Grab's purchase of Uber's operational apparatus in Singapore last March has "led to a substantial lessening of competition" within the city-state, according to the Competition and Consumer Commission of Singapore through a provisional decision.
The commission also said the two merged ride-hailing businesses have increased their prices since the purchase went through.
Both companies have just two weeks to do something in response to the recent decision, and it could effect Uber's attempts to leave the Southeast Asian market in hopes of putting their efforts into other markets.
Grab has stated that they disagree with the commission's decision and argued that their definition of competition is too narrow.
In a statement from Grab, they say the regulator "has not taken into account the dynamic developments and intense competition going on over the past few months, from both new and incumbent taxi and ride-hailing players."
The regulator also has proposed ways to resolve the issue. But they also states that if Uber and Grab don't address the problems with competition, they may need to "unwind" the purchase and merger. The regulator also mentioned potential financial penalties.
"This provisional decision and proposed remedies are overreaching and go against Singapore's pro-innovation and pro-business regulations," Grab said, adding it "will take all appropriate steps to appeal against this decision."
When asked for a comment a spokeswoman from Uber referred to Grab's comment.
Currently, under the deal Uber receives a 27.5% portion of Grab, which is worth billions of dollars, in exchange for Uber's operations in eight Southeast Asian countries.
The purchase and merger has also been scrutinized by regulators in both Malaysia and the Philippines.
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