The Competition and Consumer Commission of Singapore (CCCS) has issued a warning to Delivery Hero (Singapore) Pte. Ltd., operating as Foodpanda, over misleading advertisements for its Pandapro subscription service.
The advertisements, run during the period of 1 July to 30 September 2024, falsely promoted “unlimited free delivery on all restaurants,” leading to public complaints and a subsequent investigation by the CCCS.
The advertisement appeared on multiple platforms, including Instagram, in-app promotions, and public billboards.
CCCS found that the phrase “unlimited free delivery” could mislead consumers into believing that no delivery charges applied to any restaurant when subscribing to Pandapro.
In reality, subscribers received only a $3 discount on all restaurants or up to $6 on selected restaurants. Over 40% of delivery transactions during the advertising period required customers to pay a residual delivery fee after discounts were applied.
CCCS investigation and outcomes
Following a complaint in August 2024, CCCS launched an investigation into the advertising claims.
The investigation revealed that the advertisements failed to clarify that additional charges might apply. Foodpanda acknowledged the issues raised and agreed to take corrective actions, including:
- Issuing full refunds of subscription fees to customers who subscribed during the advertising period.
- Clarifying the terms of the Pandapro subscription to both subscribers and the public.
- Reviewing existing and future marketing materials to ensure compliance with Singapore’s fair trading laws.
Although CCCS concluded the case with a warning, it cautioned Foodpanda that stronger enforcement actions could follow if similar issues arise in future advertisements.
Guidance for businesses on advertising terms
CCCS emphasised the importance of transparency when using terms like “free” in advertising. Representations of $0 or “free” must be accurate, with any qualifiers or additional costs stated prominently. A vague disclaimer, such as “terms and conditions apply,” is generally insufficient.
“When a business offers ‘free’ services to entice the consumer, it is not unreasonable for consumers to understand this as meaning no charges will apply,” said CCCS Chief Executive Alvin Koh.
He added that clear and accurate claims are critical to enabling informed consumer decisions and fair competition among businesses.
CCCS encouraged members of the public to report misleading advertisements or unfair trade practices to the Advertising Standards Authority of Singapore (ASAS). Complaints can be lodged online at https://asas.org.sg/feedback/online-complaint or via phone at 6461 1888.
