Hong Kong: Closed consultation on proposal to accept commitments offered by "Foodpanda" and "Deliveroo" in competition investigation

On 15 June 2023, the Hong Kong Competition Commission closed its public consultation on the proposed commitments offered by the two online food delivery platforms "Foodpanda" and "Deliveroo" under section 60 of the Competition Ordinance. The Commission’s investigation revealed that Foodpanda’s and Deliveroo’s respective agreements with partnering restaurants include provisions which both companies to charge partnering restaurants a lower commission rate if they work exclusively with the respective platform (“Exclusive Terms”), restrict restaurants from switching from partnering exclusively with Foodpanda or Deliveroo to also partnering with other platforms (“Breach of Exclusivity Provisions”), prevent restaurants from offering lower menu prices to consumers on their own direct channels or competing online platforms (“Price Restriction Provisions”), and in the case of Foodpanda, require restaurants which use Foodpanda’s food delivery services to also use its order-to-pickup services, whereby consumers can place an order on Foodpanda’s platform and pick it up at the restaurant themselves (“Tying Provisions”). To settle the investigation, the two platforms have committed to amend the Exclusive Terms, to amend the Breach of Exclusivity Provisions, to remove the Price Restriction Provisions and in the case of "Foodpanda" to remove the Tying Provisions, within 90 days after the commitments enter into force. The commitments would last three years. The Competition Commission believes the proposed commitments should be accepted as they address the raised concerns.