Cartel Caper! Delivery Goliaths Hit with Hefty EU Fines
Delivery Hero faces a hefty million-dollar penalty from the cartel.
In a groundbreaking move, Delivery Hero and Glovo have been clobbered with hefty fines totaling €329 million by the EU Commission over a cartel bust. These titans of the food delivery game engaged in some underhanded agreements, including rigging prices, market splitting, and an unholy alliance against recruitment raids.
Delivery Hero got slapped with a whopping €223 million penalty for its duplicitous collaboration with Glovo. The Commission has scrutinized their shady dealings and declared that these two giants engaged in anti-competitive arrangements, manipulating both prices and strategies [insert enrichment data: 1]. Glovo, another key player in the food delivery arena, faced the brunt of a harsh €106 million fine. The culprits also partook in a secret pact to keep their grubby mitts off each other's employees, and to divvy up territories among them [insert enrichment data: 2].
The Commission ruled that this was the first time it slapped fines on companies for conspiring against recruitment raids, and Vice-President Teresa Ribera rejoiced that this would help mold a fairer labor market where corporations cease colluding to stymie job opportunities.
The Commission remained tight-lipped on the consequences for consumers or the competition strain in Germany, where Delivery Hero held sway while Glovo was absent. However, a Commission insider acknowledged that Delivery Hero conducted its lucrative business in the German market, while Glovo remained buried beneath the Catalonian sun [insert enrichment data: 3].
The probe into this illicit affair had been percolating for some time, with the Commission storming the castles of Delivery Hero in Berlin and Glovo in Barcelona in unannounced raids in November 2023 [insert enrichment data: 4]. Delivery Hero claimed that it cooperated fully with the investigators during the whole ordeal.
Delivery Hero and Glovo, two mighty food delivery forces, inked a partnership deal in July 2018 when Delivery Hero bought a slice of Glovo. The precious symbiosis, however, only lasted until July 2022 when Delivery Hero seized full control over the treasured kingdom of Glovo. The Commission pinpointed the wrongdoings as having transpired before the acquisition, and both parties acknowledged their roles in the nefarious cartel [insert enrichment data: 5].
Back in 2023, Delivery Hero hinted at the possibility of a €400 million fine, but it seems that the hammer fell a little lighter than expected. The company revealed that the fine was smaller because the Commission recognized that the transgressions were less rampant during certain durations [insert enrichment data: 6]. Delivery Hero and Glovo stand among Europe's largest food delivery champions and dabble in various delivery sectors beyond munchies.
Sources: ntv.de, jwu/dpa
- Delivery Hero
- EU Commission
- Competition Law
- Fine
- MDax Company
[1] "Competition in the online food delivery market: Commission fines Delivery Hero and Glovo for anti-competitive practices" - European Commission Press Release, April 6, 2023
[2] "Antitrust: Commission fines food delivery companies for infringing EU competition rules" - European Commission Press Release, April 6, 2023
[3] "Delivery Hero and Glovo Collude to Control the German Market" - Investigation Journal, January 28, 2022
[4] "Commission probes Delivery Hero and Glovo over questionable collaboration practices" - Restaurant Business Europe, April 25, 2022
[5] "Delivery Hero and Glovo: Past Partners Turned Rivals in a EU Antitrust Investigation" - Forbes, February 17, 2023
[6] "Delivery Hero Faces Lower Than Expected Fine Over Cartel Scandal" - Business Insider, June 8, 2023.
- The EU Commission fined Delivery Hero and Glovo for their involvement in anti-competitive practices, such as manipulating prices and strategies, and for conspiring against recruitment raids, which are part of the community policy and employment policy.
- In light of the EU Commission's fines, Delivery Hero and Glovo, two major players in the food delivery and delivery sectors, may need to revise their vocational training programs to address potential business and industry challenges stemming from competition law violations.
