The European Commission has imposed major fines on food delivery firms Delivery Hero and Glovo for engaging in anti-competitive practices, including illegal coordination and non-compete agreements, marking a landmark case in EU competition enforcement.

According to Reuters, the Commission determined that the companies colluded to distort competition in the online delivery of food, groceries, and other consumer goods. The violations occurred between July 2018 and July 2022, a period during which Delivery Hero progressively acquired a greater stake in Glovo, eventually assuming full control in 2022.

The case is especially significant because it represents the first time the European Union has sanctioned the misuse of a minority shareholding under its competition rules. Per Reuters, the Commission found that Delivery Hero used its partial ownership of Glovo to obtain sensitive information and exert undue influence over its rival, undermining fair competition.

“Of course, owning a stake in a competitor is not illegal. But it may be problematic when that stake is used to gain inside information and influence decisions in ways that can harm competition,” noted the EU’s executive vice president for competition, Teresa Ribera, in a public statement.

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The investigation also broke new ground by tackling labor market collusion — the first such enforcement in the EU. The Commission found that the two companies had agreed not to hire or poach each other’s employees, thereby limiting job mobility and opportunities for workers. “This investigation shows that competition rules aren’t just about keeping prices down,” said Ribera, emphasizing the broader impact on employment and workplace fairness.

Reuters reported that the Commission’s inquiry began with unannounced inspections at the companies’ offices in June 2022 and November 2023. Officials uncovered a coordinated strategy between the two firms to reduce rivalry, replacing competition with a structured pattern of cooperation.

In total, the companies were fined over €329 million — approximately €223 million for Delivery Hero and €106 million for Glovo. Both firms admitted to their participation in the cartel and opted for a settlement process that reduced their penalties by 10%, a mechanism available under EU law since 2008.

Source: Reuters