Zomato and Swiggy Accused of Antitrust Violations by Competition Commission of India
Indian Antitrust Probe Finds Zomato and Swiggy Breached Competition Laws
An investigation by the Competition Commission of India (CCI) has concluded that food delivery giants Zomato and Swiggy engaged in practices that violated competition laws. According to confidential documents reviewed by Reuters, these companies leveraged their dominant market positions to strike deals with select restaurants, potentially stifling competition in India’s fast-growing food delivery market.
Exclusivity Contracts and Preferential Deals
The investigation revealed that Zomato entered into exclusivity agreements with restaurant partners in exchange for reduced commission rates. Similarly, Swiggy promised business growth to specific partners if they listed their services exclusively on its platform. These arrangements provided unfair advantages to certain restaurants while limiting opportunities for others, the CCI noted. By securing exclusivity, Zomato and Swiggy potentially limited consumers’ access to broader choices and hindered smaller restaurants from gaining visibility.
Impact on Market Competitiveness
The CCI’s investigative arm stated that these exclusivity practices undermined fair competition in the food delivery ecosystem. By favoring select players, Zomato and Swiggy effectively restricted other restaurants’ ability to compete on equal footing. Such practices, the report argued, prevented the market from fostering greater competition, innovation, and better pricing for consumers.
What Lies Ahead for Zomato and Swiggy?
The findings come as both companies face scrutiny over their market dominance and operational practices. If the CCI formally rules against Zomato and Swiggy, it could result in penalties or corrective measures aimed at promoting fair competition. This case also underscores the increasing regulatory focus on ensuring balanced practices within India’s rapidly evolving digital economy. For now, the spotlight remains on how these companies address the allegations and adapt their strategies to comply with regulatory expectations.
