St. Louis capped delivery fees charged to restaurants

Last July, city councils unanimously approved legislation to cap fees. Third-party delivery services could charge restaurants 20%.

ST. LOUIS – Food Delivery Apps are demanding more money from customers in the city of St. Louis after lawmakers put regulations in place to help restaurants amid the pandemic.

Last July, city councils unanimously approved legislation to cap fees. Third-party delivery services could charge restaurants 20%. The bill also stipulated that the services would disclose what portion of the tips the drivers actually received. It’s until sunset, 60 days after the city’s health pandemic ends.

The bill’s main sponsor, Alderwoman Christine Ingrassia, said during a meeting in July that it was about “helping (restaurants) stay afloat during the pandemic”.

However, at least two of the services have started charging additional fees for residents’ bills – and they are blaming local authorities for doing this.

DoorDash Inc. (NYSE: DASH) calls the $ 1 fee a “St. Louis Fee”.

“St. Louis has temporarily capped the fees we may charge for local restaurants,” the app explains. “To continue providing you with convenient delivery while ensuring Dashers are active and making money, a fee is now being added to orders in St. Louis.”

Similarly, Uber Eats (NYSE: UBER), which didn’t respond to a request for comment, says that its $ 1 add-on “may include other fees in addition to the cost of government fees and regulations on apps for delivery.” of food to balance “.

A DoorDash spokeswoman said in a statement that “operating our platform, paying for and insuring dashers and the resulting high quality service can be expensive, which is why we are starting to do so in many markets where local governments have price regulations have to charge customers a small additional fee. “

“We understand that this is not ideal, but with these regulations in place, these fees help us continue to provide convenient delivery for customers, meaningful income opportunities for dashers, and valuable services that help drive orders for merchants,” said the Spokeswoman.

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