A Charlottetown entrepreneur has set up a fry shack next to the cruise ship dock, but has run afoul of zoning regulations.

Karen Prins set up the shack a week ago. Prins said she's in the business of making people happy.

"I do believe that when people leave the chip shack they have smiles in their hearts, they've got laughter on their brain," she said.

The property owner has given permission for the business, and cruise ship passengers were enjoying it Tuesday.

"I thought that was the most exciting thing when we got off," said Brenda Olhausen.

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Municipal councillor Rob Lantz.

"It was the first thing we saw. Look, it's hand-cut fries. We had to try it."

But city officials say the shack is illegal, because city planners zoned the land for parking. Prins has applied for a permit to continue operating.

"I understand the planning staff have asked her to cease operating from this location until the application has been processed and council makes a decision," said Coun. Rob Lantz, chair of the city's planning committee.

If she doesn't stop the city could take her to court. Lantz said he hopes it doesn't come to that.

"It adds vitality to the street. It's great to see here. The cruise ship is in town. They seem to be busy," said Lantz.

"It's just that we need to wrap some certainty around this whole process so that everyone's playing on a level playing field."

Prins said she will continue to operate.

"I use local products so I'm putting back into the community," she said.

"I want to touch as many hearts as possible and have them have an amazing experience."

City council's next meeting is in July, and the application will be considered then.