March 19, 2019 / 5:26 AM / 7 months ago

Philippines rejects Go-Jek appeal against ride-hailing license ban

FILE PHOTO: Go-Jek driver helmets are seen during the Go-Food festival in Jakarta, Indonesia, Oct. 27, 2018. REUTERS/Beawiharta/File Photo

MANILA (Reuters) - Indonesian ride-hailing firm Go-Jek lost an appeal on Tuesday against the Philippines’ decision to refuse to grant it a license due to its failure to meet local ownership criteria, in a major blow to its Southeast Asia expansion plans.

Go-Jek, whose backers include Alphabet Inc’s Google (GOOGL.O) and Tencent Holdings Ltd (0700.HK), had hoped to take on Singapore-based Grab which is the dominant player in the Philippines ride-hailing sector.

The firm applied for a license to operate in Manila in August through wholly owned subsidiary Velox but was denied in January, after ride-hailing was added to a list of industries where foreign ownership is limited to 40 percent. [nL3N1Z91BC]

“They filed a motion for reconsideration, but failed to fix Filipino ownership requirement,” Land Transportation Franchising and Regulatory Board (LTFRB) Chairman Martin Delgra told Reuters.

A Go-Jek spokesman said the firm was disappointed and “will now explore our options”.

Several Philippine ride-hailing firms have started operations in the capital Manila and in major provinces over the past two years but have had limited success in eroding Grab’s domestic market share, which stands at over 90 percent.

Reporting by Neil Jerome Morales in Manila and Fanny Potkin in Jakarta; Editing by Christopher Cushing and Stephen Coates

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