CCI finds Zomato and Swiggy guilty for violating competition laws

India's Competition Commission of India (CCI) has found food delivery giants Zomato and Swiggy guilty of violating competition laws, according to a report by Reuters. The investigation revealed that both companies allegedly engaged in practices favouring select restaurant partners, thereby limiting market competitiveness, according to documents cited in the report.

The investigation reportedly found that Swiggy and Zomato had respective “exclusivity contracts” with restaurants. Zomato provided these restaurants lower commissions, while Swiggy promised business growth in exchange for exclusivity. The CCI said that the partnerships “prevent the market from becoming more competitive.” The documents are not public yet.

Zomato responded to the reports in a BSE filing that the Commission had not passed any order and called it misleading. Swiggy said that the reports “confuse the investigative process with the final outcome and are misleading.” It clarified that the “enquiry and report of March 2024 is a preliminary step in an ongoing investigation by the CCI, and not a final decision as some reports suggest.” Further it said, “Swiggy is yet to receive the confidential details of the findings from the CCI for filing a response to the DG’s finding. Once Swiggy submits its response and CCI conducts a hearing on the matter, CCI will pass its decision on whether any competition law violations have occurred.”