Bill would cap 3rd-party delivery fees
BY ROBBIE SEQUEIRA
A package of bills that
would place permanent reforms
on third-party food delivery
services in New York
City — including a 20% cap on
service fees — will level a “David
vs. Goliath” playing fi eld
between small restaurants
and platforms such as Door-
Dash, Uber Eats and Grub-
Hub, according to one city
councilman.
During the pandemic, the
New York City Council placed
a temporary 20% cap on delivery
and non-delivery fees
as well as the commissions
that can be charged by thirdparty
platforms from phone
order fees for calls that did not
result in a completed order.
However, those temporary
measures are set to expire on
Aug. 17, which covers the fi rst
three months of Democratic
Gov. Andrew Cuomo’s statewide
mandate that lifted all
COVID-related restrictions to
allow for full capacity indoor
restaurant dining on May 19.
The bill is a part of a series
of legislative items co-sponsored
by Mark Gjonaj, Democrat
councilman representing
the Bronx’s 13th District and
Democrat Francisco Moya,
who represents Queens’ 21st
District.
“New York City’s restaurant
sector is an indispensable
part of our local economy,”
Gjonaj said in a statement sent
to the Bronx Times.”As Chair
of the city Small Business
Committee, my mandate is to
ensure a fair and level playing
fi eld in the David versus Goliath
relationship that many
mom-and-pop eateries have
with venture capital backed
food delivery platforms.”
An additional measure in
the four-bill package currently
in committee would also prohibit
third-party platforms
from posting restaurant listings
of NYC restaurants and
establishments without their
authorization.
If approved by council,
Mayor Bill DeBlasio, a Democrat,
has 30 days to sign it into
law.
During the pandemic, more
than 1,000 NYC food establishments
shut their doors. Gjonaj
said during Thursday’s city
Small Business Committee
hearing that while New York’s
restaurant industry was gutted
BRONX TIMES R 14 EPORTER, JULY 9-15, 2021 BTR
by the pandemic, thirdparty
platforms saw a boost in
business.
“The third-party platforms
were experiencing a
dramatic increase on business
while the restaurants were
seeing a depletion of their
business,” Gjonaj said.
MarketWatch tracked revenues
of the top four U.S. thirdparty
delivery apps — Door-
Dash, UberEats, GrubHub and
Postmates — and reported
that the four companies generated
roughly $5.5 billion in
combined revenue from April
2020 through September 2020,
more than twice as much as
their combined $2.5 billion in
revenue during the same period
in 2019.
Conversely, NYC’s restaurants
lost a reported $10.3 billion
from March to November
2020.
At Thursday’s fi ve-hour
hearing, roughly 20 restaurant
owners and hospitality industry
advocates spoke in favor of
the permanent cap and cited
“exploitative practices” by
third-party platforms — such
as unauthorized listings that
rely on outdated menus and
bypasses restaurants as the
fi rst contact for orders — that
have undercut restaurant revenue
and customer base.
“Today, the City Council is
taking the bold opportunity to
consider making the fee caps
permanent and we are fully
supportive of this move,” said
Kathleen Reilly, government
affairs coordinator for the
New York City Restaurant Association.
“The lived experience
of restaurant operators
and their important testimonies
at this hearing … make
it clear that third-party delivery
platforms have been fi nding
ways to take advantage of
their role in the restaurant
eco-system.”
Democratic Councilman Mark Gjonaj believes a permanent fee cap on
third-party delivery services could help level the playing fi eld for NYC
small eateries and big platforms. Photo Reuters
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