Bill Text: NY A11128 | 2019-2020 | General Assembly | Introduced


Bill Title: Limits third-party food delivery service charges during COVID-19.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced - Dead) 2020-11-06 - referred to consumer affairs and protection [A11128 Detail]

Download: New_York-2019-A11128-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          11128

                   IN ASSEMBLY

                                    November 6, 2020
                                       ___________

        Introduced  by  COMMITTEE ON RULES -- (at request of M. of A. Rodriguez)
          -- read once and referred to the Committee  on  Consumer  Affairs  and
          Protection

        AN  ACT  to  amend  the general business law, in relation to third-party
          food delivery service charges during COVID-19; and providing  for  the
          repeal of certain provisions upon the expiration thereof

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Legislative findings and  intent.  The  legislature  hereby
     2  finds  that  on March 7, 2020, the governor of New York declared a state
     3  of emergency related to the COVID-19 pandemic; and  has  issued  various
     4  emergency   directives  related  to  the  COVID-19  pandemic  that  have
     5  restricted the ability of restaurants and other food providers to  fully
     6  operate their businesses.
     7    These  social  distancing  measures required to mitigate the spread of
     8  COVID-19 means that delivery and take-out options from  restaurants  and
     9  other  food establishments are critical to the public's accessibility of
    10  food and addressing any community food insecurity.
    11    Restaurants and other food  establishments  are  restricted  in  their
    12  ability  to  fully  utilize their dine-in capabilities and the resultant
    13  reliance on take-out and delivery service places  a  sudden  and  severe
    14  financial  strain  on  many  establishments, particularly those that are
    15  small, independently owned or  minority-owned  businesses  that  already
    16  operate  on  thin margins. Adding to financial pressures in the industry
    17  that predate the current public health  crisis,  it  is  in  the  public
    18  interest to take action to maximize restaurant revenue from delivery and
    19  pick-up  orders to enable these businesses to survive the impacts of the
    20  COVID-19 pandemic  and  continue  supporting  a  diverse  workforce  and
    21  contributing to the vitality of our community.
    22    Therefore,  it  is the intent of the legislature to create a statewide
    23  policy and fee structure for third-party food delivery  services  during
    24  the  state declared COVID-19 emergency while food service establishments
    25  have capacity restrictions.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD17385-04-0

