“The main competition for Uber Eats comes from Foodpanda,” Fair Trade Commission (FTC) vice-chairperson Chen Chih-min said at a briefing in Taipei, noting their combined market share would be over 90%.

“The merger would lead to far greater disadvantages from competitive restraints compared to the overall economic benefits,” he said.

Uber had aimed to complete the all-cash deal by the first half of 2025.

The acquisition would have been one of Taiwan’s largest outside of the chip industry, marking a retreat for Delivery Hero from Asia.

But the FTC earlier this month indicated its concerns about the deal and said it wanted to assess the economic impact, and Chen said today the commission held multiple public hearings and surveyed many on the island.

Despite the assurances of both companies, the FTC concluded that it would be difficult for potential rivals to enter the market.

“The combined business would lack competitive pressures, therefore increasing incentives for it to raise prices for consumers and for restaurants,” Chen said.

Uber and Delivery Hero, which couldn’t immediately be reached for comment on the regulator’s Christmas Day announcement, are the two dominant players in the market, and had previously stressed the takeover was contingent on regulatory approval.

But in their May joint announcement, the companies noted Uber had a wider selection across northern Taiwan and in major urban centres, which could complement Foodpanda’s “comparative strength” in southern Taiwan and smaller cities.

This is the second big takeover stopped by Taiwan regulators recently, after the Financial Supervisory Commission rejected CTBC Financial Holding Co’s multibillion-dollar bid for smaller rival Shin Kong Financial Holding Co.