NEW DELHI (Reuters) -India’s antitrust body found that food delivery giants Zomato and Swiggy violated competition laws, documents reveal. The investigation noted how their business practices gave unfair advantages to certain restaurants listed on their platforms. #ZomatoSwiggyAntitrust
Confidential documents from the Competition Commission of India (CCI) revealed that Zomato signed “exclusivity contracts” with some partners. In return, Zomato offered reduced commissions to these partners. Swiggy, on the other hand, made a different arrangement. It guaranteed business growth to restaurants that agreed to list exclusively on its platform.
The CCI’s investigation arm found that exclusivity deals with Swiggy and Zomato hinder market competitiveness. The inquiry started in 2022 after the National Restaurant Association of India complained about the platforms’ anti-competitive behavior.
The CCI documents are confidential and remain private. They were shared with Swiggy, Zomato, and the complainant restaurant group in March 2024. These findings have not been publicly reported until now.
Zomato declined to comment, while Swiggy and the CCI did not respond to Reuters’ inquiries. Following the report, Zomato’s shares dropped 3%, having been stable earlier.
Swiggy listed the CCI case as an “internal risk” in its IPO prospectus, warning that violations could lead to heavy penalties. The CCI report showed Swiggy ended the “Swiggy Exclusive” program in 2023 but may launch “Swiggy Grow” in smaller cities.
Swiggy and Zomato have transformed India’s food delivery market in recent years. Their platforms gained popularity as smartphone usage and online ordering boomed, connecting countless food outlets to consumers. #ZomatoSwiggyAntitrust
Implications of Zomato Swiggy Antitrust Case on Industry Practices
The CCI’s final decision on this matter is yet to be made. The investigation’s findings are expected to result in penalties or changes to the practices of both companies. These changes will likely affect how Zomato and Swiggy operate within the competitive food delivery market. As a result, this Zomato Swiggy antitrust case will have significant implications for the future of the industry and its regulatory framework.
