Uber and Grab, two of the largest ride-hailing companies, are imposed with combined fines of $9.5 million because of their recent merger deal which is found to have disobeyed Singapore’s anti-competition laws. Grab acquired Uber’s Southeast Asia business in March and then merged both the companies. According to the Competition Commission of Singapore, the deal is an anti-competitive practice. The decision has come after a month-long investigation by the commission and it charged both the companies with a hefty fine of $9.5 million combined. Uber has to pay US$4.8 million and grab is charged with US$4.7 million fine.
It was earlier an option given by the commission to unwind the deal but the good news for the company is that the deal will not get affected. As per the reports, Grab has raised $6 billion from investors; it should not be a problem to pay the fine. The investigation concludes that transaction is anti-competitive and under section 54 of the Competition Act, they are liable to pay the fine. Although Grab, the automobile giant whose net worth is valued at $11 billion was not legally compelled to inform the CCCS of its merger deal with Uber, the commission has the authority to question if the deal leaves the merged entity with 40 percent market share.
The fine is associated only with the businesses in Singapore, which is just one of eight markets where Uber and Grab competed.