Ontario moves to cap delivery app fees in regions where indoor dining banned

·2 min read

TORONTO — Ontario is moving to cap the fees third-party delivery apps impose on restaurants in regions where indoor dining is prohibited. 

The associate minister of small business says 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.

Prabmeet Sarkaria says companies who contravene the proposed law could face fines of up to $10 million.

He says restaurants can expect to see a cap of 15 per cent on delivery fees -- similar to what was done in New York City, which recently capped delivery app commission fees at 20 per cent to help restaurants weather the pandemic.

The bill also aims to protect the pay of delivery drivers and ensure companies don't restrict their delivery zones or cut out certain restaurants. 

The proposed law is meant to provide temporary relief to restaurants that are now forced to rely on delivery and takeout orders as their only source of revenue due to COVID-19 restrictions barring indoor service. 

Many restaurants across Ontario have struggled to stay afloat during the pandemic, particularly amid rapidly changing public health rules affecting capacity and hours of operation.

Recently imposed 28-day lockdowns in Toronto and neighbouring Peel Region have meant restaurants in those areas are closed to all but takeout and delivery orders, prompting some to push back against the rules.

One west Toronto restaurant was shut down by city officials earlier this week after they say it was found to be serving customers on site.

Premier Doug Ford has repeatedly urged delivery apps to cut their commission fees in light of the pandemic. 

Sarkaria noted that SkipTheDishes did so voluntarily. 

The legislation, if passed, would apply to the largest delivery companies in the province.

This report by The Canadian Press was first published Nov. 26, 2020.

Paola Loriggio and Nicole Thompson, The Canadian Press