New bill passed in this state takes restaurant reservations off the resale market

The Restaurant Reservation Anti-Piracy Act awaits a signature from New York Governor Kathy Hochul to become law.

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June 8, 2024, 4:29 AM GMT+7 / Source: Today.com

By Randi Richardson

New York’s state legislature has passed a new bill that will require third-party reservation services to obtain permission from restaurants to book on their behalf.

The bill, dubbed the Restaurant Reservation Anti-Piracy Act, says that third party reservation services such as Resy and OpenTable cannot “advertise, promote, or sell reservations” on its platforms for a “food service establishment” without a written agreement with the establishments.

The legislation makes New York the “first state in the nation to pass legislation intending to combat the trend of predatory software flooding the online restaurant reservation marketplace,” according to a press release issued by the New York State Restaurant Association on June 6.

The bill was introduced in May by Senator Nathalia Fernandez, passed the State Assembly June 3 and passed the state Senate three days later. It now awaits a signature from Governor Kathy Hochul to become law.

Fernandez said in the press release that the bill will curb “the rampant exploitation of online restaurant reservations.”

“Between charging exorbitant rates for a reservation, to double-booking reservations, to phantom reservations leaving diners with less options and restaurants with empty tables—the onus is on us in the Legislature to take action,” she continued.

Making black market reservations in New York had become a side business, with practitioners snapping up blocks of meal times at the hottest restaurants with the intention of selling them back to people who want to dine there, NBC News reported. A student at Brown University made $100,000 over the course of 19 months from selling reservations, according to NBC News.

Melissa Fleischut, president and CEO of the New York State Restaurant Association, called the bill “a major victory” in the press release.

“Our members work hard each day to create a desirable dining experience,” she said. “Now, when diners do have the ability to dine out, they will no longer have to compete with predatory bots capturing reservations and reselling them at exorbitant prices.”

The CEOs of OpenTable and Resy, Debby Soo and Pablo Rivero, respectively, also applauded the legislation in the release.

“The passage of this bill is a meaningful one for restaurants and will help protect their bottom lines by reducing the ‘no shows’ caused by fraudulent reservations,” Soo said. “We are pleased to see New York take a strong stance to support its restaurants.”

“Resy joins many of its New York restaurant partners in applauding the New York State Legislature for passing the Restaurant Reservation Anti-Piracy Act,” Rivero said. “This important legislation is a significant step forward to protect restaurants and diners from reservation fraud.”