Brussels (The Brussels Morning Newspaper) – The EU Commission launched an investigation to distinguish whether online food-delivery businesses Delivery Hero and Glovo employed anti-competitive practices.
Why is the EU investigating Delivery Hero and Glovo?
The European Commission has extended a formal antitrust investigation to consider whether Delivery Hero and Glovo have violated EU competition rules by partaking in a cartel in the business of online ordering and delivery of food, grocery and other daily consumer goods in the European Economic Area (‘EEA’).
What concerns does the EU Commission have?
Delivery Hero and Glovo are two of the biggest food delivery businesses in Europe. From July 2018, Delivery Hero maintained a minority share in Glovo, and in July 2022 it received its sole control.
The EU Commission is concerned that, before the appropriation, Delivery Hero and Glovo may have assigned geographic markets and shared commercially liable information (e.g., on commercial strategies, costs, capacity, costs, and product characteristics). The EU Commission is also concerned that the groups may have decided not to poach each other’s workers. These practices could have been relieved by Delivery Hero’s minority share in Glovo.
The EU Commission will now conduct its in-depth investigation as a case of priority.
When were the unannounced reviews conducted?
In June 2022 and November 2023, the EU Commission carried out unannounced reviews at the premises of Delivery Hero and Glovo, as part of its ambitious inquiry into possible cooperation in the food delivery sector.
What is the scope of Delivery Hero’s and Glovo’operations?
Delivery Hero, located in Germany, is a company engaged in the food ordering and delivery business. It is currently attending in more than 70 countries worldwide and partners with more than 500,000 restaurants. Delivery Hero is documented on the Frankfurt Stock ExchangeGlovo, headquartered in Spain, is a business active in the food ordering and delivery business. It is currently attending in more than 1,300 cities in 25 nations across the globe. In July 2022, Delivery Hero obtained the majority of shares in Glovo, and Glovo became Delivery Hero’s sidekick.
What is the aim of the EU Commission’s investigation?
EU Commission investigation is a component of the Commission’s actions to ensure that online food delivery and the grocery sector provide choices and reasonable prices to consumers. In a young and vibrant market such as the one at stake, anticompetitive arrangements and restrictive business practices, including cartels via market allocation, may lead to secret market consolidation, with potentially adverse effects on competition.
This investigation is also a component of the Commission’s efforts to ensure a proper labour market where employers do not conspire to limit the number and quality of opportunities for workers but talent contest. It is the foremost investigation on no-poach deals formally initiated by the Commission.
This examination is also the first by the Commission into anti-competitive arrangements that may have happened in the context of a minority shareholding by one operator in a competitor.
TFEU forbids agreements and concerted rules which may affect trade and prevent or restrict competition.
