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A1019
ASSEMBLY, No. 1019
STATE OF NEW JERSEY
222nd LEGISLATURE
�
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Assemblyman BALVIR SINGH
District 7 (Burlington)
SYNOPSIS
���� Limits service fees charged to restaurants by
third-party food takeout and delivery applications.
CURRENT VERSION OF TEXT
���� Introduced Pending Technical Review by Legislative
Counsel.
��
An Act
limiting certain third-party food takeout and delivery
application service fees charged to restaurants and amending P.L.2020, c.42.
����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:
���� 1���� (New section)� a.� As
used in this section, "third-party food takeout and delivery service
application or Internet website" means any third-party online food
ordering and delivery service that allows a consumer to place an order for
takeout or delivery from a restaurant but shall not include any website that is
owned, controlled, or managed by the restaurant itself.
���� b.��� Notwithstanding the
provisions of section 2 of P.L.2020, c.42 (C.56:8-226), it shall be an unlawful
practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) for any
third-party food takeout and delivery service application or Internet website
to charge a service fee to a restaurant for food take-out or delivery orders
that is:
���� (1)� greater than 20 percent
of the cost of the individual order; or
���� (2)� greater than 10 percent
of the cost of the individual order, when the order is delivered by an employee
of the restaurant or an independent contractor with whom the restaurant has
contracted directly.
���� The provisions of this section
shall not be construed to limit the ability of any restaurant to choose to pay
up to 25 percent of the cost of the individual order to access additional
advertising or other products and services offered by any third-party food
takeout and delivery service application or Internet website.�
���� c.��� The provisions of this
section shall supersede and preempt any county or municipal law, ordinance,
resolution, or regulation concerning the relationship between third-party food
takeout and delivery service applications or Internet websites and any restaurant
utilizing its services.
���� d.��� The provisions of
section 2 of P.L.2020, c.42 (C.56:8-226) shall not apply while this section is
operational.
���� e.��� Within 24 months of the
effective date of this act, the Director of the Division of Consumer Affairs
shall report to the Governor, and to the Legislature pursuant to section 2 of
P.L.1991, c.164 (C.52:14-19.1), on the impact of this act on restaurants, consumers,
and third-party food takeout and delivery service applications or Internet
websites and make a recommendation as to whether this act should be permanently
adopted.�
���� 2.��� Section 2 of P.L.2020,
c.42 (C.56:8-226) is amended to read as follows:
���� 2.��� a.� It shall be an
unlawful practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) for any
third-party food takeout and delivery service application or Internet website,
during and until the first day of the third month following any state of emergency
declared by the Governor in response to COVID-19 that restricts restaurant
dine-in service to less than 25 percent of the maximum capacity allowed by law,
to charge a service fee to a restaurant for food take-out or delivery orders
that is:
���� (1)� greater than 20 percent
of the cost of the individual order; or
���� (2)� greater than 10 percent
of the cost of the individual order, when the order is delivered by an employee
of the restaurant or an independent contractor with whom the restaurant has
contracted directly.
���� The provisions of this section
shall not be construed to limit the ability of any restaurant to choose to pay
up to 25 percent of the cost of the individual order to access additional
advertising or other products and services offered by any third-party food
takeout and delivery service application or Internet website.� However, any
restaurant that chooses to pay a service fee that is greater than the fee set
forth in the provisions of this section shall be required to affirmatively
elect to pay that fee regardless of any contract that is in effect on the
effective date of this act unless the contract was entered into prior to the
state of emergency declared by the Governor pursuant to Executive Order No. 103
of 2020.
���� b.���
(1)
������ The
provisions of this section shall supersede and preempt any county or municipal
law, ordinance, resolution, or regulation concerning the relationship between
third-party food takeout and delivery service applications or Internet websites
and any restaurant utilizing its services.
����
(2)� The provisions of this
section shall not apply while the provisions of section 1 of
P.L.��� , c.��� (C.������� ) (pending before the
Legislature as this bill) are operational.
���� c.��� As used in this section,
"third-party food takeout and delivery service application or Internet
website" means any
third-party
online food ordering and delivery
service that allows a consumer to place an order for takeout or delivery from a
restaurant
but shall not include any website that is owned, controlled, or
managed by the restaurant itself
.
(cf: P.L.2020, c.42, s.2)�
���� 3.��� This act shall take
effect immediately and shall expire on the first day of the twenty-fifth month
following the date of enactment.�
STATEMENT
���� This bill would make it an unlawful practice for any
third-party food takeout and delivery service application or website to charge
a service fee to a restaurant that is: 1) greater than 20 percent of the cost
of the individual order; or 2) greater than 10 percent of the cost of the
individual order, when the order is delivered by an employee of the restaurant
or an independent contractor with whom the restaurant has contracted directly.�
����� This bill does not limit the ability of any
restaurant to choose to pay up to 25 percent of the cost of the individual
order to access additional advertising or other products and services offered
by the third-party application or website.
����� The bill defines �third-party food takeout and
delivery service application or Internet website� to mean any third-party online
food ordering or delivery service that allows a consumer to place an order for
takeout or delivery from a restaurant but does not include any website that is
owned, controlled, or managed by the restaurant itself.�
����� The provisions of this bill are to take effect
immediately and expire on the first day of the twenty-fifth month following the
date of enactment.� During this time, the Director of the Division of Consumer
Affairs is required to report to the Governor and the Legislature on the impact
of the bill on restaurants, consumers, and third-party food takeout and
delivery service applications or Internet websites and make a recommendation on
whether the limit on service fees should be permanently adopted.�
����� An unlawful practice under the consumer fraud act,
P.L.1960, c.39 (C.56:8-1 et seq.), is punishable by a monetary penalty of not
more than $10,000 for first offense and not more than $20,000 for any
subsequent offense.� In addition, a violation can result in a cease and desist
order issued by the Attorney General, the assessment of punitive damages, and
the awarding of treble damages and costs to the injured.�
����� During the COVID-19 pandemic, similar legislation
(P.L.2020, c.42, C.56:8-226) was adopted in order to ease the financial burden
on restaurants that resulted from the limitations that were placed on indoor
dining to help slow the spread of the virus.� That legislation became inactive
when the state of emergency was lifted in March 2022.�
��