-
Local and federal regulators are cracking down on junk fees on food delivery platforms.
-
As regulators target fees, experts say the deeper issue is platform power and dependency.
-
Proposed regulations from the government could have a ripple effect on ticketing and travel sites.
A growing crackdown on delivery apps is taking shape across America.
Federal regulators are weighing new rules. Lawmakers are investigating price-fixing deals between big companies. And earlier this month in New York City, Mayor Zohran Mamdani announced a nearly $1 million deal with the delivery app over its fee structure and vowed to keep the momentum going.
Taken together, the moves point to something bigger than frustration over “junk fees.” They signal a wider effort to examine how prices are set – and who actually controls them – in the delivery economy.
However, “the fee structure question is the easy part,” said Jackie Swanson, a retail and consumer goods strategist and managing partner at Gartner Consulting.
The Federal Trade Commission took a major step this week to regulate delivery fees nationwide, seeking public comment on “unfair or deceptive fee practices” in online food and grocery delivery services, according to the agency.
The inquiry targets familiar frustrations: charges that appear late in the checkout process, or pricing that differs from what consumers expected in advance.
“Clear and truthful pricing is essential to competitive markets,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said in the agency’s announcement.
The FTC is asking that companies first disclose total prices, explain the purpose of the fees, and clarify when pricing varies among users, according to a Federal Register notice.
“A key issue to watch in this rulemaking is how the FTC defines ‘fees’ and the scope of covered services,” M. Scott Vinson, a policy and regulatory affairs consultant and former vice president of the National Retail Federation, told Business Insider.
A broader definition could push companies across industries toward all-in pricing and clear upfront disclosure, Vinson said. The focus has been on delivery platforms like DoorDash and Uber Eats, but the FTC regulation could impact other direct-to-consumer models that rely on tiered fees, such as travel booking and ticketing sites.
Representatives for DoorDash and Uber Eats did not respond to requests for comment from Business Insider.
A similar dynamic is emerging in ticketing, where a recent Justice Department settlement with Live Nation includes $280 million in fines, fee caps, and new transparency requirements — signaling how regulators may reach pricing structures beyond delivery apps.
“Whether or not it goes to a proposed rule — and how far it goes — will depend on that process,” Vinson said, adding that the process is still in its early stages.
Michael Goldberg, a Case Western Reserve University professor who studies entrepreneurship and venture finance, said the effort reflects a broader push to benefit consumers.
“We’ve all been in situations where you don’t see the charge until later, or the price of the food is much higher than it would be at the store,” he said.
And the timing is not accidental. Tariffs have become a visible target — which is politically advantageous, especially in the lead-up to midterm elections.
“People are scrutinizing spending across the board,” Goldberg said. In that environment, policymakers are looking for ways to show they are “doing something” to address the affordability crisis.
This helps explain why actions are emerging on multiple levels at once.
In Congress, lawmakers have introduced legislation to block preferential pricing deals between companies, including delivery apps and restaurants, after allegations that Walmart and PepsiCo struck deals that would allow the retailer to undercut competitors.
In New York City, Mamdani has leaned on enforcement, announcing a nearly $1 million settlement with delivery app HungryPanda, which authorities overcharged restaurants through junk fees, Business Insider previously reported.
For regulators, delivery fees are an obvious entry point. But industry insiders say they’re just part of a much larger system.
Delivery platforms typically charge restaurants commissions of 15% to 30% of the order, on top of additional fees — such as “enhanced service” fees — to make sure the order is visible on the platform, Swanson said. The result is a widening gap between the big chains and the smaller operators.
“Uber Eats increased rates to small and medium-sized restaurants by 5% in March 2026 and kept custom-negotiated rates for larger partners largely intact,” she said.
At the heart of the issue, Swanson argues, is dependence, not just fees. Smaller operators rely on delivery apps to reach customers, especially as diners eat less, but are stuck paying higher fees to stay visible and compete.
That dynamic creates a fundamental imbalance. For larger chains, higher commissions may be manageable. Restaurants operating on thin margins often respond to platforms by raising menu prices, adding surcharges or both, she said.
Efforts to cap or regulate fees do not eliminate costs; They move them, Swanson said. Caps can also have unintended consequences for restaurants.
“A mom and pop Thai place pays 15% in a fee-capped environment but being buried in search results is no better than paying 25% and showing up on the first page,” she said.
One of the biggest open questions is whether greater transparency will actually change how markets operate.
Delivery charges already dealt with. They can add several dollars to an order, and “price-conscious consumers are gravitating toward pickup” to avoid them, Swanson said — but it’s all about how those charges are presented. A clearly labeled $4 delivery fee feels different than many smaller fees that add up to the same amount, he added.
“What consumers really want is to know what the food will cost before they start ordering, and right now they’re not getting that,” she said.
Still, Goldberg was cautious about how much disruption to expect.
“I’m not sure how much space it creates for new competitors,” he said.
Taken together, the FTC’s investigation, congressional scrutiny, and local enforcement actions suggest a broader shift toward examining pricing power by targeting “junk fees.”
But some say the current regulation talks may be missing a key piece.
“Fee caps address the contractual relationship,” Swanson said, “but leave ranking and visibility mechanics completely untouched,” meaning restaurants may face lower fees but worse placement, limiting the benefit.
For now, the FTC is gathering public input before deciding whether to pursue formal regulations. If it does, it could create the first nationwide standards for how delivery charges are disclosed.
But even if the fees are clear, they may not be cheap.
As the crackdown expands, the underlying question remains: Will consumers pay less — or just pay differently?
Read the original article on Business Insider
