Grab's acquisition of Uber in Việt Nam did not constitute an act of economic concentration, said VCC. — Photo tuoitre.vn
HÀ NỘI — Grab’s acquisition of Uber in the country did not violate Việt Nam's competition law, the Việt Nam Competition Council (VCC) has said.
According to a press release sent by the Ministry of Industry and Trade (MoIT) on Wednesday, the acquisition did not translate into an act of economic concentration by obtaining ownership of another enterprise as stipulated in Article 17 of the Competition Law and Article 34 under Decree No 116 on Competition.
The decision was made after VCC held a hearing on the case on June 11 with the presence of all involved parties.
On Wednesday, the VCC announced its decision to reject the conclusion of the MoIT’s Việt Nam Competition Authority (VCA) that Grab had infringed the competition law by acquiring Uber’s operations in Southeast Asia, including in Việt Nam.
On March 26, 2018, Grab announced it had acquired Uber's Southeast Asia operations for an undisclosed sum. Shortly after, on April 16, VCA decided to conduct a preliminary investigation into the purchase, saying it may have violated the Law on Competition 2004.
VCA had said the combined market share between Grab and Uber in Việt Nam exceeded 50 per cent, which would be a breach of the regulations.
According to the ministry, if the combined market share of the parties accounted for 30 to 50 per cent in the market before the acquisition, the firms will be fined 10 per cent of their total revenue from the previous financial year. If the figure exceeds 50 per cent, the transaction will be overruled.
However, Grab claimed it had acted legally and that the competition authorities have misinterpreted the scope of relevant markets when calculating its market share.
Việt Nam is not the only country where Grab has come under fire in Southeast Asia.
The Philippines’s competition watchdog fined both ride-hailing firms in October 2018 to the tune of a cumulative 16 million pesos (US$$296,873). Singapore in September 2018 announced a fine of $13 million on Grab and Uber for their merger. — VNS