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Monthly Roundup: February 2020

Lawmakers try to level the playing field between restaurants and tech giants

If a new law is a tool for solving a problem, then there is a growing number of proposals that aim to make good on that idea.

In New York City, California, and Rhode Island, elected officials are trying to crack down on the controversial practices of third-party delivery services. And, in San Francisco, city officials have held the first of what’s expected to be a series of hearings meant to come up with solutions. 


Let’s start with New York City. A package of bills proposed in the Big Apple would make many needed changes, including limiting the commissions that restaurants must pay to food delivery apps to no more than 10%. It would also require third-party delivery apps to be licensed by the city, which would give the city the power to discipline companies who violate rules around false advertising. 

The apps would also have to disclose to customers the fees and commissions they charge restaurants.

“So many of these orders are not profitable,” Robert Guarino of 5 Napkin Burger told The New York Times last month in New York City May Crack Down on Grubhub and Other Food Delivery Apps. “Are these platforms providing a new customer, or taking the business of existing customers and charging us a fee?”

In Rhode Island, state lawmakers are considering a proposal that would prohibit apps from posting a restaurant’s brand or menu without their written consent. That development was reported by Eater San Francisco in New Laws Would Ban Delivery Apps From Adding Restaurants Without Their Permission.

And, in California, newly-written Assembly Bill 2149, the Fair Food Delivery Act, will prohibit delivery apps from listing restaurants on their platforms without a prior agreement in place. It will also require apps to loop restaurants into important information about the customer.

All too often, a customer receives a meal that was tampered with during delivery, or winds up ordering a meal from a restaurant not aware it was listed on an app and not prepared to fulfill the order. AB 2149 could help consumers avoid that confusion – and could help restaurants and apps work together to resolve a problem with an order.

We’ve written before about the many problems that have stemmed from aggressive moves by tech giants into foodservice. We’re glad now to be telling you about possible fixes.

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The Daily Prep Team

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