Myanmar’s Hello Cabs sues Grab for unfair business practices

Myanmar’s home-grown app-based ride-hailing brand Hello Cabs has sued Grab, Southeast Asia’s leading transport booking service, under the Competition law.

A case was filed at the Padauk Chaung police station in July 2017 and it is still pending.

Aung Win, managing director Dagon Logistics Co Ltd, which owns Hello Cabs, claims Grab had used confidential business-related information it provided without its consent.

The two firms had reportedly entered into a relationship in September 2016 on an offer from Hello Cabs to Grab for business cooperation. Win said, upon the offer, the two managed to sign a non-disclosure agreement by the next month, followed by Hello Cabs providing their information relating to strategic plans and market expansion.

However, since signing the contract, Grab had stopped communication and it was only in April 2017 that they decided to enter the Myanmar market by themselves, Dragon Logistics alleged.

Dagon Logistics is a joint venture between Yangon-based Strategic Development International Holdings Co Ltd, Singapore’s GAP VC and Yaung Ni Oo Co Ltd. Win also leads Yaung Ni Oo, which had long been operating the traditional taxi business. The firm entered the technology-based metering taxi service with about 130 cars in early 2015.

“The main point is when entering Myanmar, the market experience is the major driver. If the documents are received but (they) decided not to work (together), they should be returned or informed. We did not get any response on a follow-up,” said Win, claiming that Grab had referenced all the market information of Hello Cabs’ before entering the market.

However, Grab said, there was no basis for the allegation and they were collaborating fully with the authorities on the matter.

“Grab does not engage in anti-competitive practices and believes in operating its business based on market forces. This approach extends to our dynamic pricing model for GrabTaxi rides, whereby fares fluctuate according to real-time market demand. We encourage all ride-hailing companies to strive to provide the best user experience for their customers. We have no further comments on the matter as it is being handled by the appropriate authorities,” Grab said, in repose to a query from DEALSTREETASIA.

The Competition Law, enacted in February 2015, talks about breach of practices related to business information. This includes the act of deceiving a person with an obligation to maintain secrets or abusing the confidence of such person in accessing, collecting or revealing of business secrets and information related to such secrets. If breached, a two-year sentence or K10 million or both can be enforced.

Competition between the ride-hailing apps in Yangon – Hello Cabs, Oway Ride, Grab and Uber – had been mounting since the two foreign firms’ entrance in Myanmar in early 2017.

At the same time, the government is preparing to set new regulations in this space, hoping to employ ‘a level playing field’ for the technology-based taxi services in Myanmar.

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