Grab"s acquisition of Uber shows signs of law infringement: Vietnamese authorities

The deal between Grab and Uber has shown signs of breaching antitrust laws in Vietnam, according to the investigation conducted by Vietnamese authorities published Wednesday.

Preliminary investigation results showed that Grab"s share in Vietnam exceeds 50 percent of Vietnamese market after acquiring Uber, which shows signs of violating Vietnam’s regulation on economic concentration, according to the Competition and Consumer Protection Department (CCPD) under the Ministry of Industry and Trade.

Vietnam"s Competition Law from 2004 requires that all mergers and acquisitions (M&As) that result in a company gaining over 30 percent of market share must be reported to competition authorities. M&As that result in a company gaining over 50 percent of market share are restricted and can only be completed with permission from authorities.

The CCPD is considering opening an official investigation into the deal.

Previously, Grab claimed that its combined market share with Uber in Vietnam is less than 30 percent, so it doesn’t have to “inform to the competition authority before proceeding and completing this transaction in the country.”

However, the ride-hailing app was unable to submit evidence to prove that did not violate the law.  

In the end of March, Grab announced its acquisition of Uber in Southeast Asia. Uber will take a 27.5 percent stake in Singapore-based Grab, and Uber CEO Dara Khosrowshahi will join Grab’s board.

Grab was last valued at an estimated $6 billion.

Vietnamese Uber users started to switch to Grab on April 9.