Competition authority investigates Foodora and Lieferando
The Federal Competition Authority (BWB) has concluded its market investigation into online delivery platforms and, on Monday, initiated proceedings due to suspicions of abuse of a dominant market position. The investigation has been ongoing since March 2023. The authority collected data from the two largest platforms and 23 other delivery services, and surveyed approximately 2,500 catering businesses in Vienna. The result: Foodora holds a market share of around 50 to 60 percent, while Lieferando holds about 40 to 50 percent. Foodora dominates primarily in Vienna, while Lieferando leads in the rest of Austria. Wolt, which launched in 2023, is growing slowly because the barriers for new competitors are high.
Four points are being contested. First, exclusivity agreements: restaurants receive better terms if they pause their presence on competing platforms—this primarily affects well-known, high-revenue businesses. Second, narrow price parity clauses, which prohibit a restaurant from offering the same meal at a lower price on its own website. Third, unilateral contract changes without the possibility of negotiation. And fourth, penalty fees of up to ten euros, for example, for longer preparation times or rejected orders. One surveyed business described its situation as follows: "I feel like a worker rather than a partner."
Why this matters beyond the catering industry: The surveyed Viennese businesses generate an average of 25 to 30 percent of their total revenue through these platforms, and a large portion of these small establishments are run by immigrants. The Director General of the authority justifies the investigation by stating that a growing dependency of restaurants could have a negative impact on prices, the range of offerings, and the working conditions of delivery personnel. Because about a third of the businesses complained about the poor accessibility of the platforms, the BWB has also forwarded its findings to the regulatory authority KommAustria, which is to examine them under the EU Digital Services Act.
Anyone who operates a restaurant or works for a platform and is personally affected can provide information to the authority—anonymously if desired via the BWB's whistleblower system or directly by email at wettbewerb@bwb.gv.at. It is advisable to keep contracts, statements regarding penalty fees, and notifications of unilateral changes. A legal violation has not yet been established: the presumption of innocence applies. The investigations could lead to proceedings before the Cartel Court—or they could be discontinued.