1. The Competition Appeal Board (“CAB”) has, on 29 December 2020, dismissed the appeal by Uber against the decision of the Competition and Consumer Commission of Singapore (“CCCS”) that Uber’s sale of its Southeast Asian business to Grab for a 27.5% stake in Grab (the “Transaction”) resulted in a substantial lessening of competition (“SLC”) in the ride-hailing platform market in Singapore and infringed section 54 of the Competition Act.

2. The CAB upheld (a) the directions issued by CCCS to Uber and Grab at the material time to lessen the impact of the Transaction on drivers and riders and ensure the ride-hailing platform market remained open to new players (“Directions”); and (b) the financial penalty of S$6,582,055 imposed on Uber. Uber was also ordered to pay CCCS’s costs in relation to the appeal.

3. In its decision, the CAB noted that while Singapore has a voluntary notification merger regime, this does not mean that there are no risks to parties proceeding with a merger before first notifying CCCS. Particularly in situations where the merger is irreversible, as was the case for Uber, the merger parties run not just the risk of infringing section 54 of the Competition Act, but also the further risk that any commitments they may subsequently offer (to remedy, mitigate or prevent any SLC or any adverse effects that result or may result from the completed merger) may be rejected by CCCS as inadequate or inappropriate. 

4. Significantly, the CAB held that CCCS could, when exercising its discretion whether to accept commitments, consider the need to deter businesses from engaging in anti-competitive practices and decide, instead, to issue directions to the merger parties, including imposing financial penalties. The CAB made clear that this was open to CCCS even if the commitments offered by the merger parties are in fact sufficient to remedy or prevent any SLC arising from the merger.

5. The CAB’s decision can be found here.

6. “The CAB’s decision affirms the key findings made by CCCS in the Infringement Decision and reinforces the message that mergers that substantially lessen competition in Singapore are prohibited”, CCCS Chief Executive Sia Aik Kor said. “Singapore’s voluntary notification merger regime aims to strike a balance between safeguarding competition and being pro-business. While merger parties may perform a self-assessment to determine if their merger would lead to a SLC, they should apply to CCCS for guidance or a decision if they have concerns or are unsure as to whether their merger may result in a SLC. Where merger parties choose to implement their merger without first notifying and obtaining the necessary clearances from CCCS despite potential competition concerns, they bear the risk of infringing section 54 of the Competition Act. Should CCCS have reasonable grounds to suspect that an anti-competitive merger has been completed or is anticipated, it is empowered to investigate and take appropriate enforcement action.”

Read the full media release here.