Regulation

Colombia Watchdog Investigates Rappi Delivery App For Noncompliance

On-demand delivery app Rappi is under investigation again in Colombia, accused of failing to comply with regulatory orders to improve its customer service response, according to Reuters.

Founded in 2015, the Colombian startup uses bike-riding couriers for delivery of everything from grocery orders to diapers all around the country, as well as Brazil, Mexico, Argentina, Chile, Peru, Uruguay and Costa Rica. In August, it partnered with French pharmaceutical company Sanofi to offer healthcare services in Latin America.

One month later, Colombian regulators ordered the company to comply with eCommerce laws, while also starting an investigation into the app after receiving hundreds of customer complaints on such issues as fulfilling special offers, charges for canceled orders and more.

Now, the country’s Superintendency of Industry and Commerce has started another investigation against Rappi, this time “for an alleged unfulfillment” of five of the requirements that the regulator previously set, including not changing its terms and conditions, issues surrounding price changes and failure to establish a proper complaint system. If the company is found guilty, it could face “successive fines” of up to 1,000 minimum monthly salaries, or about $244,700 each.

“Not having a complaints channel for their customers, the fact that there is still confusion in the terms and conditions, … the final price for the consumer still being unknown and variable, the fact they are still not giving full attention to the complaints … calls our attention,” said Andrés Barreto, head of the Superintendency of Industry and Commerce.

While Rappi said it hasn’t been informed of the new investigation, it is willing to speak with regulators.

“I would love to meet with them and talk over things. We are trying to build a great company that will benefit the country,” said Co-founder Simon Borrero, according to Reuters. “The claims are about things that are not the reality of our business.”

Earlier this year, SoftBank made a $1 billion investment in the app, making it the majority owner in the startup.

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