BusinessMirror November 30, 2019

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Saturday, November 30, 2019 Vol. 15 No. 51

P25.00 nationwide | 24 pages | 7 DAYS A WEEK

IT’S COMPLICATED G

In unique position of complying with 2 regulators, Grab Philippines explains how it ended up being fined by the Competition Commission even though it didn’t overcharge customers.

By Lorenz S. Marasigan

RAB, a tech-enabled transport platform that transformed into a super app, is firming up the disbursement process of the P5.05-million fine that the Philippine Competition Commission (PCC) slapped it with for deviating from its voluntary commitments post-Uber transaction.

transaction with Uber. When it acquired Uber last year, Grab became a virtual monopoly. For the competition watchdog to approve the merger, Grab submitted a set of voluntary commitments on pricing and service levels. However, it was found by the anti-trust body to have failed to deliver on its commitments, specifically on the pricing side. Under its voluntary commitments, Grab is allowed to increase fares for up to 22 percent

JOHN TAKAI | DREAMSTIME.COM

Within the next two months, Grab will be distributing GrabPay credits amounting between P1 and P100 to users who booked Grab rides from February to May 2019. Those who will be receiving the payouts—3 million users, according to Grab—will be notified five days before the actual disbursement. This is just part of the P23.45million fine that the PCC ordered Grab to pay for breaching pricing commitments that it voluntarily submitted to consummate its

from the average of the minimum and maximum fares before its acquisition of Uber. For instance, a GrabCar fare for a two-kilometer ride for 15 minutes on February 10, 2018, costs P100 on the minimum. It is allowed under a regulatory matrix a surge rate of up to 2X, which brings the max fare at P200. Applying the formula, Grab is only allowed to charge a maximum fare of P183 for the same ride and time on February 10, 2019. If it had breached this price level even by a centavo, then it is in violation of its commitments. The PCC found a lot. “We call that extraordinary deviations,” PCC Commissioner Johannes Bernabe said in a phone interview. “So from a matrix standpoint, Grab did not overcharge passengers, but it deviated from its commitments to the commission.” Bernabe’s clarification supports the claim of Grab that it never overcharged its users, at least based on the fare matrix approved by the Continued on a2

US presses case to defang the global economy’s trade referee

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By Bryce Baschuk Bloomberg News

IXTEEN years ago, a brash trade lawyer named Robert Lighthizer was nominated to represent the US at the World Trade Organization’s (WTO) appellate body, which officiates disputes that affect billions of dollars in commerce every year. PESO EXCHANGE RATES n US 50.7980

U.S. Trade Representative Robert Lighthizer speaks alongside President Donald Trump, as he speaks on a US beef trade deal with the European Union, in the Roosevelt Room at the White House in Washington, DC, on August 2, 2019. KEVIN DIETSCH/UPI

WTO members, however, chose a different candidate. And now Lighthizer, as the US Trade Representative in Washington, is arguing that the very dispute settlement system he nearly became a part of either needs to be drastically reformed or dismantled. The arc of Lighthizer’s rocky relationship with the WTO is hurtling toward a potentially dramatic inflection point. The pressure he and the Trump administration are applying on the WTO may, in just a few weeks, render the Geneva-

based arbiter of trade inoperative. The Trump administration, which previously threatened to block the WTO’s 2020 budget, offered members a proposal this week that would allow it to continue operating, but would hamstring the WTO’s appellate body. The US said it would back the WTO’s 197.2-million-Swiss franc ($197.6 million) budget for 2020 with the condition that no more than 100,000 francs be paid to appellate body members, an 87-percent Continued on a2

n JAPAN 0.4639 n UK 65.5802 n HK 6.4903 n CHINA 7.2209 n SINGAPORE 37.2037 n AUSTRALIA 34.3750 n EU 55.9286 n SAUDI ARABIA 13.5469

Source: BSP (November 29, 2019 )


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