Monday, 16 Jul 2018
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ECONOMY

Grab defends expansion proposal in face of rejection

Updated at Thursday, 28 Jun 2018, 01:29
The Hanoitimes - After the Ministry of Transport (MoT) rejected the expansion plan of Grab Vietnam, the ride-hailing firm released a statement stating its application GrabTaxi is licensed to operate nationwide in conformity with the regulation on e-commerce.
"Unlike GrabCar, GrabTaxi was registered with the Ministry of Industry and Trade (MoIT) as an e-commerce platform. Meanwhile, the pilot program under Decision No.24 of the MoT, which restricts the business operation in five provinces is only applicable to GrabCar," said the firm in its statement. 
 
Illustration photo.
Illustration photo.
According to Grab, GrabTaxi is available in all provinces and cities across Vietnam, after having signed contracts with taxi operators licensed by local transport authorities. 

Moreover, GrabVietnam stressed its GrabTaxi service did not interfere in the operation, management and fares of taxi companies, while reaffirming its compliance with the law. "The firm always abides by the law and we do not allow GrabCar to operate outside the MoT's designated cities and provinces."

Grab Vietnam previously asked for permission to bring its service to a number of provinces and cities which are not included in the pilot program namely Ninh Thuan, Dong Thap and Gia Lai. 

The MoT, however, rejected Grab's proposal to expand its service network beyond the current five cities and provinces, including Hanoi, Ho Chi Minh City, Khanh Hoa, Da Nang and Quang Ninh. 

In early 2018, the MoT requested Grab to stop operation in three provinces namely Thua Thien - Hue, Ba Ria - Vung Tau, and Lam Dong, saying that the ride-hailing service it not permitted in those localities.

Grab on March 26 confirmed its acquisition of Uber's South-east Asia operations for an undisclosed sum, raising concern over its alleged monopoly status in the region's ride-hailing market. 

The MoIT last month considered Grab's acquisition of Uber in Vietnam a violation of the Law on Competition, arguing its combined market share after the deal exceeds 50%. 

Based on that, the Vietnam Competition Authority under the MoIT is considering launching an investigation into the acquisition, while urging Grab to provide more evidences and calculate the exact combined market share. 

Grab and Uber arrived in Vietnam in 2014 and operate both car and motorbike hailing services. The two services have been running on a trial basis since early 2016, but have been caught up in a turf war with traditional taxi drivers.
Nguyen Tung
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