Millions in Fines for Delivery Hero and Glovo Over Illegal Cartel Agreements
Delivery Hero Faces Million-Dollar Penalty Due to Cartel Infraction
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In a historic move, the EU has imposed hefty fines on Delivery Hero and its Spanish subsidiary Glovo, totaling €329 million, for their involvement in an illegal cartel. This marks the first time the Commission has penalized companies for anti-competitive employment practices.
Delivery Hero's FineDelivery Hero, a food delivery service, was hit with a final fine of approximately €223 million for their role in the unlawful agreements.
Glovo's FineGlovo, another food delivery company, was fined around €106 million.
Cartel ActivitiesThe illicit agreements included fixing prices, coordinating strategies, and deciding on regional activities. In addition, the companies agreed not to poach each other's employees and colluded through emails and WhatsApp messages, according to the EU Commission.
Cooperation and Reduction in FinesBoth companies cooperated with the Commission throughout the investigation, resulting in a 10% reduction in their respective fines.
Impacts on the Labor MarketThe EU Commission's Vice-President Teresa Ribera stated that this decision aims to foster a fair labor market, preventing employers from colluding to limit job opportunities.
The Investigation ProcessThe Commission carried out unannounced inspections at Delivery Hero in Berlin and Glovo in Barcelona in November 2023 as part of the ongoing investigation.
Acquisition and Timeline of the CartelDelivery Hero acquired a minority stake in Glovo in July 2018 and gained full control in July 2022. The anti-competitive agreements took place before the acquisition. Both companies have acknowledged their involvement in the cartel.
Precedent and Legal BasisThis case sets a precedent as the first time the EU has addressed such labor market agreements under antitrust rules. The infringement falls under Article 101 of the Treaty on the Functioning of the European Union and Article 53 of the EEA Agreement.
Sources: ntv.de, jwu/dpa
- Delivery Hero
- EU Commission
- Antitrust Law
- Fine
- MDax Company
- Enrichment Data: ### Key Details
- Total Fine: €329 million
- Breakdown: Delivery Hero was fined €223.29 million, while Glovo faced a fine of approximately €105.73 million.
### Cartel Circumstances - Duration: The cartel operated from July 2018 to July 2022. - Facilitating Factor: Delivery Hero's initial minority stake in Glovo provided access to sensitive information and influence over Glovo's decision-making processes.
### Legal Significance - Precedent: This case is the first enforcement of EU competition rules concerning labor market agreements. - Legal Basis: The infringement falls under Article 101 of the Treaty on the Functioning of the European Union and Article 53 of the EEA Agreement.
In light of the EU's historic fine on Delivery Hero and Glovo for their illegal cartel agreements, it's crucial that companies adhere to community and employment policies, avoiding collusion which could impact the labor market, especially in the context of vocational training programs. As technology advances and entertainment industries evolve, it's essential for businesses to understand the repercussions of antitrust law violation, as demonstrated by Delivery Hero and Glovo's fines, totaling €329 million.
