Grab may face $20m fine in Malaysia for breaching competition law

Grab may be facing a fine of about US$20.5 million as Malaysia ruled that the ride-hailing giant had abused its dominant position in the market.

Photo credit: Grab

The Malaysia Competition Commission (MyCC) said that the Singapore-based company prevented its drivers from “promoting and providing advertising services for its competitors,” according to a Reuters report.

“MyCC further notes that the restrictive clauses had the effect of distorting competition in the relevant market that is premised on multisided platforms by creating barriers to entry and expansion for Grab’s existing and future competitors,” the agency’s chairman, Iskandar Ismail, said in a news conference.

Iskandar also said that Grab had 30 working days to make its representations to MyCC before a final decision on the matter would be made.

The commission imposed a daily penalty of 15,000 ringgit starting on Thursday, which will continue to run until Grab addresses its concerns.

A Grab spokeswoman said that the company maintains its position that it had “complied fully with the Competition Act 2010,” adding that it’s set to submit its written representations by November 27.

The ride-hailing unicorn has been in this situation before. The Competition and Consumer Commission of Singapore fined Grab and erstwhile rival Uber a combined US$9.52 million after finding that their merger infringed the city-state’s antitrust regulations.

Prior to that, the Land Transportation Franchising and Regulatory Board of the Philippines slapped the company with an almost US$187,000 fine for overcharging its passengers months after the Uber-Grab deal, as Grab introduced an additional fee of 2 pesos per minute on top of its regular fares without first securing the board’s approval.