Taking a cue from Singapore, Malaysia to look into whether Uber-Grab marriage is anti-competition

Grab announced on March 26, 2018, that it was acquiring all of Uber's South-east Asian operations.
Grab announced on March 26, 2018, that it was acquiring all of Uber's South-east Asian operations.PHOTO: AFP

KUALA LUMPUR - Malaysia's Land Public Transport Commission (SPAD) is set to examine ride-hailing company Grab's take-over of rival Uber along with the Malaysia Competition Commission (MyCC) in the wake of an investigation being launched by neighbouring Singapore over possible violations of competition laws.

Datuk Seri Nancy Shukri, Minister in the Prime Minister's Department, said Grab had assured her during a meeting prior to the planned takeover that fare structures would not be affected by the takeover, reported The Malay Mail Online news website.

"In the light of Singapore's findings, however, SPAD and MYCC will have to look into things to see if there is violation of the Competition Act here," Datuk Seri Nancy told The Malay Mail Online when contacted.

Users of the Uber and Grab services have expressed concern that the acquisition will eliminate competition in the ride-hailing market, resulting in a rise in fares along with a decline in quality of the service.

Even before Datuk Seri Nancy's comments, the SPAD and MyCC had said they would monitor Grab to ensure that it did not abuse its new dominance.

On Friday, the Competition Commission of Singapore said it had reasonable grounds to suspect that the deal was detrimental to competition in the republic.

The Singapore agency has commenced an investigation into the pact and proposed interim measures that will require Uber and Grab to maintain their pre-transaction independent pricing.

Grab announced on March 26 that it was acquiring all of Uber's South-east Asian operations, including the UberEats food delivery service. In return, Uber was to receive a 27.5 per cent stake in Grab, as well as a place on the board of directors for Chief Executive Officer Dara Khosrowshahi.

Softbank Group Corp is the majority owner in both companies.

Following the deal, there were reports that Uber's administrative employees were given just two hours' notice to clear their desks at local offices. Uber later clarified that none of its employees would be laid off on account of the acquisition.

Uber drivers are also concerned that they may not be absorbed by Grab due to stricter rules. There are also fears that they will be paid less.

Singapore-based Grab was founded by Malaysian Anthony Tan, 36, and his Harvard University classmate Tan Hooi Ling.