Quimbo: Grab's acquisition of Move It might lead to fare surge

Marikina City 2nd district Rep. Stella Quimbo is prodding the Philippine Competition Commission (PCC) to keep a close eye on Grab Philippines' involvement in the motorcycle (MC) taxi sector, saying it could potentially lead to a surge in fare.

Marikina City 2nd district Rep. Stella Quimbo (Ellson Quismorio/ MANILA BULLETIN)

Quimbo, during a public hearing of the House Committee on Metro Manila Development Wednesday, Nov. 23, said this potential hike in cost is due to the "previous behavior" of Grab, particularly after it purchased its sole transport network vehicle service (TNVS) rival Uber in 2018.

Quimbo noted that one of the "voluntary commitments" that Grab had to comply with coming out of its Uber deal was to respond to the allegations of overcharging.

" because shortly after the acquisition of Uber by Grab, nagkaroon ng (there was an) increase in prices in that period after that acquisition," she stated during her interpellation of Anton Arcilla of the PCC Mergers and Acquisitions Office.

Arcilla, one of the resource persons in the hearing, confirmed Quimbo's statement: "Tama po, yun po yung isa sa mga dangers na nais tigilan ng PCC (Correct, that's one of the dangers that PCC wants to put a stop to)."

Grab had just recently acquired Move It, an MC taxi service. Some quarters are worried that the Grab-Move It deal might repeat the effects of the Grab-Uber acquisition.

The only difference is that, in the MC taxi sector, there are actually two bigger players in Angkas and Joyride, with Move It only controlling 5 percent of the market. Meanwhile, in the TNVS sector which involve four-wheel vehicles, Grab and Uber were the two clear dominant players up until 2018.

Quimbo, a senior vice chairperson of Committee on Appropriations, then asked Arcilla about Grab's compliance with the overcharging issue. She didn't like what she heard.

"Sa ngayon po...maaari din po itong i-confirm ng Grab--patuloy po na inaaral ng komisyon ang compliance ng Grab at humihingi po kami ng information at documents po from Grab to show compliance with the commitments that they agreed to back in 2018 (As of now...this may also be confirmed by Grab--the commission continues to study the compliance of Grab and we are asking for information and documents from Grab to show compliance with the commitments that they agreed to back in 2018)," Arcilla said.

A flabbergasted Quimbo replied: "Parang hindi ko yata matanggap na hinihintay ninyo sa regulated entity ang kanilang compliance (I don't think I can accept that you are waiting on the compliance of the regulated entity)."

She said during her time as a PCC commissioner, things were set up at the commission so that the data would be clear for the regulators to see.

Later, Arcilla would admit to the House panel that the PCC had indeed fined Grab for "price variance" or quite simply, overcharging. The lady solon said this is proof that the PCC already had "findings" on the matter.

Quimbo said the PCC must be wary of the possibility that Grab--through the strength of their "very good app" and their captured audience on TNVS--could grow Move It's measly market share into a dominant share overnight.

"That's why, in her parting shot to the PCC, the Marikina congresswoman said, "Kayo po ang kakampi ng consumers, kayo po ang tagabantay ng regulated entity (You're the ally of the consumers, you're great watchers of the regulated entity)...ang sinasabi ko po, bantayan natin ang potential dominance (what I'm saying is, let's keep an eye on the potential dominance) because we know how platform markets work.

"May danger of potential dominance at because of previous behavior, may possibility na baka magtaas ng presyo (There is a danger of potential dominance and because of previous behavior, there is a possibility of a fare hike)," she said.