New York City has quietly opened a new front in policing food delivery platforms after reports that regulators reached a settlement with the app HungryPanda over how it bills restaurants. The development signals a shift beyond the high profile enforcement of courier pay toward scrutinizing the business practices that determine what restaurants actually pay to appear on apps. For eateries already squeezed by commissions and rising rents, the change could mean refunds, sharper audits and tighter contract scrutiny.
As reported by Crain's New York Business, the Department of Consumer and Worker Protection reached the HungryPanda settlement this week to resolve complaints about restaurant facing fees and disclosures. The Crain's story frames the deal as one of the first concrete enforcement outcomes aimed directly at merchant billing practices rather than only at courier pay.
The move follows a city enforcement streak earlier this year: platforms were already on notice after a Jan. 30 announcement that DCWP secured more than $5.19 million in restitution from Uber Eats, Fantuan and HungryPanda for minimum pay violations. Gothamist covered that settlement and quoted city officials saying the administration would use data monitoring to spot and fix violations.
What this means for restaurants
New York law caps the commissions and transaction fees that third party delivery services can charge merchants, and it gives regulators tools to force refunds or levy penalties when apps exceed those limits. The city's own data shows how big a bite fees can take: DCWP's aggregated report found merchant fees accounted for roughly 19% of order subtotals in its Q1 2024 dataset, a reminder of why restaurants pushed for tighter oversight. The Department of Consumer and Worker Protection and the City Council's ordinance text lay out the reporting and cap framework that now underpins enforcement.
Enforcement widens
City officials have signaled they will pair monthly app reporting with targeted audits and legal action. Earlier this year DCWP filed a suit against Motoclick and issued compliance warnings to dozens of platforms as part of a broader compliance blitz, a step that advocates and local outlets flagged as the administration moving from rule making to active policing. amNewYork and other outlets covered the Motoclick case when it was filed.
What restaurants should do now
Operators that use delivery platforms should review written agreements, check whether fees charged match the city's caps, and preserve billing records for disputed orders. Merchants who suspect overcharges can file complaints with DCWP and follow the agency's guidance for restaurant partners on enforcement and refunds. The Department of Consumer and Worker Protection explains the complaint process and what relief the city can pursue.
Legal implications
The fee caps and stepped up enforcement sit inside an active legal battle: the major platforms sued the city over commission limits in 2021, and courts have allowed key claims to move forward, meaning platforms face both regulatory penalties and ongoing litigation risk. That dual track of enforcement plus lawsuits will shape how quickly companies change contract terms, pricing models and disclosures. RestaurantBusiness reviewed the litigation posture, and the City Council's legislation text explains the statutory caps and reporting obligations. City Council legislation spells out the fee limits and compliance requirements.
For now, the HungryPanda settlement functions as a clear signal: regulators are moving beyond wage restitution and into merchant level enforcement, and restaurants and apps alike should expect closer scrutiny of billing, disclosure and contract practices in the months ahead.
