Swiggy and Zomato are being targeted for ‘misusing dominant position’ in a petition filed with India’s competition watchdog


  • Food delivery platforms — including Zomato, Swiggy, UberEats and Foodpanda — seem to be in trouble over deep discounting and alleged ‘misuse of dominant positions’.
  • Over 500 small and mid-sized restaurants filed a petition to the Competition Commission of India (CCI) and Prime Minister’s Office (PMO) urging them to put a halt to the unsustainable pricing standards by online food aggregators.
  • While Uber eats and Foodpanda did not respond to the petition, Zomato and Swiggy have strongly denied the allegations.
After Flipkart and Amazon, online food delivery platforms are in trouble over deep discounting and internal sourcing. In a petition addressed to the Competition Commission of India (CCI) and Prime Minister’s Office (PMO), over 500 small and mid-sized restaurants have complained about the food delivery companies — including Zomato, Swiggy, UberEats and Foodpanda — ‘misusing their dominant position’.

The small restaurants are urging India’s competition watchdog to put a halt to the unsustainable pricing standards by online food aggregators as well their deep discounting practices. They claim that it’s diverting consumer traffic away from them and to these online platforms.

The petition also accused the food companies of using in-house kitchens, which has been another thorn in the side of local restaurant businesses.

Same, same but different

Unlike the allegations against e-commerce giants like Amazon and Flipkart, the food aggregators are barred from foreign direct investment (FDI). However, the CCI will carefully examine the exploitative activities according to an official from the National Restaurant Association of India (NRAI).

He added that a roundtable meeting with the food aggregators has been scheduled for next week that will address the issues put forward in the petition.

While UberEats and Foodpanda did not respond to the petition, Zomato and Swiggy have reportedly denied the allegations.

According to both companies, discounts are just a way to attract customers and encourage participation. In fact, the partner restaurants — the same people issuing the complaint — can also engage in the discount campaigns as per the Zomato spokesperson.

Swiggy defended its actions by stating that it has been fair to the restaurant community and nearly doubled the restaurant partners on its platform, thereby contributing to their business rather than taking away from it.

The petition to the CCI is only the most recent of obstacles that the online food delivery platforms have had to face. They are already being audited by the Food Safety and Standards Authority of India (FSSAI) for food safety and quality standards.

See also:
India’s food regulator has kicked off the new year with a set of new food standards

For Indian startups, 2018 has been a year of bouncing back as venture capital funding doubles

The Indian government may revisit plans to curb e-commerce discounts: Report
{{}}
Subscribe to whatsappSubscribe to whatsapp
Add Comment()
Comments ()
X
Sort By:
Be the first one to comment.
We have sent you a verification email. This comment will be published once verification is done.