New York Governor Hochu recently signed the Restaurant Reservation Anti-Piracy Act, prohibiting third parties from arranging unauthorized restaurant reservations, thereby putting an end to the exploitative market. This is the first state in the country to enact such a law.
The restaurant industry in New York is well-developed, especially in some areas of Manhattan, where restaurants are often fully booked and diners sometimes need to queue outside the premises. With such a large market and advanced artificial intelligence, some individuals have found ways to exploit the system. Recently, a practice has emerged across New York where reservations are made for customers, and they are charged before entering the restaurant; those who refuse to pay are denied seating, leading to an increase in the phenomenon of “no-shows” in crowded restaurants.
Governor Hochu stated in a release, “We are putting an end to the exploitative black market of restaurant reservations, protecting consumers and businesses, and ensuring that everyone has the opportunity to have a seat at the table.”
The sponsor of the bill, State Senator Fernandez, mentioned that the legislation targets unauthorized intermediaries. “They cancel orders at the last minute and fail to show up, causing chaos for restaurants, leaving tables empty, and depriving hardworking staff of tips.”
State Assemblyman Bores, who proposed the bill, proudly highlighted the elimination of these “leech-like” exploitative business practices, contributing to lowering dining costs for New Yorkers.
Restaurant owners have welcomed this law. Melissa Fleischut, Chairwoman and CEO of the New York State Restaurant Association (NYSRA), stated that the current use of artificial intelligence exploits the labor of restaurant owners and workers by hoarding reservations without the restaurants’ knowledge and selling them for profit.
“Restaurant orders, staff scheduling, and many other aspects of the restaurant rely on accurately predicting how many customers will come on a particular night,” she said. These “bots” have led to a continuous rise in the rate of “no-shows” at many establishments, causing serious disruptions to operations. “We appreciate the governor for signing this important legislation.”