On 10 November 2023, the Competition Commission (“Commission”) published a new proposed commitment (“New Commitment”) from online food delivery platform Deliveroo Hong Kong Limited (“Deliveroo”) in relation to certain terms in its respective agreements with partnering restaurants in Hong Kong.
In June 2023, the Commission conducted a consultation (“First Consultation”) on the proposed commitments offered under section 60 of the Competition Ordinance (Cap. 619) ("Ordinance") by Deliveroo and another food delivery platform, Delivery Hero Food Hong Kong Limited (“Foodpanda”). The proposed commitments were offered to address the Commission’s concerns on the Breach of Exclusivity Provisions, Price Restriction Provisions and Tying Provisions in Deliveroo’s and Foodpanda’s respective agreements with partnering restaurants. Furthermore, Deliveroo and Foodpanda had offered not to apply the Exclusive Terms against online food delivery platforms with a market share of 10% or less in Hong Kong.
In September 2023, following the First Consultation, Deliveroo notified the Commission that it was submitting a revised proposed commitment and withdrawing the previous proposed commitment which had undergone the First Consultation.
The New Commitment proposed by Deliveroo largely mirrors its proposed commitment that underwent the First Consultation, except for the key change of excluding restaurants partnering with Deliveroo under Profit Guarantee Terms1 or Outlet Expansion Terms2 from the scope of the New Commitment3.
In accordance with the procedure set out in section 2, Schedule 2 of the Ordinance, the Commission invites interested parties to submit representations in writing on the New Commitment.
The Commission has published the following documents:
For a copy of the press release, click here.
Further details on how to submit a representation to the Commission are outlined in the above Notice issued under section 2, Schedule 2 of the Ordinance of the proposed commitments.
Representations should be submitted by 18:00 on 24 November 2023.
1 Under the Profit Guarantee Terms, Deliveroo guarantees that a restaurant will receive a target amount of gross food value for the sale of food and/or beverages on Deliveroo's platform for the purpose of facilitating investment in commercial initiatives by Deliveroo and the restaurant.
2 Under the Outlet Expansion Terms, Deliveroo pays a certain amount to a restaurant for the purposes of meeting such restaurant's capital expenditure needs, including but not limited to setting up new restaurant location(s), or expanding its existing restaurant venues, of that restaurant.
3 These exclusions are in line with Foodpanda's proposed commitment that had undergone the First Consultation.