Delivery Apps: Proposal to Regulate Commissions

In Costa Rica, a bill to give the Ministry of Economy, Industry and Commerce the power to determine the maximum commissions and amounts that may be charged by digital platforms such as UberEats, Glovo, Rappi and Hugo was presented.

Wednesday, August 12, 2020

This bill arose in a context of booming demand for fast food with home delivery, and a complicated relationship between restaurants and delivery applications.

See "Fast food: Growing interest in the region"

The initiative called "Law for the Regulation of Fees Charged by Digital Delivery Service Platforms", presented on August 10, 2020 by MP Paola Vega, aims to protect the commercial sector from abusive fees charged by digital delivery service platforms, according to the authors of the legislative project.

You may be interested in "Geomarketing and Decision Making"

In a statement from the Citizen Action Party (PAC), Vega explained that "the restrictions on public attention give the platforms a great advantage. But unfortunately, they have abused the situation and even charge commissions of up to 30% on each purchase and up to 25% for delivery. Many people who are struggling to get ahead with their business also have to deal with these totally abusive and unfair percentages."

The project proposes that the commissions charged by the digital platforms for services to businesses, may not be more than 15% on the sale. During this period, the Ministry of Economy, Industry and Commerce, Chamber of Commerce, Chamber of Restaurants should conduct periodic reviews of the fees to determine and the MEIC will publish the maximum fees periodically, explains the document published by the PAC.

Vega added that "... what we want is to give the commercial sector some breathing space to improve its cash flows and help in its economic recovery. Many restaurants and shops will not be able to survive without facing unfair clauses such as those established by a handful of companies participating in the digital delivery platform market. In this way, the delivery companies also present high commissions for the services they perform."

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More on this topic

Restaurants and Delivery Apps: A Difficult Relationship

July 2020

With the boom in demand for food delivery, Costa Rican restaurant owners claim that their companies have given up part of the profits to assume the costs of making alliances with delivery applications.

Since last March, when the first cases of covid-19 were reported in Costa Rica, consumers have been subjected to severe restrictions on mobility, which has led to transformations in the forms of marketing.

Restaurants: Less Profits in the App Era

November 2019

The growing tendency to order food from home through digital platforms is causing a decrease in business profits, as they must assume the cost of service delivery commissions and sometimes those of additional promotions offered by the applications.

Digital applications such as Uber Eats, Hugo App, Go Pato, Glovo and Rappi, which offer in Costa Rica the service of home delivery of food and other items, have gained much popularity among consumers, so restaurants have had to adapt their internal processes to this new trend.

Collaborative Economy: New Competitor in Costa Rica

October 2019

After investing $2 million, the company Rappi, dedicated to the service of food delivery, orders and cash transport, began operations in the country.

This type of service supply is increasing in the Costa Rican market, as Rappi will have to compete with Uber Esats, Glovo and Hugo.

Sharing Economy Grows in El Salvador

November 2018

Uber Eats food delivery application will be available in the country from November 23rd and will start operating with 150 affiliated restaurants.

Representatives of Uber Eats for Central America informed that in the first phase of operation, the application will cover food deliveries in some areas of the Metropolitan Area of San Salvador.

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