under the pressure of Snapfood monopoly; From closing the panel to determining financial damages for restaurants
Complaining about the exclusive process of Snapfood continues the same old issue, which claims that Snapfood enters into special contracts with restaurants, where an exclusivity clause in these contracts prohibits the restaurants from cooperating with any other platform in the field of online food ordering.
In Snapfood’s special contract with restaurants, the restaurant’s fee will be lower, the restaurant can receive promotional packages, and services will be provided to it, which will improve the performance of the restaurant twice; As a result, a kind of distinction is created between restaurants with special contracts and other restaurants.
But according to the exclusive clause of these contracts, if a restaurant signs a contract with one of Snapfood’s competitors and operates on their platform, it may face the deactivation of its panel in Snapfood or be forced to pay financial damages or special facilities provided by Snapfood. be cut off
In Zomit, we talked to a number of restaurant owners who want to operate on other platforms while having a contract with Snapfood, to see how true the issue of the exclusiveness of Snapfood’s special contracts is, and what experience these restaurants have of operating on other platforms alongside Snapfood. . It should be noted that none of these restaurant owners wanted to reveal their names and their information is reserved with us.
The restaurateurs say that when there was no other platform, we had to accept the Snapfood contract with the same exclusive clause.
The owners of the five restaurants Zomit contacted confirm the existence of these exclusive conditions. Most of the restaurateurs say that they knew about the existence of this exclusive clause, but they also explain their reasons for accepting this clause. One of the restaurateurs says:
When we signed a special contract with Snapfood, we were aware of this exclusivity clause, but at that time there was no other platform that we wanted to think about cooperating with anywhere other than Snapfood and worried about the exclusivity of our contract. If there were other platforms like now, we would definitely agree with Snapfood in a different way. When there is only one platform called Snapfood for 14 years and there is no other option, it is clear that we sign the contract.
The owner of another restaurant considers the non-competition of Snapfood as the main reason for accepting the exclusive clause of this contract: “When we signed a special contract with Snap, we knew that they had this exclusive clause, but it also provided good facilities for special contracts, which increased our sales and the brand There wasn’t much else that was important for us to work with somewhere else.”
But another restaurateur, who insisted on anonymity, says, “When we signed the contract, it was not clear to us that this is an exclusive contract and that we cannot work with anywhere else but Snapfood.” Of course, being aware of this or not has made no difference in Snapfood’s treatment of them. Because the recent cooperation of this restaurant with Tapsifood has caused the panel of this restaurant to be deactivated in Snapfood:
We signed a contract with Tapsifood, but Snapfood first disabled our panel for 48 hours and then forced us to cancel our contract with Tapsifood. They did not activate the panel until our contract with Tapsi was terminated. With this deactivation, we lost about 90 to 95 orders per day.
Snapfood disabled the panels and the restaurants lost money
The owner of another restaurant has a similar experience and explains that when they signed a contract with Tapsifood, Snapfood closed and disabled their panel. According to him, this deactivation lasted for four days and after they terminated the contract with Tapsi, the panel became available. The estimated loss of this restaurant due to the suspension of its activities in Snapfood is 30 to 40 million tomans per day, because according to the owner of the restaurant, they have at least 100 to 150 invoices from Snapfood per day.
Another restaurateur says about his experience a few months ago: “We signed a contract with Fidelio about 6.5 months ago, and after that, Snap called us and said that you have a special contract with us and you must work exclusively with us. They closed our panel for about a week and said that the Snapfood panel will not be activated until Fidelio removes your restaurant from its website.
heavy damages for restaurants; From 50 million to 20 billion tomans
Deactivating the panel is not Snapfood’s only solution for dealing with restaurants that violate this exclusive clause; In this section of special contracts, financial damages are considered for the violation of this monopoly. The amount of financial damage is different for different restaurants. Depending on how many branches the restaurant has, how many customers it has and how popular the brand is, the amount of this damage is determined. For example, the owner of one of the famous restaurants that has a special contract with Snapfood says:
The damage that Snapfood has considered for us is 20 billion tomans, which is a very high figure. In the termination clause of our contract, it is also mentioned that in case of cooperation with another platform, 500 million tomans will be added to this number after the contract is signed. ….
Of course, this restaurant has not signed a contract with any other platform yet, and according to the owner of this restaurant, they are reviewing the legal procedures of this contract to see what the consequences of cooperating with another platform are for them.
The discussion of financial damages is added to the contract as an addendum, and only one copy is signed and it remains in the hands of Snapfood.
Another restaurateur declares 1 billion tomans as the amount of damages determined: “According to the contract, if we cooperate with another group, we have to pay 1 billion as a fine to Snapfood.” He adds another point about this clause of the contract: “Snapfood adds the issue of financial damages as an addendum to the contract and they don’t give us a copy of it and keep it in their own hands.” The owner of another restaurant also announced the amount of damages specified in the contract as 50 million tomans.
Another restaurateur says, “I don’t remember that they considered financial damages in our contract. As far as I remember, they wrote that if we cooperate with another group, they will take away our special facilities, such as discounts and promotions.”
