A Win! Reservation Scalping Ban Signed into Law

The NYC Hospitality Alliance is happy to share great news. Today, Governor Hochul signed the bill into law that passed the state legislature earlier this year prohibiting the sale of a restaurant reservation without written permission by said restaurant. This was a law we advocated for.

While restaurant reservation scalping has been going on for many years, the problem has gotten worse in recent years, and it’s received media attention recently, especially with the launch of websites that facilitate the unauthorized sale of reservations, which turned it into a lucrative hustle for some people. 

"Restaurant reservation scalping deprives businesses and workers of needed money when the seats don’t sell and the table goes empty, and it creates a barrier between them and their customers when unknown guests show up. Reservations are not a hustle for unauthorized third parties to sell for profit. Big thanks to Assemblymember Alex Bores and Senator Nathalia Fernandez for passing their legislation, and thank you Governor Hochul for signing it into law to help stop reservation scalping." Andrew Rigie, Executive Director, NYC Hospitality Alliance

Thanks to the other advocates, partners and supporters of this ban on reservation scalping.

A background on restaurant reservation scalping: 

The unauthorized online restaurant reservation market works like this: Third-party platforms directly secure or encourage scalpers to secure reservations at popular restaurants without the restaurants’ permission, and then they facilitate the sale of those reservations for a hefty fee on their websites and apps. These reservation scalpers often use bots to quickly secure the reservations online and take them off the market, so the average human customer can’t get access to that reservation without paying an unauthorized third party. The following are just some reasons why this is BAD for restaurants, workers, and consumers:

• Why it’s bad for restaurants? When people and bots secure restaurant reservations and cannot sell them, it results in a “no show” customer, meaning the table goes empty and the restaurant loses out on that important revenue. Restaurants are also in the hospitality business and want to establish ongoing relationships with their customers (their likes, dislikes, food allergies, etc.), so when someone buys a reservation that is booked under someone else’s name and contact information it creates a communication barrier between them and their customer, and it may create other inconveniences such as the inability to contact the customer who purchased the reservation should they mistakenly leave their credit card or another personal item at the restaurant.

• Why it’s bad for workers? When people and bots secure restaurant reservations and cannot sell them, it results in a “no show” customer, meaning the table goes empty and workers lose out on the important tip income they rely on.

• Why it’s bad for consumers? When reservations are secured by scalpers who sell them, it removes table inventory from the market, making it harder for consumers to properly get a reservation at restaurants, and it forces them to pay a hefty fee to an unaffiliated third party for a reservation that the restaurant offers for free.