A SoftBank-led consortium has agreed to invest about $9 billion, or close to Rs 57,500 crore, in Uber Inc in a transaction that could have ramifications in India, a critical market for both entities. SoftBank also owns an approximate of 30% shares of Ola. A local cab operator in India, Meru Cabs, alleges that these investments amount to furthering monopolies in the country. In its formal complaint, Meru alleged that the aggregators were disrupting the market by putting in huge sums of foreign investor money, and also revealed that it had filed four different complaints with the competition watchdog. Meru also said that this recent development will further strengthen its case.
However, legal experts opine that as long as Uber and Ola continue to compete with each other, there wouldn’t be a problem. The possibility of a problem arising under the competition regime is if these two major cab-operators collaborate. Experts hence fail to see any substance in Meru’s case.
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