PCC fines Grab and Uber P16 million for violating provisions during review of merger

October 17, 2018

The Philippine Competition Commission ( PCC) fined a total of P16 million on Grab Philippines and Uber for violating provisions of the Interim Measures Order (IMO) during a merger review period.

“The IMO is a mechanism that protects the integrity of the PCC review and adjudicatory process. It requires full compliance by both Grab and Uber and these fines reflect their deficiencies and violations. Undue difficulties generated by the parties become efficiency challenges in PCC’s review process,”CC Chair Arsenio Balisacan said.

The  parties were collectively fined P4 million  for failure to keep their businesses separate. It also penalized  Grab and Uber for their failure to delay Uber’s assumption of a board seat in Grab during the review period.

Grab was found liable to pay the penalty of P8 million for failure to maintain the conditions before the transaction, such as pricing policies, rider promotions, driver incentives, and service quality.

Uber, as the acquired party, was fined P4 million or half of Grab’s fine for the same set of violations. The Commission noted that Uber had to comply with the cease and desist order by the Land Transportation Franchising and Regulatory Board set at that time.

The parties committed ten  acts of violation referring to two  out of the seven measures in the order. Each act of violation corresponds to a fine ranging between P50,000 to P2 million.

PCC had earlier asked Grab and Uber to explain why they should not be penalized for  their failure to keep their businesses separate, failure to maintain independent operations at pre-transaction conditions, Grab’s access to Uber’s confidential information, Uber’s assumption of board seat in Grab, and further consummation of the transaction in Grab despite the order. DMS