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Hong Kong competition authorities to probe Deliveroo
27th Jan 2022 07:55
(Sharecast News) - Hong Kong's competition authorities are to investigate Deliveroo and its local rival Foodpanda, it was announced on Thursday.
The Competition Commission said it would assess whether the two food delivery services, the city's largest, had imposed restrictive conditions on partner restaurants.
These could include requiring exclusivity, which the Commission said could discourage restaurants to partner with other food delivery platforms, and requiring partners to offer menu items at certain prices.
In a statement, the Commission noted: "If present, these requirements may have the potential effect of softening competition among online food delivery platforms, as well as hindering entry and expansion by new or smaller online food delivery platforms, depriving consumers and partner restaurants of the benefits of effective competition."
Rasul Butt, chief executive of the Commission, said: "The online food delivery industry has grown tremendously in Hong Kong in recent years, and the food delivery platforms are playing a crucial role in the daily lives of Hong Kong people, particularly with the ongoing pandemic and the need for social distancing.
"Ensuring effective competition in the market to safeguard the interests of industry players and consumers, as well as other relevant parties, is therefore of utmost importance."
The Commission has asked restaurants and other stakeholders with relevant information or concerns to comment by 11 February.
As at 1315 GMT, Deliveroo's London-listed shares were down 3% at 153.05p.
Deliveroo did not immediately respond to a request to comment.
The Competition Commission said it would assess whether the two food delivery services, the city's largest, had imposed restrictive conditions on partner restaurants.
These could include requiring exclusivity, which the Commission said could discourage restaurants to partner with other food delivery platforms, and requiring partners to offer menu items at certain prices.
In a statement, the Commission noted: "If present, these requirements may have the potential effect of softening competition among online food delivery platforms, as well as hindering entry and expansion by new or smaller online food delivery platforms, depriving consumers and partner restaurants of the benefits of effective competition."
Rasul Butt, chief executive of the Commission, said: "The online food delivery industry has grown tremendously in Hong Kong in recent years, and the food delivery platforms are playing a crucial role in the daily lives of Hong Kong people, particularly with the ongoing pandemic and the need for social distancing.
"Ensuring effective competition in the market to safeguard the interests of industry players and consumers, as well as other relevant parties, is therefore of utmost importance."
The Commission has asked restaurants and other stakeholders with relevant information or concerns to comment by 11 February.
As at 1315 GMT, Deliveroo's London-listed shares were down 3% at 153.05p.
Deliveroo did not immediately respond to a request to comment.