Iran competition authority rules against food delivery firm
Iran’s competition authority has issued a ruling against the largest food delivery company in the country for violating antitrust laws.
The National Competition Center, also known as the Competition Council, said in a ruling issued on Sunday that Snappfood had created a monopoly in the market by signing contracts that prevented restaurants and kitchens from working with rival companies.
The ruling, which can be appealed, came in response to two complaints lodged by delivery companies Tapsifood and Zoodex, as the two have repeatedly stated in the past that they have faced problems entering the market because of Snappfood’s monopolistic activities.
Zoodex, a relatively small company, welcomed the ruling, saying it was a victory for the entire online business community in Iran.
Its defense team said that the ruling, if upheld, would force Snappfood to remove terms from its contracts that impose heavy penalties on restaurants working with rival companies.
Tapsifood, Iran's second largest food delivery company, has yet to comment on the verdict. The firm, which is like Snappfood a subsidiary of a larger ride-hailing service, started its operations in the capital Tehran last year after two years of pilot work in the cities of Mashhad and Shiraz.
Snappfood said in a statement that it would appeal the Competition Council’s ruling, adding that authorities in the country should take into consideration the huge initial investment made by the company to help expand the online food delivery market in Iran.
It said restaurants have accepted its contracts because they have benefited from the company’s unique marketing strategies.
The company had announced in early March that it had broken a record of 0.5 million successful orders per day. Its parent company Snapp had also reported a daily record of nearly 6 million trips.
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