Grab to be hit with a fine of RM86 million for abusive practices

Malaysia’s competition regulator Malaysia Competition Commission (MyCC) has proposed a fine of more than RM86 million and a daily penalty of RM15,000 against Singapore-based ride-hailing firm Grab for abusive practices on its own drivers.

The MyCC, according to a report by Reuters, said Grab abused its dominant position in the local market by preventing its drivers from promoting and providing advertising services for its competitors.

“MyCC further notes that the restrictive clauses had the effect of distorting competition in the relevant market that is premised on multi-sided platforms by creating barriers to entry and expansion for Grab’s existing and future competitors,” MyCC chairperson Iskandar Ismail told a news conference.

MyCC also imposed a daily penalty of RM15,000, beginning today, for as long as Grab fails “to take remedial actions as directed by the commission in addressing the competition concerns”.

The daily penalty will start today and will be in place for as long as Grab fails to take remedial actions as directed by the commission in addressing the competition concerns.

In a media statement today, Grab says,“We maintain our position that we have complied fully with the Competition Act 2010. We are surprised by the Proposed Decision that we received this morning.

“Whilst our legal counsels are now studying the Proposed Decision, we believe that it is common practice for businesses to decide upon the availability and type of third-party advertising on their respective platforms, tailored according to consumers’ needs and feedback. We will be submitting our written representations to MyCC by November, 27 2019.”

Malaysia would be the third country to penalise Grab after its deal with Uber.

The investigation into Grab follows complaints the company has monopolised the business after it bought Uber’s Southeast Asia operations.

Singapore fined Grab and Uber last year on the merger exercise, it was followed by the Philippines.
In March 2018, Uber sold its business in Southeast Asia to local rival Grab which took its ride-hailing business in eight countries. It also grabbed Uber Eats, which was then present in three countries.

Uber was considered the pioneer ride-hailing  service in Malaysia but it could not compete with Grab in the country. -/TISG