Federal rule must set a floor, not a ceiling and must complement California’s strong consumer protection laws

OAKLAND — California Attorney General Rob Bonta yesterday sent a letter to the Federal Trade Commission (FTC) regarding its rulemaking proceedings to address unfair and deceptive acts or practices related to online food delivery fees. The letter commends the FTC for its attention to this matter and urges that any final rule does not preempt state law, in order to complement California’s existing laws that protect consumers and honest businesses from this deceptive conduct across industries, including food delivery. In 2023, California was the first state to pass an honest pricing law, SB 478, which works to empower consumers by arming them with accurate information upfront, so that they can compare prices between merchants.

“Consumers always, but especially amid a crisis of affordability, deserve to do business with companies that act transparently and with integrity. In 2023, California led the country in banning hidden fees and this week, I applaud the Federal Trade Commission’s work to ensure all Americans are protected from unfair or deceptive online food delivery fees,” said Attorney General Bonta. “At the same time, any federal rule must work with and complement the robust protections Californians already enjoy. I appreciate the Federal Trade Commission’s continued interest and effort to protect consumers and honest businesses throughout the nation and to recognize and preserve the vital role of state consumer-protection laws.”

California has taken action to protect consumers from deceptive price advertising across industries, including food delivery. In California, when food delivery platforms advertise a price for a delivery service, it must be the full, all-in price of the delivery service. Deceptive price advertising violates California’s False Advertising Law and Unfair Competition Law. To further this work, in 2023, the California Department of Justice and the California Low-Income Consumer Coalition co-sponsored California’s Honest Pricing Law (SB 478), which makes clear that the advertised price must include all mandatory fees other than tax and shipping. This law went into effect on July 1, 2024, and, with limited exceptions, governs all companies doing business in California, including food delivery platforms. SB 478 does not change what price a business can charge or what may be included in that cost, it simply requires that the price listed include all mandatory charges consumers will pay.