New Delhi: Food delivery platforms, Zomato and Swiggy seem to be getting into a soup after a CCI probe into their alleged unfair business practices with regard to their dealings with restaurant partners.
The Competition Commission of India (CCI) order comes on a complaint filed by the National Restaurant Association of India (NRAI). The investigation wing of the watchdog – the Director General (DG) – will investigate the matter.
The CCI said that preferential treatment given to restaurant partners (RPs) that have equity or revenue interest in these platforms may create barriers for existing RPs to compete on fair terms.
The CCI has stated that “Prima facie a conflict of interest exists, requiring a detailed examination of its impact on the overall competition among RPs as well as among private brands/entities in favor of which the platform is promoted.” May go”.
Both zomato The watchdog said that and Swiggy serve as the leading intermediary platforms in the food delivery space, underscoring their market power and ability to adversely affect an even level playing field.
The perceived preferential behavior is done in various ways such as control of delivery, search ranking etc. The CCI said that it can be properly investigated only in one investigation.
CCI further stated that the price parity clause is mentioned in the agreements zomato And Swiggy points out broad restrictions where RPs are not allowed to maintain low prices or high discounts on any of its own supply channels or any other aggregator, so that the minimum price or maximum discount is maintained by the platform.
“Such price parity clauses may discourage platforms from competing on a commission basis as the RP is required to maintain the same price across all platforms and provide the same value to customers, irrespective of the commission paid to the platform. regardless of rates.
Considering that Zomato and Swiggy are the two largest platforms present in the food delivery segment, their respective agreements with such RPs are likely to have an appreciable adverse impact on the competition in the market, without earning entry barriers for the new platforms Is. No benefit to consumers, CCI said.
With PTI inputs
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