The National Restaurant Association of India (NRAI) has gone to the Competition Commission of India to resolve issues with food aggregators Zomato and Swiggy.
On July 1, NRAI filed an information with the CCI highlighting anti-competitive practices by Zomato and Swiggy, which have an appreciable adverse effect on competition, the association said in a statement.
The main issues highlighted by the association are bundling of services, data masking and exorbitant commission charged, price parity agreements, deep discounting, including forcing the restaurant partners to give discounts to maintain appropriate listing, exclusivity of listed restaurants, and violation of platform neutrality, vertical integration and lack of transparency on the platforms.
“We have been in constant dialogue with the food service aggregators over the last 15-18 months to resolve critical issues impacting the sector. However, despite all our efforts, we have unfortunately not been able to resolve them with the aggregators. The needle hasn’t moved much on these issues. We have therefore approached the CCI now to look into the matter and investigate them thoroughly," said Anurag Katriar, President of NRAI.
Since 2018 onwards, the restaurants have been highlighting several issues in their dealing with the marketplace platforms, Swiggy and Zomato, NRAI said. When these marketplace platforms started, they had certain advantages, however, over a period, their business practices started hurting the food and beverage (F&B) industry massively. There have been multiple discussions and deliberations between NRAI and restaurant aggregators, but no amicable solution was reached, it added.
As a part of the e-commerce study conducted by the CCI under their advocacy measures, NRAI also sent their recommendations to the CCI and participated in various workshops conducted under the aegis of CCI highlighting various practices which are conducted by Swiggy and Zomato. NRAI played a leading role in highlighting the concerns of the restaurants to the CCI in the workshops.
NRAI said during the pandemic, the magnitude of anti-competitive practices of Zomato and Swiggy have increased manifold and despite many discussions with them, "these deep funded marketplace platforms are not interested in alleviating the concerns of the restaurants. In fact, during the pandemic, due to onerous terms imposed, a lot of our partners had to shut shop".
“We are committed to the cause of our partners, and we will put our best efforts with the CCI to ensure that the practices of these marketplace platforms are aligned to the benefit of the entire F&B industry,” said Katriar.
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