NY State Senate Bill 2021-S1547

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to consumer protection
Jan 13, 2021	referred to consumer protection

co-Sponsors

2021-S1547 (ACTIVE) - Details

Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Add §396-rrr, Gen Bus L
Versions Introduced in 2019-2020 Legislative Session:: S8290

2021-S1547 (ACTIVE) - Summary

Relates to capping third-party food delivery service fees so that such fees cannot exceed ten percent of the purchase price of an online order.

2021-S1547 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S1547

SPONSOR: KAVANAGH
 
TITLE OF BILL:

An act to amend the general business law, in relation to third-party
food delivery service fees

 
PURPOSE OF BILL:

To prohibit a third-party food delivery service from imposing on a food
service establishment a per-order fee of more than 10% of the purchase
price.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 of the bill adds a new section 396-rrr to Article 26 of the
general business law. Subsection 1 defines terms.

Subsection 2 law prohibits a third-party food delivery service from
imposing on a food service establishment a per-order fee of more than

10% of the purchase price.

Subsection 3 subjects a third-party food delivery service in violation
of this section or applicable results to a civil penalty of at least
$1,000.

Subsection 4 authorizes the Secretary of State to seek administrative
remedies under article 63 of the CPLR, and authorizes the Attorney
General to seek injunctive relief and monetary relief against those in
violation of this section.

Subsection 5 authorizes the Division of Consumer Protection, in conjunc-
tion with the Secretary of State, to promulgate regulations necessary to
implement this act.

Section 2 of the bill sets forth the effective date.

 
JUSTIFICATION:

Through their outsized commission fees, third-party food delivery
services have negatively affected the viability of restaurants in New
York State. Even though, according to one source, the average restau-
rant's profits range from only 3% to 9%, some third-party food delivery
services charge up to 40% in fees per order for orders placed through
the platform. Some third-party food delivery services also may require
restaurants to charge the same price for items sold through that deliv-
ery service and those sold to dine-in customers or take out customers
who do not that delivery service, despite differing costs to the restau-
rant for these sales. Limiting the fees charged by third-party food
delivery services ensures fairer and more transparent practices for New
York restaurants and consumers.

 
LEGISLATIVE HISTORY:

2020: S8290 (Kavanagh) - INTERNET AND TECHNOLOGY

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately.

2021-S1547 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1547
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             January 13, 2021
                                ___________
 
 Introduced  by Sens. KAVANAGH, KAMINSKY -- read twice and ordered print-
   ed, and when printed to be committed  to  the  Committee  on  Consumer
   Protection
 
 AN  ACT  to  amend  the general business law, in relation to third-party
   food delivery service fees
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The general business law is amended by adding a new section
 396-rrr to read as follows:
   §  396-RRR.  THIRD-PARTY  FOOD DELIVERY SERVICE FEES. 1.  DEFINITIONS.
 FOR THE PURPOSES OF THIS SECTION, THE FOLLOWING  TERMS  SHALL  HAVE  THE
 FOLLOWING MEANINGS:
   (A)  "COVERED ESTABLISHMENT" SHALL MEAN ANY FOOD SERVICE ESTABLISHMENT
 THAT OFFERS, EITHER DIRECTLY OR  THROUGH  A  THIRD-PARTY  FOOD  DELIVERY
 SERVICE,  IN A SINGLE COMMERCIAL TRANSACTION OVER THE PHONE OR INTERNET,
 THE SALE AND SAME-DAY DELIVERY OF FOOD AND BEVERAGES TO  CUSTOMERS  FROM
 ONE OR MORE RETAIL LOCATIONS WITHIN THE STATE.
   (B)  "FOOD SERVICE ESTABLISHMENT" SHALL MEAN ANY BUILDING, VEHICLE, OR
 STRUCTURE, OR ANY ROOM OR DIVISION IN A BUILDING, VEHICLE, OR  STRUCTURE
 WHERE  FOOD  IS PREPARED, SERVED OR SOLD FOR IMMEDIATE CONSUMPTION ON OR
 IN THE VICINITY OF THE PREMISES, CALLED FOR OR TAKEN OUT  BY  CUSTOMERS,
 OR  PREPARED  PRIOR  TO BEING DELIVERED TO ANOTHER LOCATION FOR CONSUMP-
 TION.
   (C) "ONLINE ORDER" MEANS AN ORDER PLACED BY A CUSTOMER THROUGH A PLAT-
 FORM PROVIDED BY A THIRD-PARTY FOOD DELIVERY SERVICE.
   (D) "PURCHASE PRICE" MEANS THE MENU PRICE OF AN ONLINE  ORDER,  EXCLU-
 SIVE OF TAXES, GRATUITIES, AND ANY OTHER FEES THAT MAY MAKE UP THE TOTAL
 COST TO THE CUSTOMER OF AN ONLINE ORDER.
   (E)  "THIRD-PARTY  FOOD  DELIVERY  SERVICE"  MEANS ANY WEBSITE, MOBILE
 APPLICATION, OR OTHER INTERNET SERVICE THAT OFFERS OR ARRANGES  FOR  THE
 SALE  AND  SAME-DAY  DELIVERY  OR  SAME-DAY PICKUP OF FOOD AND BEVERAGES
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD06459-01-1

