Debate on ministries' budgets

Uber and Grab could be subject to licensing

Second Minister for Transport Ng Chee Meng said the current basic regulatory regime has limitations and licenses only the drivers of these ride-hailing apps and their vehicles.
Second Minister for Transport Ng Chee Meng said the current basic regulatory regime has limitations and licenses only the drivers of these ride-hailing apps and their vehicles.ST PHOTO: KUA CHEE SIONG

Private-hire car services Uber and Grab could be regulated in the future, and even subject to licensing, as the Government undertakes a review of the point-to-point transportation sector.

Due to the growth of the industry, it is imperative that the Government has sufficient regulatory oversight of ride-hailing apps to protect the interests of commuters and drivers, Second Minister for Transport Ng Chee Meng said yesterday.

Mr Ng said in Parliament that the current basic regulatory regime has limitations and licenses only the drivers of these ride-hailing apps and their vehicles.

The Government is now studying how to license ride-hailing services, which will give it a "broader range of regulatory levers" to ensure the industry grows in a manner which meets the needs of commuters, drivers and Singapore's broader transport landscape, Mr Ng added.

While the Land Transport Authority (LTA) can issue suspen-sion orders to stop drivers from operating for ride-hailing services, this is a "very blunt tool", Mr Ng said during a debate on his ministry's budget.

The minister noted that the ride-hailing services should "bear greater responsibility in ensuring the safety of commuters" beyond the existing requirements.

Mr Ng was responding to Mr Ang Hin Kee (Ang Mo Kio GRC), who raised concerns about the growing market dominance of Uber and Grab, which have also formed alliances with taxi companies.

In December, taxi giant ComfortDelGro announced its intention to acquire a 51 per cent stake in Uber's car rental subsidiary, Lion City Holdings. The Competition Commission of Singapore is currently reviewing the deal.

Then in January, Uber and Comfort pooled their private-hire cars and taxis under a common booking service.

Uber's rival, Grab, had partnered with the other five taxi firms to do the same in March last year.

Recently, there were rumours of Grab buying out Uber's business in South-east Asia, although this has been dismissed by Uber.

Mr Ang said should one operator become dominant, commuters may have to bear higher fares and lower service standards, and drivers will also have to put up with the conditions set by the company.

In reply, Mr Ng said the Government's review will look into ensuring that the point-to-point transport market remains "open and contestable", and that commuters and drivers continue to have options.

The review of the private-hire car and taxi sector is targeted to be completed this year.

A Grab spokesman said that it will work closely with the LTA to ensure the ride-hailing industry caters to commuters' needs.

Uber Singapore's general manager Warren Tseng said the company looks forward to working with the Government to continue improving the industry "in ways that encourage growth and innovation while maintaining safety and reliability".

Adrian Lim

A version of this article appeared in the print edition of The Straits Times on March 08, 2018, with the headline 'Uber and Grab could be subject to licensing'. Print Edition | Subscribe