Another day, another problem for Uber in Asia.
On Sept. 20, Bloomberg reported fresh details on the US justice department’s review of allegations that the ride-hailing giant Uber may have violated the Foreign Corrupt Practices Act (FCPA). The department appears to be looking closely at Uber’s dealings across several countries in Asia, and could open a formal criminal case under the federal anti-bribery law. The department declined to comment to Bloomberg, and did not immediately respond to Quartz’s queries.
Bloomberg reported that Uber had hired a law firm to look at company payments and interview employees. Uber declined to comment to Quartz on the matters described in the Bloomberg story.
The development comes as Uber faces an uncertain fate in many parts of Asia. One year after selling its China operations to local rival Didi, the company is now locked in a money-bleeding battle against rival Grab in Southeast Asia, and has been handicapped by regulations in Taiwan, Hong Kong, South Korea, and Japan—leaving India as a rare bright spot for Uber on the continent.
Here’s a look, by country, at the main controversies detailed by Bloomberg, and other recent problems in Asia.
In December 2014, a 25-year-old woman in New Delhi alleged that she was raped by her Uber driver, which prompted the city to temporarily ban the service. The driver was tried and sentenced to life in prison in 2015. In June this year, news surfaced that Eric Alexander, who was Uber’s Asia-Pacific head at the time of the incident, had obtained the woman’s confidential medical records as part of an apparent effort to determine if the rape was a set-up staged by its local rival. Alexander was fired this summer and the woman later sued Uber in the US. Uber’s lawyers are now looking at how the files ended up with Alexander, who declined to comment to Bloomberg.
Uber maintained an office in Jakarta located outside of the city’s zoned business districts, according to Bloomberg. When confronted by local police, an Uber employee in Indonesia allegedly paid them small bribes. These payments were filed as company expenses, and approved by Uber’s then Indonesia head, according to the report. The employee was later fired. Uber reportedly disclosed this particular incident to the US justice department when it was approached for potentially violating the FCPA.
According to the same Bloomberg report, Uber made a donation “tens of thousands” of dollars to the Malaysian Global Initiative and Creativity Centre (MaGIC), a government-affiliated startup accelerator based in Kuala Lumpur, at around the same time a Malaysian pension fund invested $30 million dollars into the ride-hailing company. When Uber announced a “partnership” with MaGIC in July 2016, it did not say that the collaboration involved money. About a year later, Malaysia legalized both Uber and Grab. The law firm Uber hired to conduct its review is examining whether or not Uber’s donation paved the way for the investment and the favorable legal environment. MaGIC didn’t immediately respond to a request for comment.
In August, the Wall Street Journal reported (paywall) that Uber had ditched its habit of having drivers use their own personal vehicles, and purchased fleets of cars to lease out to drivers. Yet at least 1,000 of these vehicles had known defects. Uber did not notify drivers of their faulty cars until one such vehicle caught fire. At the time, Uber commented that “took swift action” to fix the vehicles in question. The company has yet to face legal action from Singapore’s Land Transport Authority or its drivers, though it has filed a lawsuit against Sunrita, the Singapore-based dealer that it says sold it the defective cars. Sunrita told the Wall Street Journal it had supplied Uber with the required parts to fixed the cars when asked. Uber told the Journal it has fixed the faulty cars and added safety measures.
In Taiwan, in June, 33 credit-card issuing banks were ordered by the country’s enforcement agency to withold payments made to Uber over unpaid back taxes and fines amounting to $34 million. The Taiwanese enforcement move came after Uber’s return to Taiwan in April with a change to its model there—it’s now partnering with licensed car rental companies. Earlier this year it had ceased operating there after a dispute over how it should be regulated that saw Taiwan change its rules so it could levy heavy fines against it for operating an illegal service.
Meanwhile, in Hong Kong, where getting a taxi license is a challenging business, and the licenses are worth billions, a court convicted five Uber drivers for driving without the legal permits and without third-party insurance. The drivers are appealing and Uber said later it had addressed the insurance issue. In May, nearly two dozen Uber drivers were arrested in an undercover police operation on similar grounds.