Third-Party Taxi Booking Service Providers Bill

Mdm Speaker, first, I declare my interest as Chairman of the Singapore Taxi Academy. Since the third party taxi booking apps entered the Singapore market two years ago, there has been widespread use of third-party transport booking applications among a large number of commuters and individual self-employed drivers.

There have been an equally fast-growing number of private car chauffeured service operators using global positioning system (GPS) meter fare installed in a smartphone or tablet functioning exactly like the taxi-meter installed in a taxi.

As we know, the third-party taxi booking service operators that this Bill is trying to regulate are platform service operators. These platforms are run by data scientists, software engineers, operations and marketing specialists. As new technologies mature, it enables these platforms operators to apply their platform services to various modes of land transport: van or goods vehicles, passenger cars or taxis or private cars for hire and private buses for hire. As such, it may disrupt the existing regulations for all the modes of land transport. It may also change the traditional business operating models of these land transport modes.

In the case of taxis, the impact on taxi regulations is significant. We must not only look at the disruption on current taxi operations, but also look beyond taxis to other closely-related modes of transport, such as private cars for hire.

In this aspect, may I ask the Minister three questions?

First, how would commuter interest and consumer protection be safeguarded under the basic regulation approach of this Bill in view of what have transpired in other countries where the third-party taxi service booking service has developed into a social and political issue?

Second, would the requirements set for commuter safety and consumer protection be of the same level to all service providers, including taxi companies and car rental companies offering third-party taxi booking service, and also companies offering third-party taxi booking service only?

Third, how would LTA create greater awareness among all stakeholders – commuters, taxi drivers, hirers of rental cars and service providers – of consumer rights and the duties and responsibilities of service providers?

On the Bill, I also have three clarifications.

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First, will the Bill also cover private hire cars providing their services through third party booking service providers? These private hire cars are functioning like taxis except that they are not allowed to do street pick-up.

Second, will the Minister consider requiring drivers of the private hire cars to be screened, trained and tested for their competency before they could provide these services through the third-party booking service providers? This will ensure the interest of commuters using their services is safeguarded.

Third, in view of the introduction of this Bill, will LTA look into other aspects of the taxi regulations from: (a) Quality of Service (QoS) of taxi operator licence (TOL), in particular, the taxi call booking regulations; (b) defined statutory use of each category of vehicles; for example, how to prevent the revival of pirate taxis; and (c) data collection, application and enforcement. Mdm Speaker, I support the Bill.

Mdm Speaker, this Bill introduces a framework to regulate third-party taxi booking service providers, which include taxi booking mobile apps.

In recent years, the near-ubiquity of smartphones in Singapore has facilitated the entry of several taxi booking mobile apps like Uber, GrabTaxi and Easy Taxi. Most of these apps allow passengers to book rides with any taxi driver, even independent limousine drivers, unlike the booking services run by taxi operators which are limited to a smaller pool of drivers. This can provide better matching of passenger demand with taxi supply.

Some of these apps allow passengers to track the cab driver's location, contact the driver directly, rate their drivers and even share a cab with others who are travelling on the same route. This can help reduce transaction costs while encouraging taxi drivers to maintain high levels of service.

They are a win-win for both passengers and taxi drivers. Passengers enjoy greater convenience booking cabs and drivers have easier access to a wider pool of passengers. I understand some enterprising Singaporeans have started their own limousine companies and receive their bookings through these apps. A larger supply of drivers could help address the perennial problem of not enough taxis being available during peak hours or when there is a heavy downpour.

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With these "disruptive" technologies, the dominant taxi operators have to up their game or risk losing drivers to rivals. Their drivers could decide to switch to other operators who charge cheaper taxi rentals, while still receiving enough bookings via mobile apps. This could put downward pressure on rentals charged by taxi operators, which will benefit cab drivers.

Third-party taxi booking services could encourage greater competition, innovation and service quality and improve customer satisfaction. In regulating third-party taxi booking service providers, the Government should focus more on maximising benefits to consumers and taxi drivers and less on protecting a particular business model or existing taxi operators.

