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Illustration: Aïda Amer/Axios

San Francisco on Friday announced a temporary 15% cap on fees delivery companies can charge restaurants during the coronavirus crisis.

Why it matters: Food delivery has skyrocketed as residents remain confined in their homes except for essential trips. The service has become the primary source of revenue for restaurants as they can no longer serve on-site patrons.

  • Typically, third-party delivery companies charge fees to the customer and also take a commission from the restaurants.

Between the lines: While some companies have slashed fees for customers during the COVID-19 outbreak to incentivize them to order more, restaurants have complained that high fees eat into their already-reduced revenues.

Yes, but: Critics of such fee caps argue this leads to unintended consequences like lower incentives for the delivery companies to work with specific restaurants or in certain areas, change how they pay drivers, or shift fees to customers to make up for lost money (and potentially decreasing demand for delivery).

  • "In the face of this new policy shift, we are going to give restaurants the ability to pass some of these optional costs onto consumers," a GrubHub spokesperson said of the additional fees it charges restaurants for services beyond delivery, which add up to more than 15%.
  • Uber Eats said that "regulating the commissions that fund our marketplace—particularly during these unprecedented times—would force us to radically alter the way we do business, set a far-reaching precedent in a highly competitive market, and could ultimately hurt those that we’re trying to help the most: customers, small businesses and delivery people."
  • Pointing to an announcement the day before of cutting its restaurant fees by half, DoorDash added: "We are reviewing the Mayor’s order, including the legal basis for such an extraordinary unilateral action, and will respond accordingly."

Editor's note: The story has been updated with comments from delivery companies.

Go deeper

Updated 3 hours ago - World

Pentagon: 8,500 troops on high alert for possible deployment to eastern Europe

Photo: Anna Moneymaker/Getty Images

Defense Secretary Lloyd Austin has placed 8,500 U.S. troops on "heightened preparedness to deploy" to eastern Europe in case NATO activates its rapid-response force over tensions with Russia, the Pentagon announced Monday.

Why it matters: No decisions have been made to actually deploy U.S. forces, but the heightened alert level will allow the military to rapidly shore up NATO's eastern flank in the event that Russia invades Ukraine. The Pentagon warned that Russia has shown "no signs of de-escalating," and continues to amass troops on Ukraine's borders.

Updated 3 hours ago - Politics & Policy

Biden calls Fox News reporter a "stupid son of a b---h" on hot mic

President Biden blasted Fox News' Peter Doocy on Monday after the reporter asked if the nation's soaring inflation is a political liability, saying, "what a stupid son of a b----h."

The latest: The president called Doocy Monday evening, the reporter told Fox's Sean Hannity. "He cleared the air and I appreciated it. We had a nice call," Doocy said when asked whether the president apologized, adding: "I don't need anyone to apologize to me."

Updated 4 hours ago - Politics & Policy

Omicron dashboard

Illustration: Shoshana Gordon/Axios

  1. Health: Fauci: "Confident" Omicron cases will peak in February.
  2. Vaccines: The shifting definition of fully vaccinated.
  3. Politics: New York Supreme Court strikes down Gov. Hochul's mask mandate for public areas — Sarah Palin tests positive for COVID, delaying defamation trial — Virginia school boards sue Gov. Youngkin for lifting mask mandate.
  4. World: U.K. to lift travel testing requirement for fully vaccinated — Beijing Olympic Committee lowers testing threshold ahead of Games.
  5. Variant tracker

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