What does the Delivery Protection Act require of Amazon and its DSPs?

The original bill requires what it calls a last mile facility operator to obtain city licensing and prohibits third-party subcontracting. In practice, this would force Amazon to directly employ currently independent DSP operators or consolidate delivery operations. The bill also gives the city commissioner power to suspend or revoke licenses for non-compliance with applicable laws and regulations.

How many DSPs operate in New York City under Amazon's current model?

Approximately 100 individually-owned DSPs operate in NYC under Amazon's contract structure. According to the article, more than a quarter of these DSPs are led by people of color, and many are operated by veterans and other entrepreneurs distributed across all five boroughs.

Will the bill pass in its current form?

No. Multiple sources indicate the bill will pass but in substantially modified form. The Manhattan Chamber of Commerce president stated that City Council members are negotiating internally about the final version. Council Speaker Julie Menin's concerns about job losses and price increases suggest the final legislation will include compromises from both supporters and opponents.

What are the national implications of this legislation?

The Delivery Protection Act model is already being proposed in Chicago and has drawn national media coverage. If passed in NYC, it could establish a regulatory precedent that encourages similar legislation in other cities or states, potentially reshaping how e-commerce companies structure last-mile delivery operations nationwide.

Who is opposing the bill and what are their main arguments?

Opponents include Amazon, DSP operators organized under New York Delivers, and all five borough Chambers of Commerce. Their core argument is that DSPs are legitimate small businesses employing thousands, and that the bill's enforcement mechanism could leave workers unemployed during licensing disputes. Opponents also argue Amazon might relocate warehouse activities to nearby counties like Nassau County or Westchester to circumvent the law.

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The signal

The New York City Council is poised to pass the Delivery Protection Act before the end of 2026, but not in its current form. The legislation, originally introduced in February and backed by Mayor Zohran Mamdani, targets Amazon's Delivery Service Provider (DSP) model by requiring last-mile facility operators to be licensed by the city and banning third-party subcontracting. If passed as written, the law would effectively force Amazon to absorb approximately 100 NYC-based DSPs and convert contracted workers to direct employees.

However, growing consensus among City Council members indicates the final bill will include substantial modifications from the original proposal. The Manhattan Chamber of Commerce, along with all five borough-based Chambers of Commerce, argue that the bill threatens locally-owned small businesses, many led by entrepreneurs of color and veterans, and could create legal and enforcement complications. City Council Speaker Julie Menin's position remains pivotal: while concerned about potential job losses and price increases, she has indicated general support for the legislation, suggesting it will likely reach a floor vote.

The outcome could set a national precedent, with similar regulatory models already proposed in Chicago and drawing national attention from labor advocates and policy experts.

Companies affected by this story:

Dematic

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Ford Motor Company

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What This Means for Your Supply Chain

Simulation Suggestion

this month

What if the Delivery Protection Act passes and forces Amazon to internalize 100 NYC DSPs?

Simulate the operational and cost impact of Amazon absorbing approximately 100 independent DSP operations in NYC, converting contracted delivery networks to direct employment model. Assume 25% of DSP operations relocate to Nassau County and Westchester County to avoid regulations. Model downstream effects on delivery capacity, service levels, and unit economics for last-mile delivery in the five NYC boroughs.

Run this scenario

Simulation Suggestion

this month

What if modified legislation requires all DSPs to become W2 employees at higher labor cost?

Simulate the financial impact of revised Delivery Protection Act requiring DSP operators to convert independent contractors to W2 employees with full benefits obligations. Model changes to per-package delivery costs, DSP profitability margins, and overall delivery economics in NYC market. Assess whether Amazon absorbs cost increases or passes them to customers.

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Simulation Suggestion

strategic

What if Amazon shifts delivery pickup points to Nassau and Westchester counties?

Model the impact of Amazon relocating warehouse-based distribution and package pickup operations from Queens and the Bronx to Nassau County and Westchester County respectively, keeping DSP contracts outside NYC jurisdiction. Assess changes to delivery lead times, transportation costs, capacity utilization, and service level performance for NYC customers.

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