I would like to seek clarification from the Minister on clause 10(b), in which the regulator, in deciding whether to register an applicant, "must have regard" to the demand for third-party taxi booking services in Singapore. Does this mean that if supply of these booking services exceeds demand, as assessed by LTA, the regulator may decide not to issue a taxi booking service licence?

Can the Minister explain why LTA needs to base its licensing decision on demand for third-party taxi booking services? Is it not the responsibility of potential entrants to assess the viability of their own business models? If the service being provided by the new entrant is more attractive, this will give consumers more choice and consumers will naturally gravitate towards them, with weaker players fading out. I do not think the Government needs to make this decision for consumers.

Overall, I am glad to see that this Bill does not go the way of several other cities that have implemented outright bans on drivers accepting bookings via certain ride-sharing apps. It is not a free-for-all, where any private car driver can accept bookings via these apps. At the same time, the regulations require basic consumer protections to be in place, like requiring drivers to be properly insured, conducting background and health checks on drivers and prohibiting overcharging of passengers. Madam, I support the Bill.

Mdm Speaker, this Bill seeks to control and provide a regulatory framework for technological companies that operate third-party taxi booking app services for journeys within or partly within Singapore, in anticipation of the impact on the growing transport system in Singapore and ensure the safety of passengers who use third-party taxi booking services.

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Third-party taxi booking services have increasingly become a popular choice for commuters these days as they offer an alternative taxi booking service which allows commuters to book taxis from the different companies and facilitates a higher probability of booking a taxi.

The Bill is a good initiative by the Ministry of Transport (MOT) to safeguard commuters' safety and interest using third-party taxi booking services for transportation needs. A case of allegation of rape in Mumbai, India, and several other overcharging cases in Singapore were some of the issues brought about by the use of third-party taxi booking services.

This Bill also ensures third-party taxi booking services manage their pool of registered drivers well to provide a safe experience for passengers who choose to use their taxi booking services to provide basic customer support which includes feedback, lost and found services, and to deter overcharging of passengers.

After this Bill is passed in Parliament, third-party taxi booking apps will soon have to follow a set of regulations, as outlined by LTA.

Mdm Speaker, I support the Bill. However, the Bill has raised some issues which may be of concern. To me, this Bill deviates from the idea of the concept of a free market, where the supply of services by companies is set by market demand.

Under the proposed Bill, LTA is to issue licences to service providers and to impose penalties upon the licence based on the term, "a taxi booking service that is safe, reliable and efficient."

I bring up the point about Singapore being a free market because what LTA should be concerned about is the safety of passengers who use the taxi booking apps. It should not be concerned with whether or not the company is able to financially sustain itself through its operations or whether taxi booking services are "reliable and efficient".

Whether or not the services provided by the third-party taxi services are reliable and efficient should be left to users, such as the taxi-drivers and passengers, to decide. If the taxi-booking apps fail to be reliable and efficient, the users would choose not to use them and the company eventually will back out of the market.

Even so, the condition for safety needs to be clearly set out in the Bill of what LTA determines as being "safe"; it seems to be giving LTA an arbitrary right to determine what is safe and not without clear terms of reference to the licence applicants.

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This Bill seems to pre-qualify licensees on conditions which it sets and it is unfair to the third-party booking providers to prove themselves in order to gain market support and provide service to app users, especially new start-ups, who wish to venture into the market.

The Bill also seems to be protecting the interest of existing taxi companies by the conditions set within the Bill. Under one of its terms and conditions for application of the licence, the booking fees charged by third-party taxi booking services cannot exceed the booking fees charged by taxi companies, which runs contrary to a free market system and could impede operations. Commuters can use their discretion on which taxi services they want to book and pay more if they think they can get better and more efficient services with that particular taxi company provider to secure a booking.

For this reason, I would recommend a capping of the booking fee of 10% more than the usual booking fee set for all companies.

The intent to protect the interest of the taxi companies seems apparent because the taxi booking apps from the taxi companies are exempted from the Bill, apart from the point that they are exempted from the conditions of providing a taxi-booking service that is "safe, reliable and efficient".

