Terming allegations of unfair business practices by Vietnamese taxi firm Vinasun as baseless, ride-hailing major Grab said its rival was indulging in anti-competitive practices.
“Vinasun has resorted to anti-competitive tactics and legal action as a reaction to their declining market share,” Jerry Lim, Country Head of Grab Vietnam, told DEALSTREETASIA in an interaction, adding that Grab’s operations in Vietnam have always been compliant with current rules and regulations.
Vinasun has sued Grab, claiming its “illegal operations” caused its revenues to decline. The taxi firm is seeking a compensation of VND41.2 billion ($1.8 million) for the loss in profit it alleges it suffered due to Grab in 2016 and 2017.
Vinasun’s allegations against Grab include the latter running promotions for more than 90 days in a year, not permitted under the current laws, and not registering promotions with the Industry and Trade Department as mandated. “This has caused losses to Vietnamese taxi firms, including Vinasun,” Vinasun claimed.
The opening statements of a dispute between Vinasun and Grab were heard by the People’s Court of Ho Chi Minh City on February 6. According to the latest update, the trial has been suspended until next month because of lack of evidence.
The traditional taxi firm reported that its revenue has been declining year over year. It earned VND4.25 trillion ($187 million) in revenue and VND205 billion ($89.7 million) in net profit in 2017, down 10 and 34 percent respectively compared to 2016.
Grab has contended that it only provides a technology platform that connects drivers and customers which is in line with the market mechanism and the Vietnamese government’s move towards Industrial 4.0.
Last year, Grab was caught in a similar lawsuit in Myanmar where home-grown app-based ride-hailing brand Hello Cabs had sued it under the Competition law.
Hello Cabs had claimed that Grab had used confidential business-related information it provided without its consent.
Grab today is present in more than 178 cities in eight countries: Singapore, Indonesia, the Philippines, Malaysia, Thailand, Vietnam, and Myanmar. It is one of the leaders in ride-hailing in Southeast Asia, an industry that is one of the fastest-growing internet services sectors and expected to be a $25 billion regional market by 2022.