Grab defends position in Uber deal to Singapore's anti-monopoly watchdog

SINGAPORE (Reuters) - Grab said on Friday it disagreed with the Singaporean anti-monopoly watchdog’s assessment that its takeover of Uber’s operations had harmed competition and called the commission’s suggested measure of removing exclusivity arrangements with drivers as “one-sided”.

FILE PHOTO: A ComfortDelgro taxi passes Uber and Grab offices in Singapore March 26, 2018. REUTERS/Edgar Su/File Photo

Earlier this year, Uber Technologies Inc [UBER.UL] sold its Southeast Asian business to bigger regional rival Grab in exchange for a stake in the Singapore-based firm. But the deal has prompted regulatory scrutiny.

In early July, the Competition and Consumer Commission of Singapore (CCCS) provisionally found that the merger had substantially reduced competition and suggested various remedies, such as the sale of their car-leasing businesses and removing exclusivity obligations on drivers who use Grab’s ride-hailing platform.

The commission said in a statement that it received representations from Grab and Uber on Thursday and will make its final decision after “careful consideration of the involved parties’ representations, feedback on the proposed remedies as well as all available information and evidence.”

The anti-trust body has earlier proposed fines on the firms.

Grab in a written response said the commission allowed other players and new entrants to maintain or enter into exclusivity arrangements with drivers, private hire rental fleet and taxi operators without restrictions.

“Grab believes that this double standard goes against the spirit of increasing choices for drivers and riders,” it said.

Grab was the dominant player in Singapore’s ride-hailing market even before the Uber merger. It also competes with taxi businesses such as ComfortDelGro Corp Ltd.

Several new players, such as India’s Jugnoo and Singapore-based Ryde, have recently entered the city-state’s ride-hailing market. Indonesia’s Go-Jek has also said it would launch services in Singapore.

The CCCS has said the exclusivity arrangements mean a new entrant would have to spend a lot of money to build up driver and rider networks similar in scale and size to the incumbents.

The CCCS’s decision could have wider implications, with Malaysia also saying this month that it was studying monopoly risks triggered by the merger of Grab and Uber.

“By being open and letting competition figure out themselves is the best way to benefit the consumers and is the best way to prove Singapore as the place for innovation,” said Jixun Foo, a managing partner at GGV Capital, an early investor in Grab.

Grab, which maintains that it operates in a market that is broader than private-hire and taxi-booking services, also said it has retained its pre-transaction pricing and driver commissions.

Reporting by Aradhana Aravindan; Editing by Subhranshu Sahu