The European Commission has imposed a record €329 million fine on Delivery Hero and its Spanish subsidiary Glovo, two of Europe’s largest food delivery companies, for operating an illegal cartel that stifled competition and limited job opportunities across the continent.
The Commission’s investigation revealed that between July 2018 and July 2022, Delivery Hero and Glovo secretly coordinated to avoid competing with each other in several key ways. The companies agreed not to hire each other’s employees, exchanged sensitive business information, including pricing and strategy, and divided up national markets for online food delivery across the European Economic Area (EEA).
“Cartels like this reduce choice for consumers and business partners, limit opportunities for employees, and diminish incentives to compete and innovate,” the Commission said in its statement.
The scheme began in 2018 when Delivery Hero acquired a minority stake in Glovo. What started as limited “no-hire” clauses for select staff soon expanded into a broad agreement not to recruit each other’s employees at all. The companies also regularly exchanged commercially sensitive information, sometimes over WhatsApp, allowing them to align their market strategies and avoid direct competition.
Additionally, Delivery Hero and Glovo agreed to carve up the European market, ensuring they would not compete in each other’s strongest territories and coordinating on market entries elsewhere. This arrangement lasted until Delivery Hero took full control of Glovo in July 2022.
This is the first time the European Commission has fined companies for a so-called “no-poach” labor cartel, marking a significant precedent in EU antitrust enforcement. According to EU competition chief Teresa Ribera, “These actions were enabled by the anticompetitive exploitation of Delivery Hero’s minority investment in Glovo. This is the first instance where the Commission is imposing sanctions for no-poach agreements, which hinder companies from competing for top talent and limit job opportunities for workers”.
Fines and Settlement
Delivery Hero will pay €223 million.
Glovo will pay €106 million.
Both companies admitted their misconduct and agreed to settle, earning them a 10% reduction in their fines.
