As of today, the Ontario government is capping third-party delivery service fees in areas where indoor dining is prohibited.
This comes after the provincial government tabled the Supporting Local Restaurants Act in late November as a way to support struggling restaurants weathering the pandemic.
"This holiday season, let's support local restaurants by getting takeout, ordering delivery, or buying gift cards for family and friends,” said Prabmeet Sarkaria, the associate minister of small business.
"We're all in this together. Food delivery companies, consumers and communities are all part of the solution."
Food delivery companies, such as Uber Eats and DoorDash, will be required to limit their commission rates to 20 per cent on each transaction with a 15 per cent cap on food delivery services.
The cap will be active in areas where indoor dining is prohibited. It will also apply to any new regions where indoor dining becomes banned.
The government is also ensuring that employees and contractors performing food delivery services will not see reduced pay in response to the new law.
Companies that do not comply with the new cap could face up to $10 million in fines.
Food delivery services have been one of the larger threats to small restaurants operating during the pandemic. High commission rates have collapsed profits for businesses who have no other option than to partner with third-party delivery services to stay afloat.
Hopefully, the provincial government’s new plan to support local restaurants will be a breath of fresh air.
Ontario has done what it can to support small, local restaurants throughout the pandemic––most recently announcing that restaurants will now be permanently allowed to sell alcohol with takeout orders.
“By giving to the people who mean so much to us, we can give back to the restaurants that make our main streets bright," said Sarkaria.
