No PCC approval needed for Grab acquisition of Move It

MANILA, Philippines — The Philippine Competition Commission (PCC) said Grab Philippines’ acquisition of Move It does not require its approval as the transaction did not breach the threshold for compulsory notification.

In a statement yesterday, PCC OIC chairperson Johannes Bernabe said the parties do not need to wait for the commission’s approval to consummate the transaction.

“Publicly available information suggests that the transaction was entered into by the parties when the P50 billion notification thresholds under Republic Act 11494 or the Bayanihan to Heal as One Act was in effect,”Bernabe said.

Under the Bayanihan 2, which came into effect in September 2020, mergers and acquisitions with transaction values below P50 billion are exempt from the compulsory notification with PCC within two years from the effectivity of the law. This expired last month.

Bernabe said the publicly announced size of the transaction seems not to have breached the thresholds under the Bayanihan Law.

“However, the PCC may still launch a motu proprio review of the transaction if it finds reasonable grounds to believe that the deal will result in substantial lessening of competition in the relevant markets,”Bernabe said.

In August, Grab Philippines bought out Move It, in a bid to increase the latter’s rider fleet.

Grab also said earlier that it no longer submitted the transaction to the PCC for review, assuring that the merger amounts to below P1 billion. However, no exact amount was disclosed to the public during the announcement of the buyout.

Despite the acquisition, Grab said Move It would operate separately from the ride-hailing giant, as integrating them would require regulatory approval.

Bernabe said transactions in digital markets are often characterized by small tangible assets that fail to meet the triggers for mandatory review.

“Their importance and utility to consumers, however, rank high in the priorities of the commission to merit steadfast monitoring,”he said.

Meanwhile, Bernabe said the new acquisition by Grab would not affect the company’s existing legal commitments to the PCC relating to its takeover of Uber.

The PCC earlier expressed its support in amending the Land Transportation and Traffic Code to allow two-wheeled vehicles as a mode of public transportation.

“Notwithstanding any comprehensive competition review, the commission considers the availability of motorcycle taxis and future expansion for the entry of more players as an indicator of an emerging market offering additional public transport options for commuters,”Bernabe said.

The agency stressed that for concerns relating to passenger safety, accreditation, and eventual franchising of motorcycle taxis, it defers to the Department of Transportation, the Land Transportation Office and the Land Transportation Franchising and Regulatory Board.