India’s Competition Commission of India (CCI) has found major food delivery platforms, Zomato and SoftBank-backed Swiggy, to be in breach of competition laws, with business practices that reportedly favor select restaurant partners on their platforms. The findings, disclosed in confidential CCI documents reviewed by Reuters, reveal that both Zomato and Swiggy allegedly entered exclusivity arrangements with certain restaurants, leading to unfair competition practices in India’s booming food delivery market.
According to CCI’s findings, Zomato established “exclusivity contracts” with partner restaurants, offering them lower commission rates in return for exclusive listings. Swiggy, in a similar approach, guaranteed business growth to select partners who agreed to list exclusively on its platform. The CCI’s investigation arm stated in the report that “exclusivity arrangements between Swiggy, Zomato and their respective restaurant partners prevent the market from becoming more competitive.”
The antitrust investigation, launched in 2022, came in response to complaints from the National Restaurant Association of India, which alleged that these practices significantly impacted the market and hurt food outlets. The investigation documents were reportedly shared with Zomato, Swiggy, and the National Restaurant Association in March 2024, in accordance with the CCI’s confidentiality policies.
As per the CCI’s findings, Swiggy phased out its “Swiggy Exclusive” program in 2023 but has reportedly informed investigators of plans to launch a similar program called “Swiggy Grow” targeting non-metropolitan cities. CCI’s documents further disclosed Swiggy’s approach to ranking practices, with “partner restaurants threatened that their rankings will be pushed down if they do not maintain price parity.” Zomato was similarly found to impose pricing and discount restrictions on its restaurant partners and, in some cases, reportedly enforced a “penal provision” for non-compliance.
The CCI’s report also highlighted practices by both platforms to control pricing. According to the findings, Zomato and Swiggy allegedly urged restaurant partners to maintain price parity across different platforms, directly reducing competition and limiting consumer options. The report stated, “Zomato was found to have imposed pricing and discount restrictions on restaurant partners, and in some cases included a ‘penal provision’ if the outlet failed to comply.”
Zomato declined to comment on the findings, and neither Swiggy nor CCI responded to queries from Reuters.
Following the Reuters report, shares of Zomato, which went public in 2021, saw a 3% drop. Swiggy, currently finalizing bids for its $1.4 billion IPO — expected to be India’s second largest this year — disclosed the antitrust case as one of its “internal risks” in the IPO prospectus. Swiggy stated that “any breach of the provisions of Competition Act may attract substantial monetary penalties.”
With a decision yet to be made, the CCI leadership is in the final stages of reviewing the investigation’s findings to determine if penalties or changes in business practices will be imposed. This decision, which could take several weeks, may still be contested by Zomato and Swiggy through appeals with the CCI.
Both platforms have diversified rapidly beyond food delivery into quick commerce, with services for grocery delivery in as little as 10 minutes. However, their quick commerce businesses have also drawn scrutiny. India’s largest retail distribution group recently urged the CCI to investigate Zomato, Swiggy, and rival Zepto for potential predatory pricing in quick commerce.
Zomato has achieved a market valuation of approximately $27 billion since its IPO, while Swiggy’s IPO reportedly values the platform at $11.3 billion. Macquarie Capital projects that Swiggy’s food order value in the 2024-25 fiscal year will reach $3.3 billion, roughly 25% below Zomato’s.
