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Thailand Warns Food Delivery Apps Over Covid-19 Price Gouging

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Food Delivery, Services, Thailand

Thailand’s anti-monopoly watchdog warned food delivery Apps providers on Wednesday they could face fines for charging higher commissions. Above all as online food orders surge amid the COvid-19 coronavirus outbreak.

The announcement comes after malls and restaurants were ordered to close except for take-out orders in late March. Food delivery platforms have seen a spike in orders, with operators like, Grabfood and Foodpanda seeing orders rise.

There have been complaints that food delivery platforms have increased their service fees for restaurants from 20% to rates of up to 40%. The Office of Trade and Competition Commission said, without naming any companies.

Food delivery platforms are also charging restaurants fees for marketing and advertising.

Unfair commercial activity that causes damage to consumers will face a penalty of 10per cent of the year’s revenue, the Office of Trade and Competition Commission (OTCC) secretary-general Somsak Kiatchailak said.

GrabFood said on Wednesday announced it was cutting its maximum food delivery commission from 35% to 30% to reduce the financial burden on restaurants.

“We are taking another step to provide greater support to alleviate the impact of COVID-19 on our community,” Head of Grab Food Thailand, Tarin Thaniyavarn, said in a statement.

Rival food delivery app, LINE MAN, owned by Japanese chat app LINE Corp , has always charged between 20% to 30% for restaurants who opted into the platform’s promotional program. With a discounted delivery fee, its head of business development and marketing, Waranan Chuangcham, told Reuters.

Restaurants can also use LINE MAN without commission where customers pay the regular deliver fee, she said.

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Foodpanda, which has seen order increases of up to 30% each week in Bangkok, said it has kept commission at 30%. Foodpanda Thailand CEO Alexander Felde said it was rolling out a package worth Bt35 million to support riders and restaurants.

The package includes insurance, masks, sanitizer kits for its riders and also free delivery and vouchers for restaurants, Felde said adding that the firm was recruiting 5,000 riders each week to keep up with demand.

GET, the Thai unit of Indonesian ride-hailing startup, Go-Jek, also did not respond a Reuters request for comment.