CORRECTS - EU fines Delivery Hero and Glovo combined $376M for online food delivery cartel

CORRECTS FIGURE IN HEADLINE

By Melike Pala

BRUSSELS (AA) - The European Commission fined online food delivery group Delivery Hero and its subsidiary Glovo a combined €329 million ($376 million) Monday for operating a cartel in the run-up to their merger in 2022, restricting competition across the European Economic Area.

According to a commission statement, between July 2018 and July 2022, the two companies engaged in coordinated practices that included a no-poach agreement not to hire each other’s employees, the exchange of commercially sensitive information, and the allocation of geographic markets.

The commission said these actions limited consumer choice, suppressed competition and harmed job opportunities.

Delivery Hero was fined €223 million and Glovo €105.7 million.

"It is the first time that the commission is fining companies for a no-poach agreement," said Teresa Ribera, executive vice-president of the European Commission for a Clean, Just and Competitive Transition, during a news conference in Brussels.

"This is also the first decision that shows how companies can misuse a small stake in a rival company for anti-competitive reasons, and importantly, today's decision shows once again that competition rules matter to citizens’ daily lives." she said.

Ribera emphasized that such no-poach deals act as purchasing cartels, restricting competition for labor, suppressing wages and reducing mobility.

The commission's investigation revealed that the companies also coordinated to divide national markets across the European Economic Area, avoiding overlap and limiting competition in several countries.

"I could say that today's decision shows our determination to take actions against all forms of cartels. It also shows our willingness to have an active role in this consumer-facing sector," Ribera said.

The probe was launched following unannounced inspections in 2022 and 2023 triggered by a market monitoring exercise informed by whistleblowers and national authorities.