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NYC to cap Uber Eats, DoorDash and Grubhub restaurant fees

Food supply apps will face a everlasting cap on the commissions they’ll cost eating places underneath a invoice handed by the New York City Council late Thursday, sending the shares of Grubhub and DoorDash plummeting. 

The invoice would restrict the quantity that apps can cost eating places to 15 p.c of meals orders for supply providers, 5 p.c for promoting and different miscellaneous providers and 3 p.c for bank card processing fees. 

If signed into regulation, the New York City council invoice would additionally require meals supply apps to apply for working licenses, which might be reviewed each two years. 

Shares of Grubhub’s dad or mum company Just Eat Takeaway have been down about 5.6 p.c on the information mid-morning Friday, whereas DoorDash shares had fallen 2.4 p.c, in accordance to MarketWatch knowledge. 

Shares of Uber, which has a extra diversified business and could due to this fact be much less uncovered to the invoice, have been up about 1 p.c.

Mayor Bill de Blasio has 30 days to signal the laws, which might take impact 120 days after changing into regulation. His office didn’t instantly reply to a request for remark. 

The New York City council invoice would additionally require meals supply apps to apply for working licenses, which might be reviewed each two years. 
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The invoice would make everlasting a brief cap that was first applied in June 2020 so as to assist eating places climate the pandemic after many eating places complained apps have been charging fees as excessive as 30 p.c. 

In statements to Reuters, Grubhub slammed the invoice as “flagrantly unconstitutional,” whereas DoorDash known as it “unnecessary and unconstitutional.” 

Uber spokesperson Harry Hartfield declined to remark. 

The New York laws follows an identical everlasting cap on supply fees passed by San Francisco earlier this summer. 

Mayor Bill de Blasio has 30 days to signal the laws, which might take impact 120 days after changing into regulation.
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Grubhub has additionally taken flak from politicians and restaurant homeowners over a controversial cellphone supply system that unfairly charged restaurant homeowners for orders that by no means befell. 

The company lastly ditched the controversial observe this Monday, greater than two years after The Post first reported on the problem in 2019. New York City Council members had been demanding that Grubhub refund all “erroneous phone order charges” to eating places and threatened to “explore legislative solutions if the company fails to act.”