Bhubaneswar: The online food aggregators, Zomato and Dwiggy, have landed in trouble as Competition Commission of India (CCI) has ordered an investigation into their alleged unfair business practices.
The CCI issued the order following a complaint filed by National Restaurant Association of India (NRAI) over the food delivery platforms’ dealing with restaurant partners.
Alleging that the two companies were offering their services to some brands for additional fees or rental commissions, the NRAI sought investigation by CCI. It stated that Zomato had used consumer data to build cloud kitchens while Swiggy benefited from part of sales from private labels and was thus incentivised to divert consumer traffic to them.
“Prima facie a conflict of interest situation has arisen in the present case, both with regard to Swiggy as well as Zomato because of the presence of commercial interest in the downstream market, which may come in the way of them acting as neutral platforms,” News18 quoted the Commission as saying in the order.
Stating that a detailed scrutiny into its impact on overall competition between the restaurant partners vis-à-vis the private brands/entities which the platforms may be incentivised to favour is warranted, the Commission directed its director general to investigate and file the report within 60 days.
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