San Marino Municipal Code Art. 19 Third-Party Food Delivery Service Fees

For purposes of this Article, the following definitions apply:

DELIVERY FEE: 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 establishment to customers. The term does not include any other fee or cost that may be charged by a third-party food delivery service to a retail food establishment, such as fees for listing or advertising the retail food establishment on the third-party food delivery service platform or fees related to processing the online order including, but not limited to service fees, fees for facilitating online orders for pick-up, and credit card processing fees.

ONLINE ORDER: An order placed by a customer, including a phone order, for delivery or pick-up from a retail food establishment located within the City.

PURCHASE PRICE: The menu price of 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. Such term therefore excludes taxes, gratuities and any other fees or costs that may make up the total amount charged to the customer of an online order.

RETAIL FOOD ESTABLISHMENT: 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 within the City of San Marino.

THIRD-PARTY FOOD DELIVERY SERVICE: 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, no fewer than twenty (20) separately owned and operated food service establishments wherever situated, including outside the boundaries of the City of San Marino.

(Ord. O-20-1375, 2-10-2021)

It shall be unlawful for a third-party food delivery service to do the following:

A. Charge a retail food establishment a delivery fee that totals more than fifteen percent (15%) of the purchase price of each online order.

B. 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.

C. Charge a retail food establishment any amount or combination of fees, commissions, or costs for the retail food establishment's use of the third-party food delivery service, unless the contract between the retail food establishment and the third-party food delivery service allows for charges for such fees, commissions, and costs (other than a delivery fee), in which case such fees, commissions or costs shall not exceed five percent (5%) of the purchase price of each online order. For the purpose of this subsection A., fees, commissions, or costs do not include the delivery fee, which is capped at fifteen percent (15%) as set forth in paragraph a above.

D. Charge a retail food establishment any fee, commission, or cost other than as permitted in subsections A. through C., above.

E. Charge a customer any purchase price for a food or beverage item that is higher than the price imposed by the retail food establishment on the third-party food delivery service or, if no price is imposed by the retail food establishment on the third-party food delivery service, the price listed on the retail food establishment's own menu.

F. Retain any portion of amounts designated as a tip or gratuity. Any tip or gratuity shall be paid by the third-party food delivery service, in its entirety, to the person delivering the food or beverages.

(Ord. O-20-1375, 2-10-2021)

The third-party food delivery service shall disclose to the customer an accurate, clearly identified, and itemized cost breakdown of each transaction, including, but not limited to the following:

A. The purchase price of the food and beverages at the cost listed on the retail food establishment's menu;

B. The delivery fee charged to the retail food establishment;

C. Each fee, commission, or cost, other than a delivery fee, charged to the retail food establishment;

D. Each fee, commission, or cost, other than the delivery fee or the purchase price of the food, charged to the customer by the third-party food delivery service;

E. Any tip or gratuity that will be paid to the person delivering the food or beverages.

(Ord. O-20-1375, 2-10-2021)

If a third-party food delivery service charges a retail food establishment fees that violate this Article, the retail food establishment may provide written notice to the third-party food delivery service requesting a refund within seven (7) days. If the third-party food delivery service does not provide the refund requested after seven days or the third-party food delivery service continues to charge fees in violation of this Article after the initial notice and seven (7) day cure period, a retail food establishment may enforce this Article by means of a civil action seeking damages and injunctive relief. The prevailing party in any such action shall be entitled to an award of reasonable attorney fees.

(Ord. O-20-1375, 2-10-2021)