Minority Stakes, Major Consequences: Lessons From the Delivery Hero/Glovo Case

In recent years, competition authorities worldwide have shown increasing interest in potential competition issues in labor markets. More particularly, no-poach and wage-fixing agreements have become a priority for competition enforcement agencies in the European Union, the United Kingdom, the United States, and, more recently, Brazil. Regulators have issued numerous guidance documents and recommendations for employers on how to comply with competition law and have initiated antitrust investigations in this field. As new EU Competition Commissioner Teresa Ribera has highlighted, this reinforcement of antitrust rules is part of ensuring “a fair labor market”, “where employers compete for talent and do not collude to limit the number and quality of opportunities for workers”, thus prohibiting agreements that “prevent workers from moving where they can contribute more effectively to the economy”.

The US agencies were among the first to address competition issues in labor markets, with the issuance of a joint Department of Justice (DOJ) and Federal Trade Commission (FTC) Antitrust Guidance for Human Resource Professionals in October 2016. Former EU Competition Commissioner Vestager had indicated back in 2021 that the Commission was paying great attention to this new form of purchasing cartels as an area of enforcement activity under Article 101(1)(c) of the Treaty on the Functioning of the European Union (TFEU). On 21 June 2022, Olivier Guersent, Director-General of the Directorate General for Competition, suggested that labor markets would in future be subject to increasing scrutiny by supranational enforcers. Therefore, despite the novelty of this restrictive practice under Article 101 of the TFEU, the Delivery Hero/Glovo decision was expected or at least foreseeable, considering that labor-related agreements had been on the Commission’s radar for some time. This was particularly the case after the release of the Commission’s policy brief in May 2024 setting out its view that wage-fixing and no-poach agreements had the potential to restrict competition by their very nature, i.e., they were “by object” or per se restrictions.

In the meantime, national competition authorities (NCAs) in Europe have played a crucial role in addressing the growing concerns with restraints in markets for talent. For instance, the Portuguese Authority condemned two distinct infringements: (i) in December 2022, it issued a statement of objections against a cartel between laboratories providing clinical analyses and COVID-19 tests, which included an agreement not to hire workers; and (ii) in April 2022, it ruled that several Portuguese football clubs had entered into a no-poach agreement by not hiring players who had unilaterally terminated their contracts due to pandemic-related issues. The Lithuanian and Polish authorities took similar enforcement actions in the sports sector in 2022 against horizontal no-poach agreements entered into by football and basketball leagues (in which they promised not to hire or pay players who had terminated their contracts due to COVID-19), and considered such agreements as “by object” restrictions of competition.

In July 2024, the Belgian Competition Authority (BCA) fined security companies for participating in a cartel that included no-poach agreements. These companies agreed not to hire each other’s employees. The BCA ruled that no-hire clauses between competitors were by object restrictions and emphasised that such agreements harmed workers by limiting job mobility and suppressing wage growth and thus distorted the labor market. While labor-related restrictions have typically been part of broader cartel cases, the UK Competition and Markets Authority (CMA) recently imposed a relatively modest fine of £4 million on sports broadcasters for exchanging sensitive information about wages paid to freelancers (23 May 2025).

In France, the French Competition Authority (FCA) sanctioned companies active in the linoleum flooring (2017) and precast concrete products (2024) sectors, including for specific no-poach clauses aiming at banning each competitor from soliciting and hiring their respective staff. Finally, less than 10 days after the announcement of the Commission decision in Delivery Hero/Glovo, the FCA seems to be following in the Commission’s footsteps by sanctioning, on a standalone basis, two “non-poaching” agreements and imposing a total fine of €29,500,000 on three companies active in the engineering, technology consulting, and IT services sectors (the fourth company received full immunity from fines due to its status as a leniency applicant).

The active role of NCAs in labor market cases stems from the local or national nature of these markets, which are better addressed at the national level, while the Commission focuses on cross-border cases. However, NCAs can and frequently do pass on their concerns about particular cross-border markets to the Commission. Indeed, it was after just such a tip off from an NCA and the EU’s whistleblower tool that the Commission conducted inspections on the premises of companies on 6 July 2022, targeting alleged market-sharing practices in the online food-delivery sector. On 21 November 2023, the scope of the investigation was broadened to include alleged no-poach agreements and sensitive information exchanges. This led to the formal opening of an antitrust investigation on 23 July 2024 to assess potential violations of EU competition rules.

