Sherpa’s, a bilingual food delivery service popular with China expats, has been fined 1.16 million RMB by Shanghai’s market watchdog. The bilingual platform had been forcing partner restaurants to sign exclusivity agreements, unfairly compromising both the partners' competitiveness and that of other food delivery platforms, it was revealed on Monday.
Source: Davey Gravy
Shanghai Municipal Administration for Market Regulation said Sherpa’s, which operates in Shanghai, Beijing and Suzhou, violated antitrust laws and abused its dominant position in the English-language delivery market by restricting its partners from trading with others without justification.
An investigation was launched in June 2019 to look at the company's actions since January 2017. They found Sherpa’s forced its partner restaurants to sign an agreement not to cooperate with rival platforms. Those who did not sign were removed from the app.
The authorities found Sherpa’s action seriously weakened the competitiveness of its rivals and damaged the interests of both the merchants and consumers who used the platform. Such behavior was a violation of the company’s dominant market position and went against China’s anti-monopoly laws, the ruling said.
In December, the authorities decided to punish Sherpa’s to the tune of 1.16 million RMB, 3 percent of the company’s 2018 sales. In an announcement on Monday, Sherpa’s said it had cooperated with the investigation, accepted the penalty and had been working to rectify its wrongs since November 2019.
The news comes after Chinese e-commerce giant Alibaba was last week issued a rather more hefty 18.23 billion RMB fine, also to violating anti-monopoly laws.
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Keywords: China expats Sherpa’s fine
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Sherpa's actions secured a large number of eatery and catering business resources in the market, seriously hindering competition and infringing on the rights and interests of consumers and other businesses, the administration said. The fine imposed was based on three percent of the company's turnover in 2018.
Apr 15, 2021 10:03 Report Abuse
The Shanghai market regulator expressed its resolution to strengthen the enforcement of anti-monopoly laws in the field of platform economy, further maintain market order with fair competition, create a sound legal and business environment, and promote the healthy and sustainable development of the platform economy under the direction of the State Administration for Market Regulation.
Apr 14, 2021 10:02 Report Abuse