Business

Grab - Uber deal is on the verge of facing an offical probe due to breach of antitrust law in Vietnam

By Tran Anh May 18, 2018 | 06:21 AM GMT+7

The Competition and Consumer Protection Department (CCPD) under the Ministry of Industry and Trade considers launching a formal investigation into the acquisition of Uber in Southeast Asia including Vietnam by Grab, after announcing the preliminary results are presenting the sign of breaching antitrust law on May 16.

In particular, after working with the firms, associations and related government authorities, CCPD has found the signs of violations on economic concentration regulated in Vietnam's antitrust law 2014 on the takeover deal with a combined market share of over 50 percent.

Antitrust law also known as competition law, provides regulations on restraint of competition, unfair competition, order and procedures for handling competition cases and measures to handle violations of competition law.

Under the provisions of antitrust law, when the combined market share of the parties accounts for 30 percent to 50 percent of the market without prior notification to the competition authorities for an acquisition, the participating enterprises could be subjected to a fine up to 10 percent of total revenue in the financial year prior to the year of the offense.

Additionally, if the combined market share of the parties is over 50 percent then the transaction can be forbidden.

Previously, Grab confirmed that the total market share of its business in Vietnam after acquiring Uber is still under 30 percent, which according to Grab is unnecessary to report the transaction to the authorities.

Nevertheless, when working with the CCPD, Grab was unable to provide any concrete evidence to support its claim.

As a result, CCPD is considering an official probe eyeing the breach. At the end of the investigation, the Department shall forward the report to the Competition Council for handling according to regulations.

At the end of March, Grab announced the takeover of Uber's business in Southeast Asia, including Vietnam in which Grab will transfer 27.5 percent of its stake to Uber.

According to Reuters, Vietnam’s action broadens scrutiny on the takeover, which is already being inspected for breach of competition law in Singapore, Malaysia and the Philippines.

It is obscure how the deal will be affected if Vietnam or any other nation conclusively confirms the acquisition damages the competition.

However, while increasing regulatory scrutiny could complicate the takeover, lawyers and analysts said there is little the authorities can do to stop Uber from simply exiting the region, as mentioned in The Star Online.

Leading with empathy in Vietnam’s billion-dollar investment flows

Leading with empathy in Vietnam’s billion-dollar investment flows

Business -  2 week

For Koen Soenens, Sales and Marketing Director at DEEP C, empathy is a compass that guides major deals, the way a leader builds a team, and the ambition to create a sustainable industrial zone that carries a Vietnamese identity.

Taseco Land’s new logo marks a new growth trajectory

Taseco Land’s new logo marks a new growth trajectory

Business -  3 week

Taseco Land has shifted its listing to HOSE and introduced a new upward-pointing arrow logo - a visual statement of its strategy to raise capital, expand its land bank, and strengthen its standing in Vietnam’s real estate sector

SAP positions Vietnam as key R&D hub with €150 million investment

SAP positions Vietnam as key R&D hub with €150 million investment

Business -  1 month

Located in the heart of Ho Chi Minh City, SAP Labs Vietnam is the second SAP Labs Network hub in Southeast Asia, following Singapore and is one of 20 countries that have SAP Labs globally.

Solar & Storage Live Vietnam returns, leading sustainability and innovation in energy sector

Solar & Storage Live Vietnam returns, leading sustainability and innovation in energy sector

Business -  2 month

Solar & Storage Live Vietnam event has been running since 2017 and the 2025 edition will be the biggest yet.

New alliance pushes ESG standards for Vietnamese businesses

New alliance pushes ESG standards for Vietnamese businesses

Business -  3 month

A new partnership between EY and the Vietnam-Singapore Board Forum (VSBF) is set to strengthen ESG capabilities for Vietnamese businesses, helping shape more sustainable business models.

US giant backs Vietnam’s bid to lead ASEAN gas trade

US giant backs Vietnam’s bid to lead ASEAN gas trade

Business -  3 month

With strategic deals and strong policy alignment from the Vietnamese government, Excelerate Energy aims to anchor Vietnam’s LNG ambitions in the region.