New York City Council Puts New Limits On Food Delivery Apps

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New York’s Metropolis Council overwhelmingly permitted a collection of payments Thursday aimed toward limiting the scope of third-party supply apps, following issues they’re benefiting from eating places devastated by the COVID-19 pandemic, regardless that additionally they helped them survive.

The council prolonged till February 17, 2022 a cap imposed throughout the pandemic of 15% for deliveries and 5% for different providers, corresponding to advertising and marketing. The cap was set to run out subsequent month. That will have allowed apps to cost fee as excessive as 30-35% mixed, relying on providers.

“Small companies shouldn’t be pressured into accepting these charges with the intention to stay viable and aggressive,” mentioned Queens Council Member Francisco Moya, who sponsored the invoice. “To permit the short-term cap to run out would fully handicap the restoration of so many companies which might be simply beginning to get again on their ft.”

Andrew Rigie, government director of the NYC Hospitality Alliance, praised the council for reining in what he known as “the exploitative enterprise practices of sure, mega dimension third-party supply firms” regardless of “deceptive statements” from the trade.

Supply app firms strongly opposed the extension. GrubHub spokesman Grant Klinzman known as price caps “arbitrary value controls” and predicted they’d “lead to damaging and long-term penalties for locally-owned companies, supply staff, diners, and the native financial system.”

Lots of the apps give eating places a menu of choices at various value factors. DoorDash famous that it affords a primary plan wherein eating places are charged 15% per supply, a price that covers background checks, insurance coverage, and cost to its supply staff.

Third-party supply providers frightened town would enact a everlasting cap like San Francisco did on the charges charged to eating places. Bronx Council Member Mark Gjonaj mentioned a brief extension ought to “face up to any problem” by the apps.

Different Limits Accepted by the Council

One other invoice permitted on Thursday requires the apps to get written approval from a restaurant proprietor earlier than itemizing their enterprise. This invoice additionally bans the supply platforms from requiring eating places to compensate them for damages that happen after meals or drinks depart the restaurant.

The council permitted one other invoice that requires the apps to share buyer knowledge with eating places, after the trade complained its members ought to have the ability to know their prospects. This data features a buyer’s title, cellphone quantity, e-mail handle, supply handle, and the contents of their orders.

The supply firms raised issues about prospects’ privateness rights, and so did teams together with Homosexual Males’s Well being Disaster and the Haitian American Caucus, which mentioned 30% of its members are immigrants and it could not need them put in any compromising conditions.

DoorDash urged that prospects must be required to decide into having their knowledge shared with a restaurant, as a substitute of opting out. A spokeswoman famous the laws doesn’t take impact for a number of months, and mentioned, “we’ll proceed to struggle to guard the privateness of our prospects.”

The laws prohibits eating places from promoting buyer data with out their consent. Regardless of passing simply, the invoice drew sufficient concern that Brooklyn Council Member Carlos Mechaca mentioned he’d work with its sponsor, Keith Powers of Manhattan, so as to add stronger protections so New Yorkers’ knowledge cannot get into the fingers of different entities, like Immigration and Customs Enforcement.

Jonathan Forgash, government director of Queens Collectively Restaurant Affiliation, praised the bundle of laws. “These legal guidelines will assist our eating places achieve management of their buyer knowledge, cut back prices, and achieve enterprise,” he mentioned.

One other invoice extends a pandemic-era restriction by way of February on charging prospects for cellphone calls that don’t lead to an order. The council additionally permitted new laws aimed toward stopping apps from itemizing cellphone numbers that aren’t actually linked to a person restaurant, however seem like and find yourself costing prospects cash once they name.

Town is allowed to superb firms wherever from $500 to $1,000, relying on which legal guidelines they break.

Beth Fertig is a senior reporter masking town’s restoration efforts at WNYC. You’ll be able to observe her on Twitter at @bethfertig.



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