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This article was first published in The Straits Times on 6 April 2018.
Grab-Uber Merger: What’s Next
Source: The Straits Times
Date: 6 April 2018
Author: Adrian Lim
Ride-hailing operator Grab announced last week that it had acquired the South-east Asia business of its rival Uber but the authorities in Singapore, Malaysia and the Philippines are scrutinising the merger for possible infringement of competition laws.
The Competition and Consumer Commission of Singapore (CCCS) has proposed interim measures requiring Grab and Uber to maintain independent pricing, pricing policies and product options as they were before the acquisition. But it has yet to issue an order on this.
The Straits Times looks at what’s next for this Grab acquisition.
When will Uber cease to operate here?
Despite the proposal, Grab will still shut down the Uber app on April 8. The UberEats food delivery app, however, can be used till the end of May.
What will happen to the Uber app?
Users can still view their past trips in ratings in the Uber app. The account remains active and can be used in countries outside South-east Asia, where Uber operates.
What will happen to Uber drivers?
Since the acquisition was announced on March 26, Uber drivers have been signing up with Grab.
It said it will honour contracts which Uber’s drivers signed with Uber-owned car leasing firm Lion City Rentals until these agreements expire.
While the contracts required them to drive exclusively for Uber’s platform, Grab said these drivers will be able to accept Grab bookings.
After the contracts expire, drivers can opt to rent a car from one of Grab’s fleet partners.
How will the merger affect existing Grab users?
Grab has asked users to bear with it if there is a service disruption during the transition period as it tries to get Uber drivers onto its platform.
What action can CCCS take against Grab and Uber?
Experts said that CCCS has the power to require Uber to continue providing services independently.
However, the National University of Singapore law faculty’s Associate Professor Burton Ong said that such a move would be “intrusive”, adding that there is nothing stopping Uber from leaving the Singapore market.
In the Singapore market, the authorities can also ask Grab to continue operating without Uber’s resources, such as Uber’s customers database or (ride-matching) algorithms.
Mr Wun Rizwi, Partner, RHTLaw Taylor Wessing, said if there is non-compliance with CCCS’ orders, it can apply to the State Courts to enforce its decision.
CCCS is conducting its investigations into the merger and is expected to issue its directions soon.