For the better part of two decades, food-delivery apps like Seamless, parent company Grubhub, and others have operated in New York City with relative impunity. But after a string of controversies, including revelations that Grubhub was creating fake websites and phone numbers for restaurants without their owners’ consent and charging restaurants for phone calls that didn’t result in orders, the City Council is mulling a package of bills that would finally regulate these companies.
The most significant bill would limit the fees delivery apps charge restaurants to 10 percent versus the 15 to 30 percent the companies currently charge. Another bill would require Grubhub and others to have a license to operate in New York City, meaning greater oversight from city officials and the ability to revoke and suspend licenses when violations occur.
Councilmember Mark Gjonaj also introduced legislation that would bar food-delivery companies from charging fees for any phone calls that don’t result in orders and require packaging that makes it apparent to customers if a delivery worker has tampered with their food, according to the New York Post.
Grubhub executives say the bills will hurt their bottom lines as well as the bottom lines of the thousands of mom-and-pop restaurants that rely on these apps for business. But as Councilmember Gjonaj points out, these restaurants certainly aren’t thriving under the current system, with Grubhub controlling two-thirds of the New York City market and dictating the terms of its agreements with little or no input from users.
“David and Goliath is what you have here,” Gjonaj told the New York Times. “We just want to give the traditional brick-and-mortar, mom-and-pop restaurants a fighting chance.” Public hearings on the bills are expected to begin in late April.