Hong Kong authorities have proposed adopting stiffer penalties for illegal ride-hailing services and relying on licensing to regulate platforms such as Uber as a step towards easing a long-running feud between the city’s taxi industry and their online rivals.
The Transport and Logistics Bureau said in a paper published on Monday that tougher penalties would have a deterrent effect, while it would also strengthen taxi services through the launch of premium fleets.
While the document cited regulatory regimes in Singapore, Shenzhen and London, among others, the bureau stressed it was not committed to a particular framework and would develop its own by 2025.
“We will also continue to explore strategic directions for improving personalised point-to-point transport services such as ride-hailing services, taxis and licenced vehicles to meet citizens’ demands,” it said.
It is illegal for drivers of private vehicles in Hong Kong to accept paid customers without a hire-car permit. Ride-hailing platforms such as Uber are not regulated.
Uber welcomed government plans to regulate ride-hailing platforms but called on authorities to also create a “workable licensing regime”.
“Any move to cap the number of ridesharing licences in the city would deal a blow to the many drivers who rely on the platform for flexible earnings opportunities,” the company said.
“It would also risk making point-to-point transportation more expensive and less reliable for Hong Kong people.”
Uber also said it was ready to work with the government and other stakeholders to help shape further regulatory details.
In Monday’s government paper, the bureau said the Transport Department would conduct a study on commuter needs and changes later this year to help inform any proposed regulatory regime. The study was expected to be completed within a year, it added.
“We will assess the types and number of vehicles that can provide services through the platforms under the future regulatory proposals, as well as the relevant licensing requirements for the platforms and drivers,” the bureau wrote.
The bureau proposed suspending the licences and registration of vehicles involved in illegal ride-hailing services, as well as impounding the vehicles.
The move would cover vehicles involved in cases where authorities had failed to identify and prosecute the drivers, plugging an existing loophole.
It also called for a minimum driving licence suspension period for those convicted of offering such services, with 12 months one of the options.
If the proposals are approved, it will mark the second time authorities have strengthened penalties for illegal ride-hailing services since 2023.
“We will work with Hong Kong police and the Department of Justice to study the details of the new rules,” it said.
The bureau stressed that proposed regulations for ride-hailing services were not intended to force passengers to switch transport options, noting such a move could contribute to existing traffic levels.
The government needed to control the number of vehicles providing point-to-point transport services, as well as consider the service quality of such options, it added.
Transport authorities said they would assess the impact of next year’s launch of the premium taxi fleets and would also need to wait for the verdict from a legal challenge initiated by some ride-hailing drivers.
“We suggest regulating online ride-hailing platforms in Hong Kong by means of using licensing and listing out relevant licensing conditions in the legislation,” the bureau wrote.
“With the continuous improvement of taxi service quality, residents can be rest assured that they can use various point-to-point transport services.”
The bureau said it hoped to achieve a “win-win” situation for the public and the transport industry.
It added that transport officials were studying the feasibility of requiring taxis to install surveillance cameras and would consult the industry by the end of the year, before raising the matter with lawmakers.
Lawmakers have appealed to the government to relax hire-car permit rules and increase the licence quota if the proposed regulations require drivers on ride-hailing platforms such as Uber to have them.
04:41
Where do drivers stand in Hong Kong’s Uber vs taxi battle?
Where do drivers stand in Hong Kong’s Uber vs taxi battle?
Authorities said they were not considering an increase in the number of permits at present, citing a need to control the number of vehicles on the road.
But legislator Gary Zhang Xinyu said earlier on Monday that the government had to increase the number of private hire-car permits available if it went ahead with the requirements.
He highlighted the size of the market for online ride-hailing and the huge demand for the service.
The government at present has a quota of 1,500 hire-car permits.
Lawmaker Ben Chan Han-pan welcomed the government’s plans to respond to changing commuting trends and study the future development of ride-hailing platforms.
He also brushed aside concerns that any crackdowns on ride-hailing platforms such as Uber would damage the city’s competitiveness.
He said that “the taxi service is expected to improve in the near future” as premium cab fleets would launch by the middle of next year.
Chan also said regulations for ride-hailing platforms should be implemented in stages, adding authorities should first assess the performance of premium taxi fleets and consider the impact on the livelihoods of more than 30,000 cabbies.
Uber drivers told the Post that the rules were “unfair” without raising the cap on the number of permits, highlighting the difficulty of obtaining one and saying that some could have to stop working if the government pushed ahead with any proposed regulations.
There are currently five types of hire-car permits, which cover services for hotels, tours, private limousines, private cross-border limousines and regular private operators.
Government figures show only 1,115 private service hire-car permits were issued by 2021.
Uber statistics show more than 216,000 drivers were registered on Uber and its Uber Taxi platform by 2021.
The Legislative Council is scheduled to discuss the regulatory framework on Friday in a panel meeting.
