Food delivery commission cuts too deep, MCA man warns Putrajaya of boycott

 

An MCA man has mulled mobilising a boycott campaign against food delivery platforms which charged excessive commission if the government fails to take action in one month's time.

At a virtual press conference today, "Campaign to protect the rights of e-hailing drivers" spokesperson, Ng Kian Nam, urged the Domestic Trade and Consumer Affairs Ministry to cap the commission fees at 15 percent.

Most of the food delivery platforms are charging up to 35 percent as commission.

Ng also urged the ministry to decide if the existing food delivery platforms have violated the Consumer Protection Act 1999.

Both demands, he said, were sent to Domestic Trade and Consumer Affairs Minister Alexander Nanta Linggi via an email today.

The email was sent under Ng's capacity as the MCA civil society movement bureau chief.

For the record, MCA is part of the Perikatan Nasional (PN) government despite not being an official member of the PN political coalition.

"If we don't receive any positive response from the ministry within a reasonable time, we will consider a series of awareness campaigns on the ground, including a boycott campaign involving consumers as well as food and beverage operators," Ng said.

He said consumers and eatery operators may boycott food delivery platforms that impose excessive commission fees.

"Sections 4 and 5 of the Consumer Protection Act give the minister absolute power to set the cap price," he said.

When asked if the boycott will be mobilised by MCA, he said, "Who is going to organise the boycott is not important."

"The boycott can be organised under our civil society movement bureau and related associations," he said.

"The minister is well aware of the issue (excessive commission fees) faced by food and beverage operators since more than one year ago," he said.

Ng's proposal that the fees should be capped at a lower level is based on the US model, where food delivery platforms there charge 15 percent as commission fees on the various services offered.

It was reported that the 15 percent cap would prohibit third-party food delivery companies from charging a delivery fee of more than 10 percent of the purchase price of an online order from restaurants in the US.

Ng said that in Malaysia, some delivery platforms charge double, or even triple, the price to consumers.

"This can be seen in some food menus (uploaded on the apps). A family of five ordering wantan mee for breakfast, nasi kandar for lunch, and vegetarian rice for dinner may have to fork out RM340 per day and this will be translated to RM10,200 expenses per month.

"This clearly shows that only the top 20 (percent of income earners) group can afford such services in Malaysia," he said.

"These charges include the advertising costs and commission fees imposed on the restaurants which are not reflected in the invoice issued by the food delivery platform to consumers.

"The delivery fees may also not be in line with the actual amount paid to the riders of the food delivery services," he said.

He added that new contracts which were issued recently by a food delivery platform, made it so that the company has absolute discretion to set the commission rates for their drivers.

He pointed out that the commission rates for riders are not transparent, unlike the commission rates for eatery operators. - Mkini