Just Eat says decision to approve Deliveroo’s merger with Amazon based on “misleading” evidence

Just Eat has criticised the Competition and Markets Authority (CMA)’s decision to provisionally clear Amazon’s investment into food takeaway platform Deliveroo. In evidence submitted to the CMA, Just Eat questioned the appropriateness of this “unprecedented decision” in the current market circumstances, adding it is “concerned by the very sudden U-turn in the CMA's decision-making”.

The CMA provisionally approved the merger in April after Deliveroo submitted evidence showing it would go bust without Amazon’s investment due to the effects of Covid-19; a scenario the CMA concluded would be worse for competition.

Previously, in July 2019, the CMA had ordered the proposed merger to be paused pending an enquiry over concerns it could damage competition in the online restaurant food delivery sector.

This issue will remain in the future, according to Just Eat. It argued that Covid-19 would not cause permanent damage to Deliveroo’s business, noting that demand for deliveries of takeaway food and groceries had increased during the Covid-19 lockdown. The food delivery firm believes the decision was based on “incorrect or misleading data” and urged the CMA to be extra vigilant when weighing up the evidence to make its final decision.

It commented: “Whilst Just Eat Takeaway does not question the very serious and perturbing nature of the Covid-19 crisis, it does not believe that this creates a ‘carte blanche’ to assume permanent, irreversible negative impact on businesses, particularly those who are in the business of delivering food to people at home in circumstances that align with social distancing rules.”

In response to Just Eat’s criticism, Deliveroo said: “This investment is a key part of Deliveroo’s plan to provide an even better service to customers, riders and restaurants and, as we’re a British company, this will be a boost to the UK economy.

“The unprecedented health crisis we all face has disrupted businesses across the country. This investment will help us to overcome immediate and long-term challenges, allow us to continue to improve our service for customers, enable us to develop new innovations and offer people even greater choice.

“Everyone at Deliveroo is excited that Amazon, the most customer-obsessed and innovative company in the world, has chosen to invest in Deliveroo’s future.”

The CMA has said it will consider all submitted views on its provisional findings ahead of its final report on 11 June.