As regards the EU courts, they have so far broadly supported NCAs’ approach to these cases; for example, following a preliminary ruling request by the Regulation and Supervision Court in Portugal to the Court of Justice of the European Union, Advocate General Emiliou issued an opinion in May 2025 stating that no-poach agreements are generally considered restrictive by object, but the opinion also supports greater flexibility and a context-driven approach when evaluating the compatibility of no-poach agreements within EU competition law, because finding a restriction “is by no means the end of the analysis” and “context always matters”.

The Decision

The present decision is of particular interest for two main reasons. First, it highlights the risks of acquiring a minority stake in a competitor, as it may result in hefty fines being imposed where it is used to facilitate cartel conduct. Second, the Commission imposed a fine for the first time for a standalone infringement in the existence of a no-poach agreement.

The Commission’s Analysis of Delivery Hero’s Minority Shareholding in Glovo

According to the Commission, the illegal cartel began in July 2018, when Delivery Hero acquired a minority shareholding (reported to be 15%) in Glovo, which facilitated the alignment of the two companies’ respective strategies until July 2022, when Delivery Hero obtained sole control of Glovo.

While the press release recalls that “owning a stake in a competitor is not in itself illegal”, this does not protect a non-controlling investor from enforcement under Article 101 of the TFEU (unlike companies that are under common control, as intra-group information exchanges are not subject to Article 101), especially when the investment facilitates anticompetitive contacts between competitors. This is exactly what the Commission fined Delivery Hero for doing in this case. By giving Delivery Hero access to Glovo board meeting documents and voting rights in the general assembly and board of directors, its minority stake enabled it “to obtain access to commercially sensitive information and to influence decision-making processes in Glovo, and ultimately to align the two companies’ respective business strategies.”

Consequently, this case stands as a stark reminder for undertakings with a non-controlling shareholding in a competing company that “horizontal cross-ownership between competitors may raise antitrust risks and should be handled carefully” – otherwise, any information exchanges resulting from the minority shareholding may be deemed unlawful and result in fines (and, potentially, claims for damages).

The key conclusion from this aspect of the decision is that as long as a company has not acquired sole control of a competing firm (which was the case until 2022 in Delivery Hero/Glovo), neither company can benefit from intra-group immunity in the intervening period and must be particularly cautious in their information flows so as not to engage in illegal conduct that can result in significant fines being imposed.

The Commission Identifies Its First Standalone “No-Poach” Cartel

As mentioned previously, this decision marks the first instance in which the Commission has sanctioned a standalone no-poach agreement. Specifically, the Commission determined that the shareholders’ agreement, signed when Delivery Hero acquired a non-controlling minority interest in Glovo, included reciprocal no-poaching clauses. Initially, these clauses were limited to certain employees but were subsequently expanded to encompass a general agreement not to actively approach each other’s employees.

Although the Commission did not elaborate on its reasoning in the press release, it concluded that such practices constitute a restriction “by object”. This classification was expected, as the Commission had already indicated in its policy brief that such practices cause economic harm and are detrimental to employees. This reasoning aligns with US antitrust practices, where no-poaching agreements are deemed presumptively or “per se” unlawful under the Sherman Act because they restrict a market input (labor) without a corresponding increase in output (productivity or mobility).

This decision confirms the Commission’s intention to analyze horizontal arrangements related to talent acquisition, such as recruitment or remuneration, within the context of the relevant labor market, irrespective of how companies are positioned in the downstream market. Such agreements are likely to reduce labor mobility, create inefficiencies downstream by distorting the allocation of labor, or to foster collusive conditions more generally. In essence, this decision underscores the necessity for companies to consider carefully their employment practices in the context of competition in labor markets, recognizing that competition extends beyond products or services to include talent acquisition and retention.

The high antitrust risk associated with these arrangements, as outlined in the decision, also explains why the Commission intends to assess the potential adverse effects of mergers on employment and labor markets as part of its review of its substantive merger guidelines. This approach is similar to the new merger guidelines (December 2023) in the United States, which articulate a strong intention to evaluate the competitive effects of mergers, particularly when there is a risk that the merger may lessen competition for labor.

Finally, the sanctions imposed on Delivery Hero and Glovo, amounting to €223,285,000 and €105,732,000, respectively, are notably severe and reflect the Commission’s stringent stance on such practices. Delivery Hero noted that the fine was less than its initial provision of €400 million, as the Commission indicated a “lower intensity of the issues investigated for some periods”. Upon publication of the Commission’s decision, the factors considered in determining the fines will be disclosed.