From Food Delivery under Full Scrutiny – When Brussels takes on takeaway

As autumn sets in and Brussels braces for a darker, rainier season, ordering food delivery becomes an appealing choice for those looking to make their time indoors a little cozier. A perfect moment to wrap up blankets, coffee mugs – and the European Commission's (EC) decision on the food delivery cartel. It is the first time the EC sanctions a no-poach agreement, or more generally an antitrust infringement with regards to the labour market. It is also the first time a minority shareholding has been found to facilitate anticompetitive collusion. The cherry on top is the finding of market sharing – or perhaps, after all, the case's very raison d’être? Let's take a closer look at the case and round off with a few takeaways.

By its final decision, published on 25 July 2025, the EC imposed fines of EUR 329 million on Delivery Hero and Glovo (the Parties) for participating in what it described as a "multi-layered cartel" within the online food delivery sector. The decision brings the end to a settlement procedure formally initiated in July 2024 between the Parties and the EC (Case AT.40795).

No-Hire, Non-Solicitation, No-Poach – A Buyer Cartel?

Between July 2018 and July 2022, Delivery Hero progressively increased its shareholding from 15% to 37.4% in Glovo through multiple financing rounds before ultimately acquiring sole control by increasing its stake to a total of 80.9% of share capital in July 2022. Neither the minority investment nor the ultimate acquisition of sole control of Delivery Hero over Glovo fell under EU merger control law. In the investment transaction documents, namely the Shareholders' Agreements (SHAs), the EC discovered obligations on Delivery Hero towards Glovo (and vice versa) to not hire the other's talent. The SHAs of a total of five financing rounds of 17 July and 31 July 2018, April 2019, December 2019 and March 2021 contained identical wording and pertained, in summary, to management or senior capacity employees, for the case of Glovo's employees as determined by its board, during the period of two years preceding the end of their employment. In the decision, the EC refers to the SHA-clauses as "no-hire" agreements, prohibiting both the active solicitation of each other's employees and the passive hiring of each other's employees even if their applications were unsolicited.

Additionally, in October 2018, following a strong push to expand its workforce, notably through recruiters, Glovo attempted to poach a senior manager from Delivery Hero. This was met by the latter's suggestion of a non-solicitation agreement, later agreed to by Glovo, which banned active recruitment across all employee levels and without temporal or geographic limits. Internal communications found by the EC show that this understanding was swiftly implemented throughout both groups and remained in effect for the entire relevant period. In the decision, the EC refers to these arrangements as a "non-solicitation" agreement, which, unlike a "no hire" agreement, prohibited only the active solicitation of each other's employees. Collectively, "no-hire" and "non-solicitation" agreements are referred as "no-poach" agreements.

In the decision (to no surprise), the EC confirmed its general position outlined in its Competition Policy Brief No. 2 of 2024 on Antitrust in Labour Markets (the Policy Brief) and qualifies both agreements as by-object restrictions to competition. However, the EC's decision adds more detail with regards to non-solicitation agreements and the extent of the required analysis of their economic and legal context. One could argue that an outright prohibition to hire has more serious anti-competitive effects than a prohibition to actively solicit because the former plainly forbids to hire the other undertaking's employees even when the employee actively approaches the competitor on their own or after being solicited by it. However, based on its analysis of the agreement's economic and legal context, the EC holds that the non-solicitation agreement was "bad enough", stressing that active solicitation was seen by Glovo as an important source of talent, a key factor driving expansion in a time where supply of talent was scarce, and that demand for specific expertise was high. Since the EC considered the no-poach agreements as a restriction by object, it was not required to analyse their actual effects on labour markets. In short, the EC considers no-poach agreements as nothing but a buyer cartel, covered by Article 101(1)(c) TFEU.

The EC considered whether the no-hire agreements in the investment SHAs might qualify as permissible ancillary restraints and found that they do not. According to the EC, the non‑controlling character of the investments puts them outside the Ancillary Restraints Notice, and the no‑hire agreements did not satisfy the requirements under the broader ancillary restraints doctrine either, reiterating that only restrictions which are objectively necessary to a non-restrictive main agreement and proportionate to its objectives can escape scrutiny under Article 101(1) TFEU. The no-hire agreements failed this test, as they were (i) unlimited in terms of duration and territory, (ii) de facto reciprocal, and (iii) did not apply equally to all investors, and therefore went beyond what was necessary and proportionate to protect the value of the investors' interests in Glovo. The EC did not consider the ancillary restraints doctrine in relation to the non-solicitation agreement because, as a stand-alone agreement, it lacked any non-restrictive main agreement to which it could have been ancillary to.

