Following Singapore, Philippines regulator forces Grab to delay closing Uber’s app

Grab has given the Uber app a stay of execution in yet another market as regulators across Southeast Asia continue to investigate the merger deal announced between the ride-hailing companies last month.

Fresh from extending the closure date a week in Singapore, Grab has done the same in the Philippines, a spokesperson confirmed to TechCrunch. This extension follows an order from the Philippine Competition Commission (PCC) made over the weekend, and it now means that Uber’s app will cease running in the country on April 16.

Elsewhere, Grab shuttered the Uber app in its six other markets in Southeast Asia today as planned, two weeks after the merger deal was confirmed. As for UberEats, that app will live on in the region until the end of May, after which it will be folded into GrabFood.

It appears that Grab didn’t count on Southeast Asia’s regulators being so intent to probe the tie-up.

The Competition and Consumer Commission of Singapore (CCCS) said last month that it had “reasonable grounds” to suspect that the deal may fall foul of section 54 of Singapore’s Competition Act, while the PCC voiced similar concerns last week.

“This move by Uber in the Philippine market leads to further substantial concentration of what is, to begin with, an already highly concentrated ride-sharing market. This virtual monopolization of the market by Grab can harm the riding public,” the organization’s chairman Arsenio M. Balisacan wrote in a statement.

That was countered by Uber, which argued that it is no longer in business in the region.

“Uber exited eight markets, including the Philippines, as of Monday. Now, I look after 10 markets, instead of 18. Our funding is gone. Our people are gone. We don’t intend to come back to these markets,” Brooks Entwistle, head of Uber’s Asia Pacific business, told the PCC at a hearing on Friday, according to Rappler.

If Uber is gone, who will run the app? That’s a valid question raised by the Land Transportation Franchising and Regulatory Board (LTFRB) in the Philippines, which pointed out that consumer safety could be compromised without customer services and other Uber teams.

For now, Grab is stepping up and running the Uber app at its own cost, the company has confirmed. That may keep the lights on, but Grab-operating the Uber doesn’t really address the core issue of the PCC which is competition between two players. On that count, Uber has already left the building.

An excerpt from Grab’s (long) statement to the PCC is below:

Considering that Uber has exited the region on 25 March and clearly stated during the public hearing its incapacity to fund the operations in the Philippines, the parties have agreed to keep the Uber app operational with Grab bearing the costs, to give drivers and consumers time to adjust to Uber’s departure. In the spirit of cooperating with the PCC, Grab has also agreed to continue to bear the costs of the Uber app extension (from March 25 to April 8) until April 15, 2018. Our understanding from the PCC is that this interim arrangement, which was fully explained to the PCC, is not a breach of its Order.

Grab wishes to clarify that, although the Uber app continues to operate, it has limited functionality and little or no support. Grab noted that the LTFRB has expressed concerns pertaining to customer support and safety issues arising from Uber’s limited operations. Grab wishes to stress that this interim arrangement is only for the purposes of satisfying what the PCC appears to require until Grab is able to discuss with the PCC.

We hope that the PCC will sit with the parties to hear their sides and give a fair assessment of the concerns expressed by both parties and that any other action taken would take into account the practical hurdles that may lie across the parties’ paths.

The full read — for those who like regulatory filings and responses to them — can be found here.