The National Restaurant Association of India (NRAI) has approached the Competition Commission of India (CCI) seeking immediate relief against Zomato. According to reports from Business Standard, the restaurant body has urged the watchdog to direct Zomato to refrain from imposing exclusivity clauses and price-parity provisions while the long-running antitrust case remains pending. A senior NRAI official stated that Zomato cannot be permitted to approbate and reprobate, having represented to the Director General and the Commission that it has not enforced, discontinued, or removed the impugned practices. The request comes even though Zomato says it no longer includes exclusivity provisions in its standard agreements and removed price-parity requirements earlier this year.
The matter is scheduled to be heard by the CCI on July 22, as reported by Business Standard. In 2022, the CCI ordered a Director General investigation into Zomato and Swiggy following a complaint by the National Restaurant Association of India (NRAI), alleging anti-competitive practices in the online food delivery market. The dispute dates back to 2021, when the NRAI filed a complaint against Zomato and Swiggy, alleging that their agreements with restaurants contained several anti-competitive conditions. The probe covered allegations including platform neutrality concerns arising from cloud kitchens and private labels, price-parity clauses, exclusivity arrangements, and other vertical restraints imposed on restaurant partners.
According to sources cited by Business Standard, the DG's investigation has concluded that three categories of contractual arrangements used by Zomato—exclusivity conditions, minimum business guarantees, and wide price-parity clauses—contravened Section 3(4), read with Section 3(1), of the Competition Act, 2002. These provisions deal with vertical agreements that cause or are likely to cause an appreciable adverse effect on competition. However, the DG's conclusions are investigative findings and do not constitute the CCI's final decision on the matter. The CCI's 2022 order described such clauses as restrictions that can prevent restaurants from maintaining lower prices or offering bigger discounts on their own websites or rival platforms.
A price-parity clause requires a restaurant to keep menu prices on a delivery platform at least as attractive as those offered through other sales channels. For example, if a restaurant sells a burger for ₹250 on Zomato, it may not be allowed to offer the same burger for ₹220 on its own website, ₹230 through another delivery app, or ₹210 through WhatsApp orders. The CCI's 2022 order described such clauses as restrictions that can prevent restaurants from maintaining lower prices or offering bigger discounts on their own websites or rival platforms. The competition watchdog has said that widely drafted price-parity clauses could discourage platforms from competing through lower commissions charged to restaurants.
The NRAI argues that such restrictions reduce restaurants' ability to compete outside large food-delivery platforms. According to its complaint, price-parity provisions make it harder for restaurants to build their own ordering channels, offer exclusive discounts through direct sales, or compete through other online aggregators. Restaurants have also argued that these clauses increase their dependence on dominant food-delivery platforms and reduce pricing flexibility. The CCI has found that the issue requires detailed investigation under Section 3(4) read with Section 3(1) of the Competition Act, as such arrangements may increase entry barriers for new food-delivery platforms while offering limited benefits to consumers.
