EC Investigates ‘No-Poach’ Agreements at Food Delivery Companies

The European Commission said Tuesday (Nov. 21) that it has carried out unannounced inspections at the premises of companies involved in the online ordering and delivery of food, groceries and other consumer goods in two Member States.

These inspections are part of an investigation into potential violations of EU antitrust rules, the EC said in a Tuesday press release. The Commission’s concerns revolve around the possibility of cartels and restrictive business practices within these companies.

While the EC did not identify the companies targeted by the inspections or the countries in which they took place, Reuters reported Tuesday that the companies were German online takeaway food company Delivery Hero and its Spanish counterpart Glovo.

Delivery Hero told the media outlet that its offices in Berlin and Barcelona were inspected, while Glovo said the same of its facility in Barcelona.

The current investigation builds upon previous inspections conducted by the European Commission in 2022, according to the EC press release. Initially focused on alleged market allocations, the scope has now been extended to include additional conduct such as alleged no-poach agreements and exchanges of commercially sensitive information.

“No-poach” agreements, which involve companies refraining from hiring each other’s staff or imposing restrictions on workers providing services on rival platforms, have recently become a focal point of regulatory scrutiny, according to the Reuters report.

Unannounced inspections serve as a preliminary step in investigating suspected anticompetitive behavior, the EC press release said. The initiation of these inspections does not imply guilt on the part of the companies involved. Rather, they are a means for the European Commission to gather evidence and assess the situation further.

The duration of inquiries into anticompetitive conduct can vary depending on various factors, including the complexity of the case, cooperation from the companies under investigation and the exercise of their rights of defense, per the release.

The European Commission operates a leniency program that offers companies involved in secret cartels the opportunity to receive immunity from fines or significant reductions in fines, according to the release. This is contingent upon the companies reporting their conduct and cooperating fully with the Commission throughout the investigation.

The post EC Investigates ‘No-Poach’ Agreements at Food Delivery Companies first appeared on PYMNTS.com.