Major Vietnamese taxi company to sue ride-hailing companies for unfair competition

Ta Long Hy, deputy general director of Vinasun, takes to the field against Grab and Uber (Source: news.zing.vn)

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The company announced its intention to sue the two ride hailing companies at its annual shareholders’ meeting at the end of April. The basis, according to Hy, is that Grab and Uber are competing unfairly in terms of price.

“We are gathering evidence. We heard that besides us many companies in Hanoi and Ho Chi Minh City are joining,” he said in a recent interview with news site zing.vn.

He said that Vinasun would also propose that the government review its price management policies. “Every country has anti-dumping regulations. For example, Vietnamese pangasius imported into the US is subject to anti-dumping tariff. So why does the government not act when Uber and Grab give such low prices?”

Decree No.37/2006/ND-CP detailing the Commercial Law regarding trade promotion activities stipulated that the total duration of sales promotion programmes conducted in the form of discounts for a certain good or service shall not exceed 90 days in a year. The duration of individual sales promotion programmes must not exceed 45 days.

Moreover, traders that conduct sales promotion in different forms including discounts must send written notices with on these programmes to the departments of Industry and Trade in cities and provinces where they are to be organised at least seven working days before starting the sales promotion.

“Sometimes companies like us register and are denied permission even after a month, because the departments had to check the content, the benefits for customers, the bases, and how conflicts, if there are any, will be resolved,” Hy said. “These companies can give promotional discounts anytime during the day. They are using their financial strength to win customers.”

Hy said that either Vinasun, or employees will together start a lawsuit. The three taxi associations of the three regions of Vietnam (north, south and central) may sign a proposal to send to the Ministry of Industry and Trade to ask for an investigation of the promotion activities.

Hy said that they have to make clear the bases on which Uber and Grab offer such prices. “Second, if the price is appropriate, can they commit this price for three or five years? Or are they just killing other taxi companies to gain control of the market, then raise prices after we have all disappeared?”

Vinasun is not alone in its claim of unfair competition against Uber.

In December 2016, as reported by indiatimes.com, the Indian equivalents of Uber, Ola and Meru, have separately urged government agencies to formulate policies which will undercut the ability of US-based Uber to offer steep discounts to passengers and generous incentives to drivers.

On April 7, as reported by the Guardian, in a ruling that is subject to appeal, a court in Rome upheld a complaint filed by taxi unions and banned Uber because it contributes to unfair competition.

The court gave Uber ten days to terminate the use of its various phone applications on Italian territory, along with promotion and advertising activities. However, the ban was suspended about a week after it was implemented as the company appealed. On May 26, the ban was officially lifted.