Zomato and Swiggy delivery partners seen in this collage.
Credit: iStock Photos
Bengaluru: Quick commerce and food delivery companies Swiggy and Zomato, on Monday, denied any wrong doing and said they had not broken any laws, in light of a probe by the Competition Commission of India (CCI). In separate statements, the homegrown rivals stated that the investigation by CCI is at a preliminary stage and that it has not passed any final orders.
“The inquiry and report of March 2024 is an ongoing investigation by the CCI, and not a final decision,” Softbank-bank backed Swiggy, which is expected to be listed in the stock exchanges on Wednesday, said.
“Since the intimation of April 5, 2022, the Commission, on merits, has not passed any order. Hence, there have been no further reportable events that obligates the company to make any disclosures under Regulation 30,” Zomato said in an exchange filing on Monday.
As reported earlier, CCI’s investigative arm, the Director General (DG) office was investigating breach of competition laws by Zomato and Swiggy, on the grounds that they had been in breach of competition laws by striking exclusive arrangements with partners.
The investigation is a result of the complaint filed by National Restaurant Association (NRAI) of India about the impact on food outlets of alleged anti-competitive practices of the platforms, in 2022.
Bengaluru-based Swiggy also said that it 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,” it added.
The companies also said that they are cooperating with the commission to prove their compliance with the Competition Act. “We will continue to work closely with CCI to explain why all our practices are in compliance with the Competition Act and that they do not have any adverse effect on competition in India,” Zomato said.
Swiggy's red herring prospectus (RHP), which was made public on October 28,2024, read that there were no outstanding litigations involving the group companies, which may have a material impact.
However, it has also agreed that “any breach of the provisions of Competition Act, may attract substantial monetary penalties.”
Further, the same document also disclosed that most of its contracts are standardised and on a non-exclusive basis, Swiggy does have a few customised contracts with certain participants which might differ from its standard contracts in certain terms, including charges and tenure.
Swiggy’s initial public offering is worth Rs 11,327.45 crore. With expansion on the cards, the company also announced the appointment of Hari Kumar G as Senior Vice President and Chief Business Officer at Swiggy Instamart.