A Philippine government agency on Monday fined ride-hailing app Grab 23.45 million pesos (469,000 dollars) for breaching pricing commitments in the first year since it took over operations of its main competitor, Uber.
The fines include refunds worth 5.05 million pesos to its passengers for overcharges, the Philippine Competition Commission (PCC) said.
Since Grab merged with Uber in March 2018 and took over its operations in the Philippines, the anti-trust watchdog has been monitoring its activities to ensure fair pricing, good service and non-exclusivity among its drivers.
‘The PCC has resolved to impose a total fine of 23.45 million pesos on Grab for breaching its pricing commitments during the first to third quarters of the initial undertaking,’ the body said in a statement.
Part of the fines will be refunded through a ‘disgorgement system wherein Grab shall return to its riders its commissions’ in excess of a system-wide average fare cap, which restricts price increases to 22.5 per cent in most months.
The commission will continue to monitor Grab's compliance with its commitments for another year, and review for up to four years its promise of non-exclusivity, which could have implications for new players, said Arsenio Balisacan, the body's chairman.
‘Real competition springs not from presence of a new player alone but from evident rivalry among firms in terms of capacity, price and service quality,’ he noted.
In a statement, Grab said it was working closely with the PCC to finalize the ‘voluntary commitments’ to protect consumers and create a healthy competitive environment for businesses.
‘Grab Philippines maintains its compliance with the LTFRB's [Land Transportation Fare Regulatory Board] fare matrix and will work closely with the PCC in implementing the agreed mechanics for the payment, which will be communicated to the public at least five days before paying,’ it said.
‘Grab looks forward to fulfilling these voluntary commitments with the guidance and oversight of the PCC,’ it added.
Grab has remained the dominant ride-hailing company in the Philippines since Uber stopped operations there in 2018. Other ride-hailing companies in the country only offer rides on motorbikes, unlike Grab which also offers trips in cars, as well as other services.
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