16 April 2018
For Immediate Release
The motu proprio review of the Philippine Competition Commission (PCC) shall take its course in pursuit of its mandate. As the antitrust authority, our lens is always focused on the market—in this case, we are reviewing the potential effects on competition in the merger between Grab and Uber in the ride-hailing platform.
As of today, Uber users have received e-mails with a direct endorsement to transfer to Grab with it as sole provider of ride-sharing service.
When a big player buys out its competitor, there will be many economic and legal factors that need to be scrutinized. PCC intends to expedite the completion of the review ahead of the allowed timeframe given how it is imbued with public interest.
PCC is aware that there are many factors that led to the shutdown of the Uber app. This development may have rendered the review conditions to be less than ideal, however, this move shall not derail the motu proprio review of the Grab-Uber transaction.
The parties are given until April 17 to explain why they have failed to continue operating the platform, as required in the Interim Measures Order.
Grab’s buyout of Uber will mean gobbling up 93% of the ride-hailing market. The accreditation of new TNCs is a welcome development to allow passengers to have more choices. We note, however, that the incoming TNCs are left with only 7% share in the market.
Established firms have the advantage of an existing user base due to “network effects.” This means that when you buy a firm, in effect, you also get its customer base. This is an advantage that a newcomer does not have. PCC’s review will take into consideration these factors to level the playing field in this market.
The above concerns only strengthen our resolve to pursue the review using the antitrust law. In the end, PCC stands with the passengers to protect them from the perils of monopoly.