        A. 11128                            2

     1    § 2. The general business law is amended by adding a new section 391-v
     2  to read as follows:
     3    § 391-v. Third-party food delivery service charges during COVID-19. 1.
     4  Definitions.    For  purposes of this section, the following terms shall
     5  have the following meanings:
     6    (a) "Declared emergency" means the period during which a state  disas-
     7  ter  emergency has been declared by the governor that results in limita-
     8  tions on on-premises dining for restaurants as a result of the  COVID-19
     9  pandemic.
    10    (b)  "Delivery fee" means a fee charged by a third-party food delivery
    11  service for providing a food service establishment with a  service  that
    12  delivers  food  from such establishment to customers. Delivery fee shall
    13  not include any other fee that may be  charged  by  a  third-party  food
    14  delivery  service  to  a  food  service establishment, including but not
    15  limited to, fees for listing or advertising the food service  establish-
    16  ment  on  the third-party food delivery service platform or fees related
    17  to processing the online order.
    18    (c) "Food service establishment" means a place where food is  prepared
    19  and  intended  for  individual  portion service and includes the site at
    20  which such individual portions are provided, whether consumption  occurs
    21  on  or  off  the  premises. Food service establishment shall not include
    22  food processing establishments, retail food stores, private homes  where
    23  food  is  prepared  or  served  for family consumption, and food service
    24  operations where a distinct group mutually  provides,  prepares,  serves
    25  and  consumes  the  food,  including  but not limited to, a covered-dish
    26  supper limited to a congregation, club or fraternal organization.
    27    (d) "Online order" means any order placed by a  customer  through,  or
    28  with the assistance of, a platform provided by a third-party food deliv-
    29  ery service, including but not limited to, a telephone order.
    30    (e)  "Purchase  price" means the total price of the items contained in
    31  an online order that are listed on the menu of the food  service  estab-
    32  lishment  where  such order is placed.  Purchase price shall not include
    33  taxes, gratuities and any other fees that may make up the total cost  to
    34  the customer of an online order.
    35    (f)  "Third-party  food  delivery  service"  means any website, mobile
    36  application or other internet service that offers or  arranges  for  the
    37  sale  and  same-day  delivery  or  same-day pickup of food and beverages
    38  prepared by no fewer than twenty food service establishments located  in
    39  the state that are owned and operated by different persons.
    40    2.  Fee  limits  during  declared emergencies. (a) No third-party food
    41  delivery service shall charge a food service establishment any  combina-
    42  tion  of  fees, commissions or costs, including a delivery fee, for such
    43  third-party food delivery service's services that total more than twenty
    44  percent of the purchase price of an online order plus credit card  proc-
    45  essing fees.
    46    (b)  No  third-party food delivery service shall charge a food service
    47  establishment a delivery fee that totals more than  fifteen  percent  of
    48  the purchase price of an online order.
    49    (c)  No  third-party  food  delivery  service shall reduce the compen-
    50  sation, including but not limited to, any tip or gratuity, paid  to  any
    51  worker as a result of fees charged during the declared emergency.
    52    3.  Penalties  and enforcement. Whenever there shall be a violation of
    53  this section, an application may be made by the attorney general in  the
    54  name of the people of the state of New York to a court or justice having
    55  jurisdiction  to  issue an injunction to enjoin and restrain the contin-
    56  uance of such violation; and if it shall appear to the  satisfaction  of

        A. 11128                            3

     1  the  court  or  justice  that  the defendant has, in fact, violated this
     2  section, an injunction may be issued by such court or justice, enjoining
     3  and restraining any further violation, without requiring proof that  any
     4  person  has,  in  fact,  been  injured  or  damaged thereby. In any such
     5  proceeding, the court may make allowances to the  attorney  general  and
     6  direct  restitution  of  an  amount  not  to  exceed  the amount of fees
     7  collected in violation of this section by a  third-party  food  delivery
     8  service,  attorneys' fees, and such other remedies as the court may deem
     9  appropriate. Whenever the court shall determine that a violation of this
    10  section has occurred, the court may impose a civil penalty of  not  more
    11  than  one  thousand  dollars for each violation. Each day a violation of
    12  this section is continued and each food service establishment charged  a
    13  fee  in violation of this section shall constitute a separate violation.
    14  In connection with any such proposed application the attorney general is
    15  authorized to take proof and make a determination of the relevant  facts
    16  and  to  issue  subpoenas  in accordance with the civil practice law and
    17  rules.
    18    4. Preemption.  At all times, whether or not a declared  emergency  is
    19  in  effect,  the  provisions of this section shall supersede and preempt
    20  any county or municipal or other local law,  ordinance,  resolution,  or
    21  regulation concerning the relationship between a third-party food deliv-
    22  ery service and any food service establishment utilizing its services.
    23    §  3. This act shall take effect seven days after it shall have become
    24  a law provided that section one of this act and subdivisions 1, 2 and  3
    25  of  section 391-v of the general business law as added by section two of
    26  this act shall expire and be deemed repealed upon the expiration of  the
    27  declared  state  of  emergency relating to the novel coronavirus (COVID-
    28  19);  and  provided,  further,  that  the  superintendent  of  financial
    29  services  shall  notify  the  legislative  bill drafting commission upon
    30  occurrence of the expiration of the state disaster emergency declared by
    31  executive order number 202 and any further amendments or  modifications,
    32  and  as  may be further extended pursuant to section 28 of the executive
    33  law, in order that the commission may maintain an  accurate  and  timely
    34  effective data base of the official text of the laws of the state of New
    35  York  in furtherance of effectuating the provisions of section 44 of the
    36  legislative law and section 70-b of the public officers law.
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