Egypt’s Competition Watchdog has once again warned Uber and Careem against their intended merger. The authority has said that they could slam a fine of up to 500 million EGP ($28 million) per infringement on each relevant person involved in the deal.
Egyptian Competition Authority, had first warned the two companies last month against a merger amid rumours about acquisition talks between themcoming after Careem raised $200 million in its latest funding round.
Chairman of the Egyptian Competition Authority, Dr. Amir Nabil in a statement said, “Uber and Careem are the only ride-hailing applications available in Egypt. Any anticompetitive interaction or harmonization of their business strategies including agreement to merge has the potential to cause serious and irrecoverable damage to Egyptian competition and consumers.”
See Also: Egypt’s Online Media, Social Media Regulation Law Now Effective
The measures were approved by board of ECA, following an investigation that found out that Uber and Careem are each other’s closest competitors in Egypt — rides and drivers both benefit substantially from their competition and these benefits will be lost if they ceased to compete. The investigation also showed that the barriers to entry and expansion in this space are high.
The two companies have also been asked to notify ECA and give it 60 working days to investigate the impact and not consummate merger unless authority approves it.
“The interim measures published today aims to safeguard the advantages of the competitive structure in such an important market and prevent any competition distortion that may inflict serious damages to consumers. The measures require Uber and Careem to notify the ECA if they intend to agree to merge, and not to consummate the merger unless and until the ECA determines they may do so,” the chairman noted.
More Tech Stories:
- Four African Start-ups to Participate at Fifth Cohort PeaceTech Accelerator
- Naspers Plans to Launch $96m Fund to Support SA Tech Start-ups
- IBM to Acquire Software Firm, Red Hat in Deal Worth $34 billion
- Paga Hits Milestone of 10 Million Customers, to Launch Cloud Payroll Business Soon
- Mastercard Partners M-KOPA Solar to Launch QR Payment Technology in Uganda
