A Grab bike on Ly Thuong Kiet Street in Hanoi (Photo: VNA)HCM City (VNS/VNA) - The Ho Chi MinhCity People’s Court has adjourned trial proceedings brought againstride-hailing service Grab by Vinasun taxi company, which has accused Grab of unfairbusiness practices and demanded compensation of 41.2 billion VND (1.75 millionUSD) for losses it has suffered.
The trial, which has been postponed fourprevious times, would be delayed for one more month, with the next date to beannounced soon, the court said. The two parties told the court that they wantedto adjourn to consider the matter further.
Before the trial reopened on November 30, bothVinasun and Grab had submitted requests to delay the trial but a detailed planfor discussion between the two parties was not clear, so the court decided tohold the trial.
“The lawsuit has taken a very long time andwe’re both tired. We would like to stop the trial for more discussions withVinasun to seek a way to work and develop together,” a Grab spokesperson saidat the court.
A Vinasun representative said: “Vinasun suedGrab because we would like to have a healthy business environment, but we’veagreed to have more discussions with Grab.”
Vinasun, once a dominant player in the taximarket in the south, has seen its market share gradually taken away by Uber andGrab since 2016.
About 2,700 of its taxis are idle because ofunfair competition, it said.
Grab, which acquired Uber in Vietnam earlierthis year, continues to grow in popularity as the number of smartphone users inthe country has steadily risen.
Vinasun told the court that Grab’s “illegal”operations caused losses of 41.2 billion VND in 2016 and 2017 for thetraditional taxi company.
Vinasun based its complaint on the Trade Law andthe Government Decree 37 issued in 2006 which states that the duration of totalpromotions in a year must not exceed 90 days and each promotion should not lastmore than 40 days.
The Vinasun representative said that Grab hadexploited the lack of clear regulations for software-based transportservices, and had offered “rampant” promotion deals and discounts,including “zero fee” trips, activities that could be described as similar tothe dumping of manufactured goods.
According to a survey conducted by marketresearch company Quoc Viet, 74 percent of Vinasun customers have moved to Grabdue to low fares and frequent promotions.
In addition, Vinasun said that it must complywith 13 regulations, but that Grab only has to follow three, creating unfaircompetition.
At previous trials, Grab had asked foradjournment because Cuu Long Company, which was in charge of assessing lossessuffered by Vinasun, was not represented in court.
Grab said that identifying the losses would beimportant and would affect the entire trial.
According to a report from the Ministry ofFinance, in the 2014-2017 period Grab announced losses of more than 1.7trillion VND (74 million USD) while its registered capital was only 20 billionVND (870,000 USD).
A crowd of drivers from Vinasun and Mai Linh,another well-known taxi company, waited outside the court on November 30,anxious to know the outcome of the trial.
Analysts said that online businesses like Airbnbin Vietnam could be vulnerable if Grab is eventually penalised.-VNS/VNA
The trial, which has been postponed fourprevious times, would be delayed for one more month, with the next date to beannounced soon, the court said. The two parties told the court that they wantedto adjourn to consider the matter further.
Before the trial reopened on November 30, bothVinasun and Grab had submitted requests to delay the trial but a detailed planfor discussion between the two parties was not clear, so the court decided tohold the trial.
“The lawsuit has taken a very long time andwe’re both tired. We would like to stop the trial for more discussions withVinasun to seek a way to work and develop together,” a Grab spokesperson saidat the court.
A Vinasun representative said: “Vinasun suedGrab because we would like to have a healthy business environment, but we’veagreed to have more discussions with Grab.”
Vinasun, once a dominant player in the taximarket in the south, has seen its market share gradually taken away by Uber andGrab since 2016.
About 2,700 of its taxis are idle because ofunfair competition, it said.
Grab, which acquired Uber in Vietnam earlierthis year, continues to grow in popularity as the number of smartphone users inthe country has steadily risen.
Vinasun told the court that Grab’s “illegal”operations caused losses of 41.2 billion VND in 2016 and 2017 for thetraditional taxi company.
Vinasun based its complaint on the Trade Law andthe Government Decree 37 issued in 2006 which states that the duration of totalpromotions in a year must not exceed 90 days and each promotion should not lastmore than 40 days.
The Vinasun representative said that Grab hadexploited the lack of clear regulations for software-based transportservices, and had offered “rampant” promotion deals and discounts,including “zero fee” trips, activities that could be described as similar tothe dumping of manufactured goods.
According to a survey conducted by marketresearch company Quoc Viet, 74 percent of Vinasun customers have moved to Grabdue to low fares and frequent promotions.
In addition, Vinasun said that it must complywith 13 regulations, but that Grab only has to follow three, creating unfaircompetition.
At previous trials, Grab had asked foradjournment because Cuu Long Company, which was in charge of assessing lossessuffered by Vinasun, was not represented in court.
Grab said that identifying the losses would beimportant and would affect the entire trial.
According to a report from the Ministry ofFinance, in the 2014-2017 period Grab announced losses of more than 1.7trillion VND (74 million USD) while its registered capital was only 20 billionVND (870,000 USD).
A crowd of drivers from Vinasun and Mai Linh,another well-known taxi company, waited outside the court on November 30,anxious to know the outcome of the trial.
Analysts said that online businesses like Airbnbin Vietnam could be vulnerable if Grab is eventually penalised.-VNS/VNA
VNA
