End the Grab ‘monopoly’, say PKR leaders
By Jason Thomas, Free Malaysia Today (29 March 2021) PETALING JAYA: The country’s antitrust laws need to be reviewed in light of “monopolistic” practices by companies such as Grab, two PKR MPs said, with one even suggesting that the multibillion-dollar start-up should be broken up. Speaking at a webinar today, Subang MP Wong Chen and Permatang Pauh MP Nurul Izzah Anwar said that while they appreciated the impact that platforms such as Grab have had in boosting the gig economy, they were concerned about the company’s dominance. Wong said he was aware that companies such as Grab were able to capitalise on their first-mover advantage to create strong brand recognition and customer loyalty, but felt that the government should consider the dangers of monopoly.
Starting off as a ride-hailing firm in 2012, Grab has since diversified into digital payments and food delivery services and is now Southeast Asia’s most valuable start-up worth more than US$16 billion. It acquired the earlier ride-hailing firm Uber’s Southeast Asian operations in 2018. “I understand the first-mover advantage. But after a few years, you really have to think ‘If they have dominated 70%, 80% of the market … That is monopolistic.’ That cannot be allowed to happen,” Wong said during a webinar he hosted titled Policy Monday: Labour Market Trends – Gig Economy.
“While we admire first-mover advantage, innovation and all that kind of thing … After some time, the government must come in after maybe five, 10 years and look at the landscape where one giant dominates the entire thing and say ‘No, we have to break it’.” In 2019, the Malaysia Competition Commission (MyCC) proposed a fine of RM86.77 million for Grab for allegedly abusive transit media practices – with Grab, alongside subsidiaries Grabcar Sdn Bhd and Myteksi Sdn Bhd, going to court to challenge the proposal.
MyCC proposed the fine after Grab allegedly violated the Competition Act 2010 by imposing restrictive clauses on its drivers, with the company stating then that MyCC does not have the jurisdiction to impose such a penalty. Grabcar, meanwhile, was sued for RM100 million by the Malaysian Association of Taxi, Rental Car, Limousine and Airport Taxi in January for allegedly creating unfair competition and denying its 10,000 members their livelihood.
Grab and its business partner have also run afoul of Indonesia’s antitrust watchdog, which announced more than US$3 million in fines last July after finding them guilty of breaking anti-monopoly laws. “There are so many studies to showcase. When you’re talking about (antitrust) regulations, it’s not just Malaysians that are concerned,” said Nurul Izzah.
“I’m very supportive of Grab, but we also need to be cognisant of the limitations and monopolistic tendencies … ,” she said, adding that there were around 140 platforms providing gig and freelance opportunities in Malaysia as of last August.