Parliament: Bike-sharing firms which lose licence cannot use security deposits to pay debts
Sign up now: Get ST's newsletters delivered to your inbox
The authorities have suspended the licence of Chinese bike-sharing company ofo, which reportedly owes suppliers more than $700,000 and which has let go of hundreds of workers.
ST PHOTO: LIM YAOHUI
SINGAPORE - Security deposits and licensing fees the Government collect from bike-sharing companies cannot be used to pay their debts to users and employees after their licences are revoked, said Senior Minister of State for Transport Lam Pin Min in Parliament on Monday (Feb 18).
The fees are to cover regulatory costs so that they are not passed on to taxpayers while the deposits are for specific situations like settling unpaid fines, he added.
The authorities, however, are "closely monitoring the situation" to see if more can be done to protect the employees and users of such firms, a suggestion made by Nominated MP Walter Theseira.
Associate Professor Theseira had asked whether the Government considers - as part of the licensing process - whether a bike-sharing operator can meet its financial obligations to staff, vendors and users.
He had also asked whether any monies from fees paid to the Government are available for claims by these parties and if so, how claims are determined.
Last week, the authorities suspended the licence of Chinese bike-sharing company ofo, which reportedly owes suppliers more than $700,000 and which has let go of hundreds of workers.
Dr Lam said that vendors, companies, employees and users who are owed money by operators who lost their licences can seek redress through the civil courts.
"The employees can also approach the Tripartite Alliance for Dispute Management for help to resolve their salary disputes," he added.
Dr Lam also said that situations that the security deposit can be used for are listed in the Parking Places Act and these include serving as surety for an operator's compliance with licence conditions, recovering the costs of removing and disposing of bicycles should the operator fail to do so after its licence is cancelled.
He also said that the Land Transport Authority will not make a claim on the deposit should these circumstances not arise.
Operator ofo had its licence suspected last week by the LTA for failing to meet regulations such as introducing a QR code-based parking system that would require its bicycles to be parked only in specified areas.
Its licence may be cancelled should it fail to show "satisfactory progress" in meeting these requirements, said the LTA.
