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The Illinois Restaurant Association has joined other associations, and the National Restaurant Association, in protesting a proposed rule that would prohibit added fees.
The idea behind the rule is to prohibit the kinds of fees that irritate consumers, such as concert ticket surcharges and hotel "resort fees." However, the rule would also block common restaurant fees, such as credit card surcharges, which many restaurants count on. The IRA asserts that prohibiting such fees would force restaurants to increase menu prices, thereby hiding the true source of the costs, which is the opposite of the rule's intention.
The IRA sent an email to membership discussing the situation, and asking restaurants to submit comments to the FTC about it. Here are some key points from the email:
The Federal Trade Commission’s (FTC) proposed rule could force restaurant operators of all sizes to rewrite compensation models, increase menu prices, and overhaul established business practices. The FTC admits it would cost restaurants at least $3.5 billion to comply with their plan.
The FTC would force restaurant operators to:
- Remove any separate fees or surcharges—including service fees and large group surcharges.
- Overhaul menus so that the listed price is the total price a customer must pay.
- Eliminate the use of surcharges for dynamic costs such as credit card processing or delivery fees.
It would also create a new wave of litigation and federal fines for noncompliance.
The Illinois Restaurant Association is working with the National Restaurant Association to resist this regulatory overreach, but the FTC needs to hear from operators like you today! Public comment will only be open for a short period of time. Voice your opinion NOW!
Click here to add your name opposing the FTC’s rules.
Click here to view a fact sheet.
Click here to register for the National Restaurant Association's upcoming webinar.
Thank you for helping restaurants fight this proposal. We will keep you updated with any developments.
Sam Toia
President & CEO
Illinois Restaurant Association
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