Uber ordered to continue operating beyond April 8

MANILA, Philippines — The Philippine Competition Commission (PCC) has ordered ride-hailing service provider Uber to continue operations until the agency completes the review of its merger with Grab.

In a statement yesterday, PCC told Uber to continue operating its app for the duration of its review.

PCC’s directive came following the issuance of its order dated April 6, which halted Grab’s move to acquire Uber while the commission is still reviewing the deal.

“The PCC believes that Uber is capable of operating its ride-hailing app in the country, despite its claims that it has already exited the Southeast Asian market,” PCC chairman Arsenio Balisacan said.

“Uber is highlighting its exit, but what it does not emphasize enough is its integration with Grab. Thus, Uber is not truly exiting the Philippine market, but rather effectively merging their operations with Grab here. The deal makes Uber a part-owner of Grab,” Balisacan added.

With the announcement that Grab is buying the assets of Uber in Southeast Asia, the PCC said the parties have started carrying out the terms of its sale, including the migration of Uber drivers to its platform and the shutdown of the Uber app by April 9 in the Philippines.

Even though the transaction did not meet the threshold required for compulsory notification under the Philippine Competition Act, the PCC has decided to undertake a motu proprio review of the Grab and Uber merger.

In a bid to protect competition in what it called a “looming monopoly,” the PCC issued a set of interim measures to ensure the welfare of the riding public and the drivers, while the review is ongoing. 

“This move by Uber in the Philippine market leads to further substantial concentration of what is, to begin with, an already highly concentrated ride-sharing market. This virtual monopolization of the market by Grab can harm the riding public,” Balisacan said.

Among the measures provided in the order is for Grab and Uber to maintain the independence of their business operations and other conditions prevailing prior to March 25, including ride-hailing and delivery platforms, pricing and payment policies, as well as incentives and promotions to riders.

Product options, customer and rider database and on-boarding of new partner-drivers as well as the fees, charges and incentives to partner drivers are also enumerated in the PCC order.

“Uber’s compliance with our antitrust counterpart in Singapore to extend the operation of its app indicates the feasibility of continuing its operations in the Philippines as well,” Balisacan said. The PCC is mandated to protect competition in the market and prohibit anticompetitive conduct, including mergers and acquisitions of businesses and companies that may substantially prevent, restrict or lessen competition. A merger or acquisition review determines whether the two players in the ride-sharing market will substantially lessen competition.

Eventually, the PCC could prohibit it should anticompetitive concerns arise.