Technology

Philadelphia caps delivery fees at 15%

It is the latest city to limit the commissions charged to restaurants by third-party services.
Photograph courtesy of Uber Eats

Philadelphia this week became the latest city to cap the fees charged to restaurants by third-party delivery companies. 

The law signed Monday caps total fees on delivery orders at 15%. Delivery commissions can be no higher than 10% of the order total, and separate nondelivery fees can't exceed 5%.

It also requires delivery companies to disclose to the customer all fees being charged to the restaurant and bans the providers from using a restaurant’s likeness or trademark without permission. 

The coronavirus pandemic has inflamed tensions between restaurants and delivery services. Restaurants depended on them heavily during the widespread shutdown of dining rooms, but have raged against commissions that can rise to 30% or more. Cities including New York, LA, San Francisco, Oakland, Portland, Ore., and Washington, D.C., have responded by limiting the fees to make things easier on struggling restaurants.

Philly’s law is effective immediately and will last until 90 days after the end of a "public health emergency" such as the pandemic. Delivery services that don't comply face a $300 fine.

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