Singapore Competition Watchdog risks being seen as unfair, protecting GLCs while punishing others

The acquisition of Kopitiam by NTUC Enterprise has been marketed as part of NTUC’s “social mission to ensure that cooked food remains affordable and accessible to Singaporeans” while the merger of Uber and Grab has been touted as harmful to competition and each company has been fined S$6.58m  and S$6.4m respectively.

While not directly similar, there is an arguable case that both scenarios can be construed as being harmful to competition. Why then have the two cases been treated so differently?

NTUC Enterprise is the holding entity and single largest shareholder of NTUC Social Enterprises, which includes NTUC Foodfare. NTUC Foodfare manages 14 foodcourts, 10 coffee shops and nine hawker centres. After acquiring Kopitiam and its subsidiaries comprising 80 outlets  (56 foodcourts, 21 coffee shops, three hawker centres and two central kitchens), NTUC Enterprise will absolutely dominate the hawker food market.

If one is to take into consideration the NTUC chain of supermarkets island wide owned by Fair Price (a sister company of NTUC Enterprise), the NTUC Group will virtually have a monopoly of the food supply industry from raw to cooked! Shouldn’t this be considered anti competition by Singapore’s competition watchdog?

If the merger between Uber and Grab is seen as having violated competition laws, why not the acquisition of Kopitiam by NTUC? Arguably, the acquisition of Kopitiam by NTUC is even more anti competitive than the union between Grab and Uber!

I accept that the union between Uber and Grab will see them dominate the ride sharing technology in Singapore. However, we have to remember that not everyone in Singapore uses these apps. There are other forms of transportation choices. But if you compare the percentage of Singaporeans that ate at Kopitiam and shopped at NTUC, with the percentage of Singaporeans who used Uber or Grab, I am very certain that the percentage of the former will be much higher!

In other words, this Kopitiam acquisition would affect many more people than the merger or Uber and Grab! Why then is is the former welcomed while the latter punished?

The Kopitiam acquisition has been marketed as a means to keep the costs of food down. However, how do we police that? Also, it is important to note that NTUC’s group of companies are a very profitable lot! With this in mind, how can we ensure that this isn’t a way to take out the competition and make more money at the expense of Singaporeans who will be left with less choice?

For the Singapore watch dog to be taken seriously, it has to play fair. It cannot let one case off carte blanche while punishing another. Otherwise it risks having a reputation of prioritising government-linked companies over others. Is this the reputation it wants to have?