Minority shares under scrutiny – can small stakes turn into major risks?

The decision also shows how minority shareholdings may fall under EU antitrust law scrutiny. Minority shareholdings have been on the European antitrust and merger control agenda since over a decade. In some Member States (e.g., Germany), the mere acquisition of shares or voting rights leading to a significant ownership of these rights is subject to national merger control even if no control is acquired. An ongoing debate in both literature and practice theorises whether non-controlling shareholdings should be treated similarly in EU merger control. This case could appease voices for such an inclusion, as the EC seemingly aims to demonstrate that minority shareholdings are already scrutinised when they serve as a facilitator to anticompetitive agreements.

Delivery Hero's minority investment in Glovo came with board representation and access to Glovo's strategic and financial data shared in board meetings. Between September 2018 and July 2022, information was shared extensively with Delivery Hero via direct communication, board documents, and meetings. In addition, Delivery Hero shared information with Glovo so that the Parties could "learn from each other", rendering the exchange two-sided. The exchange concerned highly sensitive information such as the companies' pricing and supply methodologies (e.g., delivery-fee models, dispatch algorithms, and logistics operations), forecasts of demand, sales and profitability, and strategic plans for market entry and expansion. In some instances, the exchange of information also served to coordinate the geographic scope of the Parties' activities. The information received by Delivery Hero's board representatives was routinely shared internally with its own management and followed by internal discussions and analyses. The intensity of the information exchange temporarily decreased from late 2018 to beginning of 2020, following disagreements between the Parties on market allocation, which led to only a fraction of the turnover value being used to establish the basic amount for this period.

The case is the first in which the EC found that a non-controlling minority shareholding contributed to coordination between competitors. Not illegal per se, the minority shareholding raised concerns as it simplified the exchange of sensitive information or the alignment of competitive behaviour. In this case, the board representation enabled Delivery Hero to monitor Glovo's business strategy and influence key decisions with regards to Glovo's geographic marketing activity.  

Sharing the pie and avoiding a food fight – the Parties' market allocation

Finally, the EC found that the companies had agreed from January 2020 not to enter markets where the other was already active and to coordinate future entries into unserved territories. Additionally, the Parties removed the geographical overlaps between them in the EEA, including Delivery Hero selling its operations in Bulgaria, Croatia and Romania. This was again facilitated by the minority shareholding through the ability to veto specific decisions, and by influencing the position of Glovo's other shareholders to convince them to share markets in the EEA.

The allocation of geographic markets rounds off the EC's case against the Parties. Interestingly, the facts around the market allocation are described in no more than a single recital of the decision, while the other two, more "novel" theories of harm in the Parties' "multi-layered" collusion are covered much more broadly. However, the allocation of geographic markets may well have been the Parties main objective and what triggered this case. After all, when the EC first raided the Parties in 2022, the allegations were focused on the allocation of markets, and it seems the case was only later extended to include the other two theories of harm in 2023 (see the EC's Press Release IP/23/5944). Further, the alleged market allocation appears to be closely linked to the EC's concerns around the way Delivery Hero used its position as a minority shareholder and the no-poach agreements. Recall that the Parties exchanged information concerning, among others, their geographic activities and wished to not "kill the[ir] relationship with poaching". Seems like a market allocation theory of harm is "old but gold" also in new industries, such as online food delivery.

The takeaways to deliver

Are there lessons to be learned from Delivery Hero and Glovo for M&A dealmakers, and what are they? Here is some food for thought…

Tailoring no-poach and similar obligations in M&A

• Acquisitions of (joint) control – Ancillary Restraints Notice. If control is acquired, the Ancillary Restraints Notice offers guidance on restrictions to competition for talent fall. Under the Ancillary Restraints Notice, no-poach obligations on sellers are exempted if they are (i) limited to essential employees, (ii) limited in duration (in any case under three years), (iii) limited to territories where sellers have been already active, and (iv) limited to benefit only the buyer and to bind only the sellers. In case of a joint venture, no-poach obligations between the parents and to the benefit of the joint venture are exempted if they are (i) limited to territories where the joint venture is active in, and (ii) limited to personnel that is essential for the joint ventures' performance (e.g., workforce allocated to the joint venture by its parents).

