The Hong Kong government on Tuesday proposed issuing 10,000 new vehicle permits for drivers working with online ride-hailing services like Uber. This figure is less than half of what industry representatives had hoped for.
Background on Ride-Hailing in Hong Kong
Hong Kong currently has approximately 18,000 licensed taxis and caps private service car-hire permits at 1,500. While these drivers can be summoned through ride-hailing apps, many additional drivers operating through such platforms technically operate outside the law and have faced arrest in the past, despite being prevalent in the city.
Regulatory Framework Unveiled
The government unveiled details of a regulatory framework last summer to bring the industry under formal regulation, following years of pressure from taxi companies. The Smart Transportation Alliance, which includes ride-hailing firms and other transportation companies, had proposed in May that 20,500 new car permits be allowed in an initial phase. However, in a document submitted Tuesday to the legislature, Hong Kong's Transport and Logistics Bureau stated that a cap of 10,000 would be prudent and appropriate, balancing passenger needs and public road resources. The bureau said it would review the ceiling later to determine if adjustments are needed.
Licensing Requirements
Lawmakers last year passed a bill requiring licenses and permits for online ride-hailing platforms, their vehicles, and drivers. When granting a license, Hong Kong’s transport commissioner can consider a firm’s experience, financial capacity, and intended investments in the region. Licensed companies must maintain “proper and efficient” services. Drivers must be at least 21 years old, hold a driver’s license for at least one year, have no serious traffic convictions over the past five years, and pass a test.
Implementation Timeline
Under Tuesday's proposals, most new ride-hailing regulations would take effect in August, with the remainder in place by August 2027. By then, all platforms must be licensed and ensure that all vehicles and drivers linked to them have permits. Companies will need to use technology, such as face-recognition software, to verify that drivers are the actual owners of the vehicles they use.
Enforcement and Public Reaction
Police have previously arrested some Uber drivers suspected of driving without a permit, and in 2018, more than two dozen drivers were fined. Some taxi drivers have long resisted online platforms like Uber, viewing them as rivals that threaten their businesses. However, Uber, which started operating in Hong Kong in 2014, remains popular among residents frustrated with what they describe as poor taxi services. Uber has also begun including licensed taxi drivers on its platform in recent years.
Uber's Response
In a previous document submitted to the legislature, Uber's Hong Kong team stated it has over 30,000 active drivers in the city over the past year. The company argued that even if 15,000 permits are issued and enforced, waiting times for bookings during certain periods could double compared to current levels, and fares might rise by as much as 70%. In a statement Tuesday, Uber said the legislative proposal is an important step toward establishing clear regulations but noted that the initial quota is “significantly lower” than needed to meet rider demand. The company added that more than 20,000 people would lose an opportunity to earn under the proposals. “This legislation is just a start. We hope to continue working closely with the government on an efficient allocation framework and a practical review mechanism that allows the system to evolve over time,” Uber said.
