You are here
CCCS: Grab cannot take over Uber's data, Uber app shutdown postponed again to May 7
UBER'S ride-hailing platform will continue to be available and functional in Singapore until May 7 when it will terminate, the Competition and Consumer Commission of Singapore (CCCS) directed on Friday.
This is even after Uber said in March that it would exit South-east Asia after the acquisition of its regional business by Grab and marks the second extension for Uber from its previous two shutdown dates of April 15 and April 8. The latter was set by CCCS on April 6 to "facilitate its deliberation on the written representations and proposed alternative interim measures" by Grab and Uber.
In a statement on Friday, CCCS said that the May 7 shutdown date of the Uber app is to allow a smoother transition time for riders and drivers as both Grab and Uber comply with its finalised Interim Measures Directions (IMD), which will help ensure the ride-hailing market remains open and contestable.
The finalised IMD, which CCCS revealed in the same statement, will take effect from Friday until the completion of its investigation. The key measures are:
Grab shall ensure that new drivers entering into an agreement to drive on Grab's platform of their own accord are not subject to any exclusivity obligations, lock-in periods and/or termination fees. Grab shall ensure these drivers are not penalised, directly or indirectly, as a result.
The parties shall ensure that drivers who rent a vehicle from Lion City Rental are free to drive for any ridehailing platform and shall not be subject to any impediments (eg higher rental rates and/or lack of insurance coverage) that limit their ability to drive for any ridehailing platform. This shall be clearly communicated through an email to these drivers.
Grab shall cease its exclusivity arrangements with all taxi fleets in Singapore, provided that (a) there are no exclusivity arrangements in Singapore between any taxi fleets and any third-party ridehailing platform other than Grab, and (b) that all taxi operators permit their respective taxi drivers to drive for any third-party ridehailing platform for metered and fixed fare jobs.
Grab shall not take over operational data (eg, historical trip data) from Uber to enhance its market position. Grab may however receive personal data of drivers, riders and merchants (eg, names, contact details, and supporting documents for vocation licence applications) who have expressly opted in and moved to the Grab platform.
Each party shall maintain their pre-transaction pricing and product options for riders and drivers, including the levels of base fares, surge factor and driver commission rates.
The parties shall clearly communicate through an email to drivers and riders in Singapore who were on the Uber platform that migration to the Grab platform is purely optional (ie, drivers and riders have a choice whether to migrate to Grab and are not required to download or use Grab's ridehailing platform).
An independent monitoring trustee shall be appointed to monitor the compliance of the IMD.
CCCS said that a key reason behind the IMD is that Grab and Uber are each other's closest competitors and have a significant combined market share in Singapore. "Their close rivalry can be seen from the surge in Uber's fares following the recent outages of Grab's app," said the watchdog.
The commission added that barriers to entry are likely to be high due to strong network effects, in that the larger the number of drivers available on a ridehailing platform, the larger the number of riders will be attracted to use that platform, and vice versa.
"In particular, many drivers are constrained by exclusivity arrangements such that they can only drive for one ridehailing platform. This makes it difficult for a new ridehailing platform to attract drivers.
Further, a new entrant would likely have to invest a significant amount of upfront capital in order to attract drivers and riders to move over from the incumbent ridehailing platform, so as to build up a critical mass of users. The new entrant would likely have to continue sustained investment in order to compete with the incumbent ride-hailing platform."
CCCS also noted that after Grab announced its acquisition of Uber's South-east Asian business on Mar 25, both platforms have begun transferring assets (such as historical trip data) immediately.
"Consequently, the IMD is necessary to prevent further transfers and preserve CCCS' ability to make appropriate directions if CCCS makes a finding of infringement at the end of CCCS' investigations to remedy, mitigate or eliminate any adverse effects of such infringement."
CCCS - which was previously known as the Competition Commision of Singapore - added that its investigation into the Grab-Uber deal is ongoing and it will be contacting all relevant parties to obtain necessary information.
The Land Transport Authority, which regulates ridehailing platforms such as Grab and Uber, said on Friday said that it supports the IMD proposed by CCCS. LTA said: "In particular, we note that the measures pertaining to the removal of exclusivity obligations and impediments to market contestability will further promote market competition in the point-to-point (P2P) transport sector."
LTA added that it is in the process of reviewing the broader regulatory framework for the P2P sector, including studying how to structure the sector and licence private hire car (PHC) booking service operators.
"This is to ensure the sector remains open and contestable and no single operator dominates the market to the detriment of commuters and drivers. Where necessary, we will work with CCCS, taxi companies, and PHC booking service operators to operationalise CCCS' IMD requirements."