[ad_1]
SINGAPORE – Restrictions on Grab’s ride-sharing service have been lifted, allowing the company to change its pricing policies and driver commission rates after a two-year freeze.
The operator is also free to charge an additional fee of approximately 30 cents for each trip in the coming months.
The Competition and Consumer Commission of Singapore (CCCS) had in September 2018 imposed a freeze on Grab’s pricing algorithm and driver’s commission rate after the company’s merger with rival Uber was found to have infringed Section 54 of the Competition Law.
The consumer watchdog said on Friday (Nov. 20) that it removed the restrictions following the introduction of a new point-to-point transportation regulatory framework.
Grab, in response to the news that the restrictions were lifted, said it is committed to maintaining its current pricing and policy structure “for at least the next six months, given the Covid-19 situation.”
But a new platform fee for its transport services will be implemented later, said Andrew Chan, managing director of transport at Grab Singapore.
“The platform fee will allow us to maintain and improve security measures, cover other relevant operational costs and ensure the well-being of our driving partners in a sustainable way.
“This introduction of a platform fee will be the only change we will make to our fees at the moment,” Chan said. More details on the rate will be announced at a later date.
He added that Grab will be prudent in its pricing structure and policies, and will offer relevant services at a competitive price.
The consumer regulator had imposed sweeping restrictions on Grab after it breached rules prohibiting mergers that could significantly reduce competition in any market here.
Grab and Uber received a combined $ 13 million fine for the merger.
Grab was also required to implement various measures to lessen the impact of the transaction on drivers and passengers, and to keep the market open to new players.
It had to make sure its drivers were free to use any transport platform and remove Grab’s exclusivity agreements with any taxi fleet in Singapore.
It also had to maintain its pre-merger pricing algorithm and driver commission rates. Uber was required to sell the Lion City Rentals vehicles to any potential competitor who made a reasonable offer based on fair market value.
Lion City Rentals was a car rental company owned by Uber.
CCCS had said in 2018 that the restrictions would be lifted if a Grab competitor succeeds in securing 30 percent or more of the total matched rides on the ride-sharing platform service for a month.
But the CCC said that the start of a new regulatory framework for the point-to-point transport sector in October this year prompted the decision to lift the restrictions.
The consumer watchdog noted that there are several other transport operators licensed under the new framework, such as Gojek and Tada Mobility.
The framework also ensures that all licensed operators cannot prevent their drivers from driving from other operators, CCCS noted.
“The regulatory framework also ensures that P2P (point-to-point) rates are transparent and clearly communicated to travelers, leaving rate levels to be determined by market forces,” he added.
“CCCS will continue to work closely with the Land Transportation Authority and the Public Transportation Council to ensure that the P2P sector remains open and competitive,” the consumer watchdog said.
The National Private Rental Vehicle Association (NPHVA) said in a Facebook post that it will continue to work with Grab on issues of driver wellness and revenue sustainability following the CCCS announcement.
He asked that any fee adjustment or commission charged be reasonable.
Meanwhile, Ms Yeo Wan Ling, director of the National Trade Union Congress (NTUC), said the union movement will support NPHVA in its discussions with Grab to balance the interests of travelers, dryers and the company.
“In the long term, we want to ensure that the livelihoods of our drivers are not adversely affected by rate changes or adjustments,” said Ms. Yeo.
[ad_2]
