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No Domino’s Pizza on Zomato, Swiggy? You know what the company said MIGMG News

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Domino’s Pizza India franchise may stop taking orders on popular food delivery apps Zomato and Swiggy. The disclosure was made by Domino’s holding company Jubilant FoodWorks in a confidential filing with the Competition Commission of India (CCI).

The company, according to a Reuters report, said in a letter to CCI on July 19, “In the event of an increase in commission rates, Jubilant will consider shifting more of its business from online restaurant platforms to an in-house ordering system.”

CCI has sought responses from Domino’s India franchise and several other restaurants as part of an investigation into alleged anti-competitive practices from Zomato and Swiggy. As part of the response, Domino’s India also said that during the month of July, about 27 percent of its business in India was created from online platforms, including a mobile app and website.

CCI launched an investigation in April into Zomato and Swiggy after the National Restaurant Association of India (NRAI) alleged the apps had preferential treatment, exorbitant commissions and other anti-competitive practices.

The restaurant authority also claimed that commissions charged by Zomato and Swiggy were in the 20-30 percent range, which was “unworkable”.

According to a Reuters report, a senior industry executive with direct knowledge, who asked not to be named, said Zomato and Swiggy’s commissions were a concern for Domino’s and many other restaurants. “If commissions are increased further, it will lead to corporate earnings pressure and will simply be passed on to consumers.”

CCI probe at Zomato, Swiggy

CCI in April ordered an investigation into the alleged unfair trade practices of food delivery platforms Zomato and Swiggy, after NRAI raised concerns about the platforms’ dealings with restaurant partners. It claimed that the companies offered their facilities to some brands in return for additional fees or rental commissions.

The US Securities and Exchange Commission (NRAI) has urged the Competition Commission to investigate companies for breaching platform neutrality by prioritizing exclusive contractors. It also claimed that Zomato used consumer data to build cloud kitchens.

In its order, the competition watchdog said, “The Committee is of the view that a conflict of interest has arisen prima facie in the present case, both with respect to Swiggy as well as Zomato, because of a commercial interest in the downstream market, which may get in the way of them serving as neutral platforms.”

In response, Zomato said in a regulatory filing that it will make clear to the competition watchdog that it abides by the relevant laws and said it intends to “immediately comply with any recommendations made to us by the Honorable Committee… We will continue to work closely with the Honorable Committee to assist them in their investigations and to explain to the regulator why All our practices comply with competition laws and do not have any negative impact on competition in India.”

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