Meituan Hit With RMB 3.4 Billion Fine for Anti-Trust Violations
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The delivery and ticketing app presented restaurants with an us-or-them dilemma, asking restaurants to choose between Meituan or Eleme for delivery, in an attempt to keep restaurants loyal to its platform by essentially forcing them to offer delivery exclusively on their app. If a restaurant was using Meituan and decided to switch over to Eleme, the former would cut ties with them.
Such practices resulted in disasterous consequences for restaurants.
“I asked around to find out which platform is the most popular one for restaurants to partner with. Meituan seemed to have the largest customer base, so that's when I decided to partner with them," one restaurant owner said.
But little did the owner know at that time, he actually signed himself into an exclusive deal that didn't allow him to collaborate with any other food delivery apps at all. Later on, when his business had grown, he decided to expand delivery to Eleme, only to find he had to quickly remove his restaurant from the app as it violated the exclusive deal he had signed with Meituan.advertisement
Despite his efforts to negotiate with Meituan, the platform refused to compromise and punished the owner with a low restaurant rating on their app, making it nearly invisible for people to find out about it. In the end, the restaurant owner had to give in and chose to get off Eleme.
This Isn't a First for Meituan...
Meituan was caught for earlier monopoly attempts in July 2020, when the company forbid customers from using Alipay through the app to pay for takeout orders. But why did they do this? To understand, we first need to delve into Meituan's capital flow.
Tencent, another tech company, holds a large stake in Meituan. Alipay, on the other hand, is owned by Alibaba, which is one of Tencent's biggest competitors. It's no wonder, then, that Meituan wouldn't want users to pay through Alipay. This also extended to fierce competition between Meituan and Eleme, as Alibaba owns the latter delivery app. In the end, market regulators had to put a stop to Meituan's practices.But this apparently hasn't stopped Meituan, thus resulting in the RMB 3.4 billion, which accounts for roughly 3 percent of the company's total revenue
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Images: Weibo
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