Is the contract with exclusive clause and heavy financial damages legal?
In response to this question, Mohammad Jaafar Nanakar, an expert in cyber law, says that a contract that does not conflict with Sharia or the law can be executed, and there is no problem in implementing it if the parties have concluded the contract with their consent:
Contracts that are not against Sharia and against the law are valid, so Snapfood’s contract with restaurants is also valid. But according to the principle of the constitution, if someone uses his right as a means of harming others, that right is invalid and cannot be used. For example, if a business does dumping in the market or destroys the competition in the market, it is against the rules of the competition council and the case must be sent to this council and its rulings issued.
– Mohammad Jaafar Nanakar, Cyber ​​law expert
According to this legal expert, if the competition council or a competent authority such as a court determines that one of the platforms or business owners has destroyed the competition, it will invalidate the part of the contract that has exclusive meaning. After canceling this part of the contract, the restaurant can sign contracts with other platforms. But as long as no such ruling has been issued, everyone must follow that contract.
A restaurateur: This monopoly is unethical and unscrupulous
The owner of another restaurant has been in conflict with Snapfood for two weeks because of signing a contract with Tapsifood, and he says in this regard:
We are being pressured by Snapfood due to a contract we have with another platform. That is, they called me and said that we are not allowed to do this because our contract is special. Of course, they only contacted us and they haven’t closed our panel yet, but since I heard that they have deactivated the panel of several restaurants, if we are pressured again, we will have to cancel our contract with Tepsifood.
He explains that in the same phone call, Snapfood also explained to him the easy and quick way to terminate the contract with Tapsifood: “They told me to make the item “unavailable” on Tapsifood, and if they ask you why it is unavailable, say that I could not supply it. “After a few days, Tepsifood will deactivate your panel.”
Of course, this restaurateur has similar experiences from previous years: “We also had this problem in 2018, when Chillivari, Rihun and Changal were active, because of working with platforms other than Snapfood. “Snapfood had an exclusive contract with 2,000 of its top restaurants to prevent them from working with another company. This process is still going on.”
Snapfood will not convert the special contract into a regular contract to maintain its exclusivity
One of the restaurateurs whose activity was suspended on this platform due to cooperation with Snapfood’s competitor says: “During the disputes we had with Snapfood after the panel was closed, we asked them to change our contract from a special contract to a regular one so that we can work in Tepsi as well. to operate, but they did not accept even this. Their policy is that they only see a special contract with bigger customers so that they cannot work with another place, but they give this permission to smaller restaurants that have a regular contract.”
But the owners of different restaurants do not agree with the existence of such a procedure. One of them considers this practice unethical and unscrupulous because he believes that Snapfood “does not allow other companies to grow up with this exclusive process.”
Restaurateurs are against the exclusive approach and lack of competition
Another restaurateur believes in the existence of a competitive environment, and in his opinion, only with a competitive procedure, both restaurants and their customers can receive better services:
A group should not be able to create a monopoly and practice slavery. It is natural that we like to create a competitive atmosphere. With this, we can have competitive fees and the customer can use the benefits and services of different platforms. But at the moment Snapfood is more powerful and nothing can be done.
Another restaurateur also objects to this procedure and believes that every restaurant should have the right to choose the platform that offers better services and helps to increase its sales among its different platforms:
If Snapfood says that it is our business partner and takes a percentage of the number of fishes that we make, it should not hit me as a partner. What difference does it make which platform I work with? This monopoly should be removed to cooperate with wherever we wish. Different platforms give points to their customers, and I, the restaurant owner, want to use these points to increase the number of my receipts and outputs.
Another restaurant owner also says that if the platforms are strong and can help more sales, the existence of more platforms will benefit the restaurants and it will be welcomed:
If there is a collection that increases our sales, gives good options and has a good courier, we are definitely willing to work with them along with Snapfood. Therefore, I am opposed to this monopoly on special Snap contracts. But if a platform is weak and does not have good services, it cannot compete, and cooperating with such a place is also to our detriment.
Competing platforms can succeed in filing a lawsuit by providing convincing documentation about Snapfood’s monopoly
“All businesses tend to work with different options, and if it’s possible, we definitely do that.” This is a sentence that one of the restaurateurs says at the end of the conversation to emphasize the importance of competition and multiple options. An issue that is objected to by Snapfood’s competing platforms and restaurants that want to operate in the context of online food ordering.
Mohammad Jaafar Nanakar, an expert in cyber law, says that both the restaurant owner and competing platforms can file a complaint against this procedure, but he believes that: “In principle, filing a lawsuit by the platforms will be more successful because the restaurant owner is aware of the existence of this clause in the contract and it has signed
Of course, Nanakar notes that the outcome of Tapsi’s complaint against Snapfood “depends on the size of the market and the number of these types of contracts.” According to him, Tapsi or any other competing platform should provide valid documentation to prove that the competition in this market has been overshadowed. Nanakar also adds that “the process of dealing with these types of claims in the Competition Council is complicated and many different elements are checked to see if a right has been lost or not.” Therefore, we probably have to wait for the process of this case for a while before the final verdict is issued.
