New York City officials announced a settlement of more than $875,000 with London-based food delivery platform HungryPanda regarding violations of the city’s Third-Party Food Delivery Service Laws April 8.
The action represents the NYC Department of Consumer and Worker Protection’s first time enforcing the law against a delivery app company for harming business owners, according to an April 8 release from the DCWP.
City leaders, including Mayor Zohran Mamdani, Council Member Shahana Hanif and DCWP commissioner Sam Levine, used the opportunity to send a message that the city will use the laws to protect small business owners.
“We are putting a warning to all delivery apps that we will not be defrauded, we will catch you, and we will make sure that you pay,” Hanif said in a release. “That accountability in the city is front and center, and anyone trying to hurt our small businesses, our workers, will be in trouble.”
The DWCP stated HungryPanda, a third-party delivery platform primarily used in NYC’s Asian immigrant communities, will pay more than $580,000 in restitution to more than 380 restaurants across the city, along with upwards of $294,000 in civil penalties and fees. The department asserted that the company used tactics to impose unlawful charges, such as bundling multiple fees into a single line item, frequently relabeling fees and mischaracterizing illegal overcharges as “promotion deductions.”
As a result of the settlement, DCWP stated HungryPanda must comply with the Fee Cap Law, including measures like providing clear fee disclosures to restaurants, implementing internal compliance policies and training, and submitting annual certifications attesting to compliance.
“Throughout this process, HungryPanda has engaged constructively with the regulator and has continued to review and refine its operations to meet evolving local requirements,” stated a release from HungryPanda, according to April 9 reporting from ABC7 New York. “The company remains committed to supporting merchants and delivery workers, maintaining compliant operations, and serving New York City’s diverse communities.”
Levine, who leads the DCWP, described NYC restaurants as critical to the city’s economy, and said the settlement sets a precedent for future Fee Cap Law violations.
“Restaurants are the heart of every New York City neighborhood, bringing people together, keeping us fed and creating a thriving economy,” Levine said in a release. “The Fee Cap Law was enacted to protect these small businesses from predatory fees that make operating in New York City difficult. This settlement lets it be known that DCWP will not allow HungryPanda, or any other delivery app for that matter, to rip off consumers, workers, or small businesses.”
The Third-Party Food Delivery Service Laws generally cap fees by delivery apps at 15 percent for delivery services, 5 percent for basic services and 3 percent for electronic payment processing.
In January, HungryPanda, alongside Uber Eats and Fantuan, was part of a $5 million settlement concerning violations of the city’s minimum pay rate. That action secured restitution, penalties and damages for more than 49,000 delivery workers
