(Yicai Global) May 14 -- China's three biggest meal delivery platforms have banned more than 19,000 illegal restaurants in Beijing as they look to clamp down on unlawful eateries under orders from the food safety regulator.
Ele.me, run by Shanghai Lazhasi Information Technology Co. under Alibaba Group Holding Ltd., has sent more than 7,900 unlicensed restaurants offline, the Beijing Food and Drug Administration reported, citing the company's website. The firm's subsidiary and competitor Baidu Waimai gave 4,400 caterers the boot and Meituan Waimai, run by Beijing Sankuai Technology Co., banned 7,200.
The platforms were failing to conduct legal checks and allowed restaurants to distribute food unlawfully online, creating a host of food safety issues, the regulator said. All three had been looking to capitalize on the rapidly growing meal delivery sector and command a combined 90-percent share of the market, which now supplies 1.8 million meals per day via CNY100 million (USD16 million) worth of sales in Beijing alone.
Alibaba, China's biggest e-commerce firm and pioneer of the New Retail model, which fuses digital and offline operations, bought full control of Ele.me's operator for USD9.5 billion in April. Lazhasi had bought out rival Baidu Waimai in August but allowed the unit to maintain its brand.
Editors: Emmi Laine, James Boynton