National Restaurant Association Sees Victory on Junk Fees Rule

Washington D.C. – In a major victory for the restaurant industry, the Federal Trade Commission (FTC) today has excluded restaurant fees from its so-called “junk fees” ban. Restaurant service fees, delivery fees, credit card surcharges, and other widely accepted restaurant-related fees will not be included in the final rule – which would have cost independent restaurant operators approximately 10 percent of their total income in compliance if it had passed as written.

“The FTC heard us loud and clear. Today’s successful outcome is a direct result of the concerted efforts of thousands of restaurant operators who voiced their concerns to the FTC and lawmakers on Capitol Hill,” said Michelle Korsmo, President & CEO of the National Restaurant Association. “The restaurant industry has faced economic and operational turmoil since the pandemic. The sweeping rule would have cost operators – who are already struggling with rising costs and labor challenges - upwards of $3.5 billion.”

In 2023, the FTC proposed a comprehensive ban on several different fees that it deemed unnecessary. Many of the fees that would have been caught up in the vast regulation included widely accepted restaurant charges, including delivery and large-party service fees.

In their joint public comments, the Association and its Restaurant Law Center pointed out that FTC lacked the legal authority to establish and implement the proposed regulations on restaurants. Because of the outpouring of public comments from 4,600 restaurant operators and direct advocacy on Capitol Hill at the 2024 Public Affairs Conference, the final rule does not include these restaurant fees.

“We are extremely pleased that the FTC recognizes the role restaurants play in our economy and our communities and chose to empower operators to make important business decisions without additional financial burdens,” said Korsmo.