• Genuine main non-restrictive interests. If the investment does not confer (joint) control, which is often the case when only a minority shareholding is acquired, the Ancillary Restraints Notice does not apply. Restrictions to competition for talent may, however, still be permissible if they serve to achieve a genuine, legitimate interest, which is not (!) to restrict competition as such. In simple terms, the parties need to demonstrate that, considering the nature of the agreement and the characteristics of the relevant markets, companies in a similar situation would not have participated in the main transaction without the no-poach obligation.

• Priority to less restrictive alternatives. The parties need to consider whether there are less restrictive alternatives to the envisaged no-poach agreement, if they are equally fit to achieve the parties' legitimate objective. A non-solicitation agreement is less restrictive than a no-hire agreement. If an investor/buyer fears that solicitation of their workforce was imminent, leading to a drain of non-IP protected knowledge, skills, or training made, less restrictive alternatives to competition may include non-disclosure of specific know-how or non-compete obligations in leaver contracts. These must however be equally limited in duration.

• Limits to duration, territory, and substance in M&A related arrangements. Where no-poach agreements appear to be the only commercially viable restriction, they may be permissible under competition law. However, their necessity must be objectively assessed, and to be justifiable, arrangements must be at least (i) limited to essential employees, (ii) limited in duration, (iii) limited to relevant territories, and (iv) limited to benefit only the current employer. No-poach obligations that are (de facto) reciprocal or that do not equally apply to all minority shareholders may be more difficult to justify.

• While negotiations are pending. While the parties negotiate a transaction, a no-poach agreement limited to the parties' key personnel involved in the negotiations and for the time of such negotiations may be justified, if objectively necessary to agree a deal, i.e., if the parties would not be able and willing to discuss the terms of a deal absent the protection of an appropriate tailored no-poach agreement.

• High caution with regards to stand-alone arrangements. If no-poach agreements are not ancillary to another, legitimate agreement (which as such is compliant with EU competition law), but are concluded stand-alone, they will highly likely not withstand scrutiny.
  

Structuring minority shareholdings

The EC highlighted that non-controlling minority shareholdings, which have governance rights attached, are not illegal per se. That also applies to minority shareholdings in direct competitors, although they require closer scrutiny than, e.g., minority stakes in companies which are "only" active in vertically related or neighbouring markets, or markets which are entirely unrelated to the investor's activities. Parties may consider various options to mitigate the risk of running afoul of the antitrust rules:

• Limit strategic influence. Veto or approval rights should be confined to matters essential to protecting the investor's financial interest or the transaction's value. Rights extending to day-to-day or strategic commercial decisions should be avoided or strictly limited to those with a substantial material impact to the interests or business value. If necessary, it may be appropriate for the investor's board representative to refrain from attending board meetings where competitively sensitive issues will be discussed and from voting on such matters. In Naspers/Just Eat Takeaway (Case M.11936), the EC confirmed that minority shareholdings generally raise no concerns where voting rights are not exercised, and the investor is unrepresented in management or supervisory bodies.

• Restrict information flows. Shareholder information and participation rights must be exercised with due regard to competition law. The disclosure of sensitive information to the investor's representatives may have to be subject to prior antitrust review. Investor's representatives' participation rights may have to be limited where a meeting is likely to disclose competitively sensitive information, or the investor's representatives may be required to refrain from attending. Even statutory rights under national law may be limited where competition concerns arise. In any case, once board members had access to sensitive information, they should be prevented from sharing that information within their own organisation. Such "ethical walls" should be formalised, tested regularly, and supported by robust compliance training to prevent unlawful information exchanges or conduct alignment.

In summary, the case delivers not just two new dishes but comes with full sides of compliance lessons for investors. And for the market, a clear takeaway: sharing is not always caring.

Until next time, yours truly.