Recently, Uber Technologies Inc. proposed to acquire the Taiwan operations of its main competitor in the food delivery sector, Foodpanda, under its delivery service brand, Uber Eats. The deal was initially expected to result in a market concentration and reshape the competitive landscape of Taiwan's food delivery platform market. However, in December 2024, the Fair Trade Commission of the Executive Yuan (“FTC”) formally rejected the merger filing. The decision was based on several factors, including excessive market concentration, a significant weakening of the bargaining power of trading counterparts, and insufficient overall economic benefits. This decision not only reflects widespread public concern over the near-monopolistic state of the food delivery platform market, but also highlights the FTC’s cautious approach toward mergers involving digital platforms.

During the review process, the FTC conducted an in-depth analysis of the four key aspects concerning the expansion of platform-based economic scale: market concentration, enterprise’s post-merger pricing power, coordinated effects (i.e., concerted action), and market efficiency. The FTC also held multiple public hearings and broadly consulted with government agencies such as the Ministry of Labor, Ministry of Transportation and Communications, and Ministry of Economic Affairs, as well as key stakeholders such as consumer advocacy groups, delivery worker unions, and food & beverage business, all of whom were able to express their opinions, and their input was incorporated into the FTC’s assessment. After several days of deliberation, the FTC ultimately concluded that if the merger were approved, it would lead to excessive market concentration or even a monopoly, as Uber Eats' market share would exceed 90%, leaving virtually no competitive pressure. This would result in unilateral market control, with high entry barriers effectively preventing new competitors from entering the market, thereby eliminating any meaningful countervailing forces.

If the only concerns were the negative impacts mentioned above, the FTC would not necessarily reject the merger. For example, in the recent case of PX Mart’s acquisition of RT-Mart, the FTC allowed the merger to proceed but imposed incidental conditions as prerequisites, restricting PX Mart’s business conduct to ensure that the overall economic benefits of the merger would outweigh its anti-competitive disadvantages. However, in this case, the FTC concluded that the conditions or commitments proposed by Uber Eats were insufficient to effectively offset the merger’s anti-competitive impact. The FTC determined that the merger would fundamentally alter the market structure by eliminating its most significant competitor, inevitably leading to price increases and a decline in service quality in the future, therefore such adverse effects could not be effectively mitigated through any feasible set of conditions.

The FTC’s rejection of Uber Eats’ proposed acquisition of Foodpanda has become a significant milestone in the application of Taiwan’s Fair Trade Act to merger reviews in the platform economy. The FTC’s decision in this case clearly responds to concerns across all sectors of society—from government agencies to delivery workers and everyday users of delivery services—regarding the risks of monopoly in the food delivery industry, and reflects a legal consciousness of protecting weaker trading parties. This decision is expected to serve as a highly valuable precedent for future large-scale platform mergers and mergers involving parties with dominant market shares, prompting competent authorities to more carefully assess the long-term impact of mergers on market competition structure and overall economic efficiency.

As the digital platform sector continues to expand and integrations among platforms become increasingly frequent, how competition laws such as the Fair Trade Act should evolve and update review tools and perspectives will be an unavoidable issue for policymakers, administrative authorities, and even the judiciary in the future. How should Taiwan’s policies strike a balance between business efficiency and fair competition? One possible approach is to draw on foreign review standards while continuously accumulating domestic case precedents, thereby establishing a stable review framework to lay the foundation for future market competition order.