-trust body, which called for a meeting with Grab and Uber Monday, said it might subject the merger to review, either as a notified transaction or a motu proprio case, which refers to an act taken without a formal request from another party.
PCC has yet to receive a formal notification from Grab or Uber. The agency said the meeting with stakeholders on Monday aimed to determine if the transaction would meet the merger notification thresholds and verify if the Grab-Uber transaction was notifiable. Both are foreign companies with presence in the Philippines.
PCC said the acquisition by Singapore-based Grab of Uber’s Southeast Asian business would likely have a far reaching impact on the riding public and transportation services.
It said a merger or acquisition review using competition lens would determine whether the merger of two players in the ride-sharing market would substantially lessen competition.
The commission said it would evaluate and analyze if prices would likely increase after the acquisition, if ride-sharing services would deteriorate or if passengers would effectively have less options.
It said it would also determine how likely other new transport network companies would have a chance in fairly competing against the merged firm.
PCC said it recognized that the exit of California-based Uber in the Philippines would put rival Grab in virtual monopoly of the ride-sharing market until new players came into operation.
PCC said like any other global transaction that it handled earlier, the commission would look into Grab-Uber’s operations in the Philippines as basis for the thresholds.
The agency said it had yet to know the terms and conditions of the agreement but if the notifying group of either Grab or Uber breached the P5-billion threshold for the size of the party and assuming the transaction involved the acquisition of Uber assets inside and outside the Philippines, the applicable threshold for the size of transaction would be P2 billion for the aggregate value of assets of Uber or over P2 billion for the aggregate gross revenues generated in or into the Philippines by assets within and outside the Philippines.
“If the transaction is notifiable, Grab and Uber are not allowed to consummate the deal without the commission’s approval while if the transaction does not meet the threshold and is not notifiable, Grab and Uber are urged to allow a voluntary review to take its course before the consummation of the deal to easily unravel the deal if found uncompetitive,” PCC said.
PCC said if anticompetitive concerns emerged from the transaction review, the parties could propose commitments to remedy, mitigate or present the negative effects to competition in the market after the acquisition.
PCC said if the two parties would not submit voluntarily to the jurisdiction of the commission, the Philippine Competition Act allows PCC to launch a motu proprio review or open a case that may disentangle or block the deal.
PCC said it is mandated by law to review mergers, acquisitions and joint ventures of firms across all sectors. The agency said it was committed to ensure that Grab’s acquisition of Uber in the Philippines would not harm the interest of the riding public.