Regulators have put Amazon’s investment in Deliveroo on hold.
The Competition and Markets Authority served an initial enforcement order on the companies following the announcement in May that the eCommerce giant had led a $575 million funding round into Deliveroo.
It effectively pauses the deal while the CMA decides if it needs to launch an investigation into whether the two enterprises will “cease to be distinct”.
Deliveroo’s ‘gig-economy’ app allows restaurants to offer home delivery via a network of drivers and cyclists.
Founded in 2012, the funding round took the total raised by the tech company to $1.53 billion.
“There are a number of major companies within the restaurant food delivery sector and this investment will enable Deliveroo to expand, innovate and, we believe, will enhance competition,” a Deliveroo spokesman told Reuters.
“This investment will help create jobs, help restaurants to grow their businesses and will improve choice for consumers.”
The spokesman added that the two companies had been working closely with regulators to obtain their approval. Amazon declined to comment.
At the time of the investment announcement Will Shu, founder and CEO of Deliveroo, said Amazon and been a personal inspiration to him and the company, and that he was ready to work with a “customer-obsessed organisation”.
“This is great news for the tech and restaurant sectors, and it will help to create jobs in all of the countries in which we operate,” he said at the time.
Doug Gurr, Amazon UK country manager added: “We’re impressed with Deliveroo’s approach, and their dedication to providing customers with an ever increasing selection of great restaurants along with convenient delivery options.
“Will and his team have built an innovative technology and service, and we’re excited to see what they do next.”
Deliveroo currently operates in 14 countries and works with over 80,000 restaurants.