Yidao accuses Didi and Kuaidi of 'writing own rules'

China's mobile taxi-hailing app operators Didi Dache and Kuaidi Dache jointly announced their strategic merger via their Sina Weibo accounts on Feb 14, also Valentine's Day. [Photo/IC]

Beijing-based Yidao Car Rental Company claims a merger between taxi-hailing apps is against anti-monopoly law and has lodged a complaint with Chinese authorities, a report by NetEase Technology said on Monday.

According to the report, Yidao reported Didi and Kuaidi to the Ministry of Commerce's anti-monopoly bureau and the National Development and Reform Commission's price supervision and anti-monopoly bureau for contravening reporting obligations. It is seeking an investigation and asking that the merger be denied.

Yidao claims that cut-throat competition on cash coupon subsides conducted by Didi and Kuaidi, backed respectively by Chinese Internet giant Tencent Holdings Ltd and Alibaba Group Holding Ltd, has seen the two create their own marketing rules.

"If the merger succeeds, well-balanced competition in the market will be eliminated," said a spokesman for Yidao.

Before the merger, the two companies provided subsidies, such as cash coupons to both drivers and users to promote brands and attract subscribers.

Ministry of Commerce spokesman Shen Danyang said the ministry has not received any centralized declarations from interested trade operators.

Before Yidao's accusation, Tao Ran, a senior vice-president with Kuaidi told Xinhua that since the two companies' combined revenue is far lower than the standard, they are not obliged to report to the bureau.

According to Xinhua News Agency, China's anti-monopoly law states that the companies which want to merge should report to the Ministry of Commerce's anti-monopoly bureau if their combined turnover in the last fiscal year exceeded two billion yuan (about $320 million) and at least two of them reported turnover of more than 400 million yuan.