 S. 1547                             2
 
 PREPARED BY NO FEWER THAN TWENTY  SEPARATELY  OWNED  AND  OPERATED  FOOD
 SERVICE ESTABLISHMENTS.
   2.  PER-ORDER FEES. IT SHALL BE UNLAWFUL FOR THIRD-PARTY FOOD DELIVERY
 SERVICES TO IMPOSE ON A COVERED ESTABLISHMENT A FEE PER ONLINE ORDER FOR
 THE USE OF THEIR SERVICES THAT TOTALS  MORE  THAN  TEN  PERCENT  OF  THE
 PURCHASE PRICE OF SUCH ONLINE ORDER.
   3. PENALTIES. ANY PERSON THAT VIOLATES SUBDIVISION TWO OF THIS SECTION
 OR  ANY  RULES OR REGULATIONS PROMULGATED PURSUANT TO THIS SECTION SHALL
 BE SUBJECT TO A CIVIL PENALTY OF NOT LESS THAN ONE THOUSAND DOLLARS  PER
 VIOLATION. VIOLATIONS SHALL ACCRUE ON A DAILY BASIS FOR EACH DAY AND FOR
 EACH COVERED ESTABLISHMENT CHARGED A FEE IN VIOLATION OF THIS SECTION OR
 ANY RULE PROMULGATED PURSUANT TO THIS SECTION.
   4.  ENFORCEMENT.  THE SECRETARY OF STATE MAY SEEK ANY RELIEF AVAILABLE
 UNDER ARTICLE SIXTY-THREE OF THE CIVIL  PRACTICE  LAW  AND  RULES  IN  A
 PROCEEDING  AGAINST  ANY  PERSON  ALLEGED  TO  BE  IN  VIOLATION OF THIS
 SECTION. IN ADDITION, THE ATTORNEY GENERAL MAY BRING AN ACTION ON BEHALF
 OF THE PEOPLE OF THE STATE OF NEW YORK TO ENJOIN ACTS  IN  VIOLATION  OF
 THIS  SECTION  AND TO RECOVER ANY CIVIL PENALTIES UNLESS CIVIL PENALTIES
 HAVE BEEN PREVIOUSLY RECOVERED IN SUCH ADMINISTRATIVE PROCEEDINGS.
   5. RULES AND REGULATIONS. THE  DIVISION  OF  CONSUMER  PROTECTION,  IN
 CONJUNCTION  WITH THE SECRETARY OF STATE, SHALL PROMULGATE ANY RULES AND
 REGULATIONS NECESSARY TO IMPLEMENT THIS SECTION.
   § 2. This act shall take effect immediately.

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Senate Bill S1547

Sponsored By

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

co-Sponsors

2021-S1547 (ACTIVE) - Details

2021-S1547 (ACTIVE) - Summary

2021-S1547 (ACTIVE) - Sponsor Memo

2021-S1547 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S1547

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Sponsored By

Brian Kavanagh

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

co-Sponsors

Jeremy A. Cooney

Todd Kaminsky

2021-S1547 (ACTIVE) - Details

2021-S1547 (ACTIVE) - Summary

2021-S1547 (ACTIVE) - Sponsor Memo

2021-S1547 (ACTIVE) - Bill Text download pdf

Comments