CCI probe on Zomato and Swiggy: Competition Commission of India has ordered investigation against two of the country’s biggest online food delivery chains Zomato and Swiggy. There are several reasons behind the investigation, including late payments and unreasonable prices. Apart from this, the working style of Zomato and Swiggy is also under question which will be thoroughly investigated.
The National Restaurant Association of India had filed a complaint against Swiggy and Zomato in July last year with the Competition Commission of India. The commission had said that prima facie there appears to be a collision of hits between the two. CCI has said regarding the investigation that both Zomato and Swiggy are the largest food delivery chains in the country, which act as a platform between the customer and the restaurant. Both companies have a strong hold on the market, so they can have an adverse effect and affect the level of business opportunity.
The commission said that in the preliminary investigation, it has been found that both the companies give more priority to those restaurants where they either have a stake or have a partnership. The CCI said that such things can affect market competition which will have very bad effects. Zomato and Swiggy’s agreements include a price parity clause, according to which restaurants that are partners of the company cannot sell food at higher discounts or lower prices on their own or through any other channel. This is against the sheer market competition.