Singapore: Singapore authorities on Monday imposed a fine of S$13 million ($9 million) on ride-hailing companies Grab and Uber for violating competition laws in their merger deal.
In March, US-based Uber sold its Southeast Asian business to Singapore-based Grab - its main rival in the region - in exchange for a 27.5 per cent stake in the firm, reports Efe news.
The Competition and Consumer Commission of Singapore (CCCS) opened an investigation the next day and has concluded that the merger has led Grab to increase prices by 10-15 per cent and decrease the amount and frequency of rider promotions and driver incentives.
The CCCS said that after the merger, 80 per cent of Singapore's market came into the hands of Grab, which imposes exclusivity obligations on taxi companies, car rental partners, and some of its drivers.
The competition watchdog imposed a fine of S$6.58 million on Uber and S$6.42 million on Grab to "deter completed, irreversible mergers that harm competition".
"Mergers that substantially lessen competition are prohibited and CCCS has taken action against the Grab-Uber merger because it removed Grab's closest rival, to the detriment of Singapore drivers and riders," CCCS Chief Executive Toh Han Li said in a statement.
The regulator directed Uber to sell its rental vehicles to any potential competitor that makes a reasonable offer based on fair market value.
The CCCS also ordered Grab to ensure that drivers have the freedom to choose any platform and that fares and driver commissions are maintained at pre-merger level, as well as to withdraw exclusivity arrangements with taxi fleets.
The merger was also investigated by the competition watchdog of the Philippines, which in August approved the merger, giving Grab 93 per cent of the local market, after imposing a series of conditions to ensure fair prices.