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Competition watchdog reviews public opinion regarding possible breaches by foodpanda HK and Deliveroo HK

Competition watchdog reviews public opinion regarding possible breaches by foodpanda HK and Deliveroo HK

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Hong Kong's competition watchdog is reviewing the public opinion after its recent investigation revealed the existing policies of foodpanda Hong Kong and Deliveroo Hong Kong may harm competitions in the market and even break the law.

Chan Ka Yan, chairman of the Competition Commission told local media that the public consultation regarding whether the two food delivery platforms have breached the law has ended, and many opinions from different stakeholders have been received.

"Since there is a huge amount of comments and opinions, we are reviewing the content of the opinions. The final agreement and conclusion will be shared in due course. As to whether there should be any extra adjustments regarding the platforms' existing policies, we have been closely monitoring and reviewing the situation," Chan added.

This comes as the watchdog's recent investigation revealed the existing agreements of the two delivery platforms allow them charging restaurants a lower commission rate if they work exclusively with the respective platform, restricting and penalising restaurants for switching from exclusive partnerships to working with other platforms.

Don't miss: foodpanda HK and Deliveroo HK pledge to amend policies for restaurants over possible breaches

The existing agreements also prevent restaurants from offering lower menu prices to consumers on their own direct channels and/or on competing online platforms, said the watchdog. Moreover, the investigation found that foodpanda HK requires restaurants which use its food delivery services to also use its order-to-pickup services, whereby consumers can place an order on its platform and pick it up at the restaurant themselves.

To address the watchdog’s concerns, foodpanda HK and Deliveroo HK have each offered to amend the exclusive terms so that restaurants can partner with new and smaller platforms without losing the commercial incentives entitled to only working with the two platforms. Furthermore, they have offered to amend the Breach of Exclusivity Provisions, making it easier for restaurants to switch away from working exclusively with either foodpanda HK or Deliveroo HK and partner with other online food delivery platforms and would allow restaurants to charge lower menu prices on their own channels and other food delivery platforms. 

Related articles:
HK competition watchdog highlights harm of resale price maintenance with new campaign
HK's Competition Commission investigates price fixing allegations at Aberdeen fish market

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