Recent overseas media reports reveal that DiDi Global Inc.'s Brazilian food delivery subsidiary 99Food has been signing exclusive "choose-one-or-the-other" agreements with merchants through substantial upfront cash incentives, explicitly prohibiting these merchants from engaging in any form of cooperation with MEITUAN-W's Keeta brand. In response, MEITUAN-W's international food delivery brand Keeta has filed a lawsuit with local courts, claiming these terms are specifically designed to prevent Keeta from entering the Brazilian market, thereby restricting competition and reducing innovation.

**DiDi's Food Delivery Platform Offers Exclusive Contracts Demanding Merchant Exclusivity**

According to Brazilian media reports, the "platform war" in Brazil's food delivery market has escalated once again. 99Food, controlled by DiDi Global Inc., re-entered the Brazilian food delivery market last month with an investment of 1 billion reais. To rapidly capture market share, the company has offered millions of reais in "upfront incentives" to select "strategic" restaurants, with the condition that these establishments cannot establish any business or contractual relationships with Keeta (MEITUAN-W's brand in Brazil) during the contract period. However, these restrictions do not limit merchants' cooperation with Brazil's local food delivery giant iFood.

In exchange, 99Food pays a one-time "investment" fee, though specific amounts and merchant lists have not been disclosed publicly. According to informed sources, while small merchants receive millions of reais, larger establishments have received incentive payments of 130 million reais.

Reports indicate that 99Food responded by stating these practices are "legal and common" in Brazil's food delivery industry, describing its "tiered business strategy" as necessary to protect market share in a highly concentrated and competitive market.

In essence, 99Food is using substantial cash payments to secure exclusive restaurant partnerships, attempting to block Keeta's market entry, marking the official start of a "cash-burning" and "exclusivity" war in Brazil's food delivery market. Previously, 99Food announced a 1 billion reais investment in Brazil, with 900 million reais already spent specifically on blocking Keeta.

**Brazil's Food Delivery War: DiDi's 99Food Previously Fined**

This marks the second time DiDi's 99Food has been sued for unfair competition practices, following a previous case where São Paulo courts issued an injunction against the company's malicious purchase of "Keeta" advertising keywords. On August 11th local time, the court ordered 99Food to cease confusing "Keeta" keyword search results on Google and similar platforms within three days, with penalties of 20,000 reais per day for non-compliance.

According to reports, DiDi's 99Food has currently approached over 100 restaurant chains locally, offering at least 900 million reais (over 1 billion yuan) in upfront payments in exchange for "choose-one-or-the-other" exclusive agreements. However, these exclusivity clauses primarily target MEITUAN-W's Keeta, while not restricting merchants' cooperation with local food delivery giant iFood.

Previously, DiDi's 99Food responded to Brazilian business media, acknowledging the "choose-one-or-the-other" practice and describing it as a strategy targeting core merchants.

**DiDi Invests Another $1 Billion as Food Delivery War Continues**

According to a survey conducted jointly by the Brazilian Association of Bars and Restaurants (Abrasel) and the Brazilian Micro and Small Business Support Service (Sebrae), iFood currently holds 80% market share in the local food delivery sector, followed by Rappi with 9%. Other participants hold less than 3% market share each.

Overseas media reports indicate that from late April to early May, multiple food delivery apps announced billion-dollar investments in Brazil to compete for this market. Among them, 99Food invested 1 billion reais, while Rappi announced plans to invest 1.4 billion reais over the next three years.

Brazil's leading food industry player iFood was prohibited from signing exclusive contracts with restaurant chains owning more than 30 establishments at the end of 2023, intensifying competition in the sector. This regulation was established by the Administrative Council for Economic Defense (Cade), along with a series of rules aimed at curbing anti-competitive behavior in the industry.

Both MEITUAN-W and DiDi Global Inc. are new market entrants, with DiDi restarting its Brazilian food delivery business 99Food in June this year, while MEITUAN-W's Keeta announced in May that it would enter Brazil within months and is currently in the business preparation phase.