CCI states Zomato, Swiggy violated antitrust law
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New Delhi: Food delivery giants Zomato and Swiggy, which are supported by SoftBank, have been found to have broken competition laws, according to an examination conducted by India's anti-trust authority. Reports claim that documents from the Competition Commission of India (CCI) show that several restaurant chains featured on their platforms have received preferential treatment as a result of their business practices.
According to reports, Zomato has entered into "exclusivity contracts" with its partners, providing them with exclusive listings in exchange for lower commission rates. In a similar vein, Swiggy has been shown to ensure business growth for some establishments if they list with its service.
The CCI prepared non-public documentation outlining these conclusions. The exclusive agreements between Swiggy, Zomato, and its restaurant partners impede market competitiveness, according to the CCI inquiry team.
According to these results, which Reuters analysed, these agreements limit the possibility of a more competitive market environment, the New Indian Express reported.
The restaurant groups that submitted complaints in March 2024, Swiggy, and Zomato were given access to the CCI's materials, which comply with confidentiality laws. Before this report, these findings had not been made public.
In 2022, the National Restaurant Association of India filed a complaint, which prompted an investigation into Swiggy and rival Zomato. The complaint expressed worries about the harm that food establishments were suffering as a result of the platforms' anti-competitive behaviour.
