China first country to create regulations for on-demand mobility

Signal of change / China first country to create regulations for on-demand mobility

By Anna Simpson / 26 Oct 2016

China has set out a policy for nationwide regulations for on-demand mobility (ODM) services, such as American Uber and its Chinese counterpart Didi Chuxing, giving them legal status. This is a world first, the Vice Minister of Transport Liu Xiaoming claims: many countries either ban the services or allow them to operate in a grey, unregulated area. 

The regulations, provisional for now, mandate that:

  • ODM companies are responsible for the licensing of fleets and drivers
  • ODM companies must buy insurance for passengers and pay taxes
  • Cars can no longer offer rides after 600,000km or more than eight years of use
  • Drivers must have no criminal record relating to drug or alcohol misuse, driving or violence
  • ODM companies must not undercut market prices.

So what?

The policy has been welcomed by transport experts and the public, according to the report by China.org.cn. It is intended to protect both the customers, through safety regulations and mandatory insurance, and the market, through pricing regulation. It also protects ODM companies against a backlash.

On-demand services can play a role in cutting emissions, through greater efficiency, cutting dead mileage, and encouraging car-sharing, for instance. However, they can also increase demand for private transport.

The ability of governments to recognise and respond to informal economies is important for sustainable urban development, encouraging resourcefulness and increasing resilience.   

Sources

http://www.china.org.cn/business/2016-07/29/content_38981257.htm

What might the implications of this be? What related signals of change have you seen?

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