Knowledge Highlights 25 May 2021

On 19 April 2021, the Court of Appeal set aside the High Court’s decision and granted leave to Grab Holdings Inc. and its subsidiaries GrabCar Sdn. Bhd. and MyTeksi Sdn. Bhd. (collectively, “Grab”) to proceed with its judicial review application against the proposed RM86.77 million fine imposed by the Malaysia Competition Commission (“MyCC”).

Previously, the High Court of Malaysia (“High Court”) had dismissed the judicial review application filed by Grab to challenge MyCC’s proposed decision, issued in October 2019, on the basis that Grab’s application was deemed to be premature given the proposed decision was not yet final. The MyCC’s proposed decision alleged that Grab had abused its dominant position in the e-hailing market by imposing a restrictive clause on its drivers which effectively prevented its drivers from promoting Grab's current and potential competitors on e-hailing platforms and in transit media advertising. The judicial review application was filed to, inter alia, challenge:

  • MyCC's approach and investigation process in making the proposed decision; and
  • the imposition of a daily penalty of RM15,000, which is to be calculated from the date of the proposed decision.

Counsels for Grab argued that the directions issued by MyCC to:

  • permanently remove the restrictive clause from the terms and conditions, supplement terms of use and code of conduct; and
  • send notifications to all of Grab’s drivers in relation to the removal of the restrictive clause via the short messaging system (SMS) for 12 consecutive weeks, commencing from the date the proposed decision was issued;

were a violation of the principles of natural justice as MyCC should not impose conditions which could lead to a daily financial penalty of RM15,000 should Grab fail to comply with the directions, before the issuance of a final decision.

The Court of Appeal held that there were merits in Grab’s appeal based on the evidence presented and there was an arguable case in the substantive stage. The Court of Appeal further directed the case to be remitted back to the High Court on 26 April 2021 and for MyCC to pay total costs of RM12,000 to Grab. 

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