Long Beach Municipal Code Ch. 5.95 Third-Party Food Delivery Service Fees

Footnotes:

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Editor's note— ORD-26-0008 § 1, adopted April 21, 2026, amended Ch. 5.95 in its entirety to read as herein set out. Former Ch. 5.95, §§ 5.95.010—5.95.050, pertained to similar subject matter, and derived from ORD-21-0005(Emerg.) § 1, 2021.

The use of third-party food delivery platforms is widespread throughout the City of Long Beach. In addition to fees that may be charged to the customer, the food delivery platforms also charge fees to restaurants. These restaurants have limited bargaining power to negotiate lower fees with the food delivery platforms and must accept these fees or risk closure. Restaurants are essential to the public health and welfare, and additionally help the local economy by providing jobs and serving as commercial anchors in neighborhoods across the City of Long Beach. This ordinance places a fifteen percent (15%) cap on the fees a food delivery platform may charge restaurants for basic delivery and listing services, while allowing food delivery platforms to charge additional fees to restaurants for additional services.

(ORD-26-0008 § 1, 2026)

A. "City" means the City of Long Beach.

B. "Delivery Fee" means a fee charged by a Third-Party Food Delivery Service for providing a Retail Food Establishment with a service that delivers food and beverages from such establishments to customers. The term does not include any other fee or cost that may be charged by a Third-Party Delivery Service to a Retail Food Establishment, such as fees for listing, marketing, or advertising the Retail Food Establishment on the Third-Party Food Delivery Service platform or fees related to processing the Online Order.

C. "Online Order" means an order placed by a customer through or with the assistance of a platform provided by a Third-Party Food Delivery Service, including a telephone order, for delivery or pick-up within the City.

D. "Purchase Price" means the price, as listed on the menu of the Retail Food Establishment, for the items contained in an Online Order, minus any applicable coupon or promotional discount provided to the customer by the Retail Food Establishment through the Third-Party Food Delivery Service. This definition does not include taxes, gratuities, and any other fees or costs that may make up the total amount charged to the customer of an Online Order.

E. "Core delivery service" means a service that: (1) lists a Retail Food Establishment, and makes the Retail Food Establishment discoverable, on all modalities or platforms offered by a Third-Party Food Delivery Service, including but not limited to any website, mobile application, or other internet service where a Third-Party Food Delivery Service lists Retail Food Establishments, and (2) facilitates and/or performs the delivery (through employees or independent contractors of the Third-Party Food Delivery Service and/or such establishments) of food and/or beverages from Retail Food Establishments to customers. Core delivery service does not include any other service that may be provided by a Third-Party Food Delivery Service to a Retail Food Establishment, including but not limited to advertising services, search engine optimization, business consulting, or credit card processing.

F. "Retail Food Establishment" means a restaurant, delicatessen, bakery, coffee shop, or other eat-in or carry-out service of processed or prepared raw and ready-to-eat food or beverages.

G. "Third-Party Food Delivery Service" means any website, mobile application, or other internet service that offers or arranges for the sale of food and beverages prepared by, and the delivery or pick-up of food and beverages from, Retail Food Establishments located in the City.

(ORD-26-0008 § 1, 2026)

A. No Third-Party Food Delivery Service may charge a Retail Food Establishment a fee, commission, or charge per online order that totals more than fifteen percent (15%) of the total Purchase Price of the Online Order.

B. No Third-Party Food Delivery Service may charge a Retail Food Establishment a fee, commission, or charge that exceeds fifteen percent (15%) of the total Purchase Price of Online Orders to that Retail Food Establishment processed through the Third-Party Food Delivery Service during the time period covered by the fee, commission, or charge.

C. Beginning on January 1, 2026, the fee limits in subsections (A) and (B) of this Section 5.95.030 shall not apply to a Third-Party Food Delivery Service that does both of the following:

1. offers all Retail Food Establishments the option to obtain core delivery service for a total fee, commission, or charge not to exceed 15% of the Purchase Price of the Online Order, without requiring the purchase of additional services; and

2. no later than December 1, 2026, notifies all Retail Food Establishments that have an existing contract with the Third-Party Delivery Service of the option described in subsection (C)(1).

D. Contracts between a Third-Party Food Delivery Service and a Retail Food Establishment shall clearly define the fees, commissions, or charges associated with contracted services. For example, if a Retail Food Establishment enters into a contract with a Third-Party Food Delivery Service for core delivery service only, that contract shall clearly state a fee, commission, or charge of 15% of the Purchase Price for core delivery service.

E. It shall be unlawful for a Third-Party Food Delivery Service to charge a Retail Food Establishment any amount designated as a Delivery Fee for an Online Order that does not involve the delivery of food or beverages.

F. It shall be unlawful for a Third-Party Food Delivery Service to charge a customer any Purchase Price for a food or beverage item that is higher than the price set by the Retail Food Establishment on the Third-Party Food Delivery Service platform or, if no price is set by the Retail Food Establishment on the Third-Party Food Delivery Service platform, the price listed on the Retail Food Establishment's own menu.

G. It shall be unlawful for a Third-Party Food Delivery Service to reduce the compensation rates paid to the Third-Party Food Delivery Service drivers, or to garnish gratuities, as a result of any fee limitations instituted by this section.

(ORD-26-0008 § 1, 2026)

At the time a final price is disclosed to a customer for the intended purchase and delivery of food from a restaurant through a Third-Party Food Delivery Service and before that transaction or Online Order is completed by the customer, the Third-Party Food Delivery Service shall disclose to the customer, in plain language and in a conspicuous manner, any commission, fee, or any other monetary payment charged to the customer by the Third-Party Food Delivery Service.

(ORD-26-0008 § 1, 2026)

Each day that a violation continues shall constitute a separate and distinct offense. A violation of this Chapter is subject to the following:

A. An action in the Superior Court of the State of California to recover actual damages resulting from a violation of this Chapter.

B. Reasonable attorneys' fees and costs awarded by a court to a plaintiff that prevails in an action against a Third-Party Food Delivery Service. If a plaintiff fails to prevail against a Third-Party Food Delivery Service, a court may award reasonable attorneys' fees and costs to the Third-Party Food Delivery Service upon a determination by the court that the plaintiff's action was frivolous.

C. A civil action alleging a violation of any provision of this article shall commence only after the following requirements have been met:

1. Written notice is provided to the Third-Party Delivery Service of the provisions of the Chapter alleged to have been violated and the facts to support the alleged violation; and

2. The Third-Party Food Delivery Service is provided at least 15 days from the date of the written notice to cure any alleged violation.

D. A criminal penalty for each offense pursuant to Chapter 1.32 of this Code.

(ORD-26-0008 § 1, 2026)

In enacting this Ordinance, the City Council intends to amend only those words, phrases, paragraphs, subsections, sections, articles, numbers, punctuation marks, charts, diagrams, or any other constituent parts of the Municipal Code that are explicitly shown in this ordinance as additions, deletions, City Council amendment additions, and City Council amendment deletions in accordance with the "Note" that appears under the official title of the ordinance.

(ORD-26-0008 § 1, 2026)