UPDATE: Province to cap third-party delivery fees for restaurants

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Ontario is set to cap the fees third-party delivery apps impose on restaurants in regions where indoor dining is prohibited, in a bid to protect what profits restaurants can still make during the COVID-19 pandemic.

 The Progressive Conservative government will table legislation today that would give the province the authority to temporarily limit how much apps such as UberEats and DoorDash can charge restaurants in the grey or lockdown COVID-19 restriction zone for their services, the associate minister of small business told a news conference.

``Ontario's restaurants have been bearing an incredible brunt of the financial burden of this pandemic. Some restaurants have seen traffic plummet by as much as 90 per cent,'' Prabmeet Sarkaria said.

``At the same time, food delivery services companies have collected up to 30 per cent in commissions from these restaurants. And they're enjoying record sales and uptake.''

He said restaurants can expect to see a cap of 15 per cent on delivery fees, with a cap of 20 per cent inclusive of all fees.

It's similar to what was done in New York City, which recently capped delivery app commission fees at 20 per cent.

CEO of Skip The Dishes responded to NEWSTALK 1010's interview request, with a statement:

We are glad the Ontario government recognizes the work SkipTheDishes has been doing since March to support our restaurant partners. SkipTheDishes is a proud Canadian brand, and since the start of the pandemic we’ve worked tirelessly beside our restaurant partners and have proactively provided them with over $30 million dollars in industry leading support since March, months before being called upon by Premier Ford or Mayor Tory to do so.

When taking into account the 25% commission rebate we have implemented in affected regions of the province, all local, independent restaurant partners on the SkipTheDishes platform are already paying less than 20% in commission while their dining rooms are closed.

Since the start of the pandemic, SkipTheDishes has provided industry-leading support, which includes:

  • 25% commission rebate to our local, independent restaurant partners to help when they need it most
  • 0% commission rate for new restaurants joining the network during the lockdown period
  • 10% commission rate to any restaurant on Skip looking to utilize staff to facilitate their own delivery, connecting over 30,000 restaurants with millions of customers across the country
  • Additional marketing and order-driving initiatives to drive repeat orders and attract new customers for our restaurant partners, increasing incremental revenue
  • Streamlining our restaurant onboarding process, so that new partners join the network 40% faster
  • The continuation of our restaurant tipping initiative, which has seen over $1.2 million in generous donations from Skip customers go directly to local restaurants

We have been working directly with all levels of government in Ontario over the last few months on ways we can work together to best support the restaurant industry, and look forward to continuing those discussions over the next few weeks.