Grab app - Illustrative image (Source: VNA) Hanoi (VNA) – The Ministry of Industry and Trade (MoIT) of Vietnam has requested Grab to report on its purchase of Uber in the Southeast Asian market, including Vietnam.
Talking to the Vietnam News Agency on March 28, deputy head of the ministry’s Vietnam Competition Authority (VCA) Trinh Anh Tuan said that his office had sent a dispatch asking the Singapore-based GrabTaxi Holdings Pte Ltd to provide all related information and documents on this deal.
According to Tuan, the requirement conforms with clause 2, Article 7 of the Law on Competition which stipulates that the MoIT has the responsibility for controlling all economic concentration activities in the Vietnamese market.
Under the Law on Competition, Merge and Acquisition (M&A) deals which greatly affect market competition will be limited.
Therefore, a report on Grab’s purchase of Uber must be sent to the VCA so that it can assess competition impacts before and after the deal is done.
In addition, Grab and Uber have to ask permissions of all competition agencies in Southeast Asian countries which have the same regulation, Tuan stated.
The VCA will have a written answer for Grab within 45 working days since it submits all necessary documents.
Earlier on March 26, Grab announced that all of Uber’s motorcycle and taxi drivers in Vietnam would have the opportunity to work for Grab from April 8.
According to Grab’s announcement to acquire Uber’s Southeast Asia operations, Grab will integrate Uber’s ridesharing and food delivery business in the region into Grab’s existing platform.
As part of the acquisition, Uber will take a 27.5 percent stake in Grab and Uber CEO Dara Khosrowshahi will join Grab’s management board.
"This deal is the largest-ever of its kind in Southeast Asia," ride-hailing service Grab said in a media release on March 26.
"With the combined business, Grab will drive towards becoming the number one online-to-offline (O2O) mobile platform in Southeast Asia and a major player in food delivery."
It will take over Uber’s operations and assets in Singapore, Malaysia, Cambodia, Indonesia, Myanmar, the Philippines, Thailand and Vietnam.
Uber on the same day also sent emails to its customers, confirming that “Uber will be combining our operations with Grab to lead you in the next chapter of ridesharing in Vietnam and across Southeast Asia.”
To minimise disruption, Grab and Uber are working to migrate Uber drivers and riders, Uber Eats customers, merchant partners and delivery partners to the Grab platform. The Uber app will continue to operate for two weeks to ensure stability for Uber drivers.
Uber’s withdrawal from Southeast Asia aims to help the corporation increase its profits in the context that it has invested about 10.7 billion USD since being established nine years ago.
Grab is one of the most frequently used O2O mobile platforms in 195 cities in Southeast Asia. More than 5 million people use the combined platform daily.-VNA
VNA
