Restaurant body approaches competition panel to resolve issues with food aggregators

Our Bureau Mumbai | Updated on July 05, 2021

NRAI alleges lack of transparency on aggregators platform

More woes for food-tech aggregators. The National Restaurant Association of India (NRAI) has approached the Competition Commission of India (CCI) for resolving issues with the food aggregators.

“Keeping the interest of restaurants in India in mind and how they have been affected by the inherently anti-competitive practices of Zomato & Swiggy, NRAI, on 1st July 2021, have filed an information with the CCI highlighting the following practices by Zomato & Swiggy, which have an appreciable adverse effect on competition,” said the apex body of Indian restaurateurs.

The government is drafting an e-commerce policy. For the same, 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 multiple practices undertaken by these marketplace platforms (Swiggy & Zomato). NRAI played a leading role in highlighting the concerns of the restaurants to the CCI in the workshops.

For over a year-and-half now, NRAI has been battling against food tech aggregators like IPO-bound Zomato and Swiggy. However, these don’t seem to be fructifying.

One of their primary concerns was deep discounting, by which “aggregators forced the restaurant partners to give discounts to maintain an appropriate listing,” NRAI said. According to the body, food tech platforms have been bundling services, masking data and charging an exorbitant commission. It further has also claimed that there are no price parity agreements.

NRAI has also alleged that the aggregators provide exclusivity of listed restaurants. It has alleged that there has been a violation of platform neutrality, vertical integration and lack of transparency on platform.

NRAI has said that during the pandemic, the magnitude of anti-competitive practices of Zomato & Swiggy have increased manifold. Despite numerous discussions with them, these deep funded marketplace platforms are not interested in alleviating the restaurants’ concern. In fact, during the pandemic, due to onerous terms imposed, many of our partners had to shut shop.

Speaking on this, Anurag Katriar, President of NRAI, commented, “We have been in constant dialogue with the foodservice aggregators over 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.

He further added that “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”.

Published on July 05, 2021

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