After FSSAI clampdown, Zomato begins delisting non-licensed restaurants partners

Following the diktat from The Food Safety and Standards Authority of India (FSSAI), Zomato has started delisting non-compliant restaurant from its platform. FSSAI had instructed all major foodtech players to delist non-compliant restaurant partners to ensure food hygiene and safety in July this year.

Zomato Co-founder and CEO, Deepinder Goyal had announced the development on the company’s blog.

“Some restaurants who were not able to furnish their FSSAI licenses have high Zomato ratings and/or high repeat order volumes on Zomato – we have given them until the end of this month to furnish their licenses to us”, outlines Goyal on the blog.

He also urged customers to check the restaurant rating before placing any order.

Earlier, the government’s nodal agency had given a deadline of July 31st to comply with the diktat, however, foodtech players including Swiggy, Zomato, UberEats, Box8, Fasoos, FoodCloud, Foodmongo, Foodpanda, JusFood, and LimeTray have failed to meet the regulator’s deadline for obtaining licence.

This will be major crackdown for these players as well as their restaurant partners. For example, Zomato has over 50,000 restaurant partners. The company claims to do about 13 million orders every month.

The decision of FSSAI comes after several complaints of substandard food being delivered through these aggregators. And it will bring in all food businesses under the FSSAI licensing regime and ensure compliance of the food safety laws.

Besides, the regulator is also thinking over conducting an audit of IT unit of these foodtech players under the Food Safety and Standards Act, 2006.

As the deadline has already over, it will be interesting to see how other foodtech platforms such as Swiggy, foodpanda, and UberEats react to the regulations.

This not the first case of delisting sellers came to light. Apart from foodtech, e-commerce firms such as Flipkart and Paytm had taken stringent action against sellers and logistics partners.

While SotfBank-backed Paytm Mall had delisted 85,000 sellers and 6 logistics partners to improve customer experience, Flipkart had also threatened to delist sellers or snatch the ‘Flipkart assured’ badge (Fassured) in case their products fail to pass the audit.