When LTA decides to give directions to third-party operators when availability of a taxi is an issue under the proposed Bill, taxi booking services by companies, such as ComfortDelGro and SMRT, are not affected and can still offer the booking service to passengers.

From the available information in the public domain, we note that ComfortDelGro reported 35.6 million booking jobs in 2014. SMRT said that 40% of its taxi booking is through mobile app.

A common feedback that the general public has on the Bill is the possibility that LTA will state that taxi booking service cannot require commuters to specify their destinations before they can make bookings. This could also impede operations and rule out the possibility completely.

The term "picking and choosing passengers" is unfair to taxi drivers, commuters and the public.

Before the emergence of third-party booking services, passengers found it hard to book taxis in Singapore despite the availability of free taxis driving around the island. This is because the booking service provided by each company only extended to taxis under their

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own company and the methodology of assigning bookings to taxi drivers were inefficient as taxi drivers also are reluctant to pick up immediate bookings.

Taxi drivers get penalised if they refuse to ferry commuters to their destinations upon confirmation of booking by their taxi companies. While some taxi drivers "pick and choose passengers" for maximum revenue, many of the taxi drivers "pick and choose" because of the clash of schedule due to the location that the passengers would want to go to.

The introduction of third-party booking services and its success in matching taxi drivers to passengers spurred taxi companies to allow passengers to specify where their destination is so as to improve the booking success rate of the taxi booking service that they provide.

To the passengers, it is not unfair to them if taxi drivers do not pick up their booking but unfair to them if the taxi drivers on the street refuses to ferry them to their destination and that is already addressed in LTA's regulations.

Although it is not apparent in the Bill that third-party taxi booking services would be required not to allow commuters to specify their destinations in their bookings, but LTA is empowered to impose such a condition under clause 17 of the Bill.

Mdm Speaker, the Bill has a huge gaping flaw in its writing to deal with the matter it sought to do as it does not seem to address the issue of private taxi drivers, solely vetted by the company itself, working outside the main regulatory framework.

Taxi drivers, especially those who provide limousine services, have been complaining about the presence of limousine driver facilities by third-party taxi booking service's private vehicle drivers.

The wordings in the Bill for "taxi" describe a public service vehicle as defined in the Road Traffic Act and, therefore, seem to exclude third-party taxi booking services which facilitate booking of private car drivers by passengers from the Bill, and the necessity of being licensed by LTA.

Mdm Speaker, let us not forget that National Trade Unions Congress (NTUC) has close connections with ComfortDelGro and that SMRT is owned 50% by Temasek Holdings. Under section 12(1), there should be an independent body, other than LTA, to vet the required conditions and the issuing of the certificate of registration.

The penalty of up to $100,000 imposed on any providers which fail to comply with the conditions set by LTA is a good deterrent to errant operators but, on the flip side, would also

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deter small start-ups which might have issues dealing with administrative lapses that they might be penalised for.

Section 20(1)(b), under regulatory sanctions, the authority without compensation under subsection 2 against a registered provider if the authority is satisfied that the registered provider has failed to provide a third-party booking service that is safe, reliable and efficient, I would like to ask the Minister: how does LTA define a booking service that is safe, reliable and efficient? This will be very intimidating for someone who intends to register as a provider as LTA does not give clear definitions.

For the safety of drivers and passengers, I would suggest the recommendation to legislate technology companies operating taxi booking apps to compulsorily provide taxis with a strong, adjustable holder and handphone solely dedicated for use on the apps system only.

Mdm Speaker, will the third-party booking apps be fazed by this new regulatory framework and stifle competition?

In conclusion, there are pros and cons to a free market, and a regulated versus free market argument is one that has long been battled out and it is up to the active players in the market to react in the best interest of drivers and passengers.

Could companies that have taken part in the innovation from the ground up face the biggest backlash arising from the new regulations that might have affected their lucrative taxi booking services and heavy investment outlay?

Mdm Speaker, let me first declare my interest as a staff of NTUC and categorically mention that NTUC has no relationship with ComfortDelGro, as far as taxi services are concerned.

Mdm Speaker, there are four parties who may be affected by this new regulatory framework; namely, the commuters, taxi drivers, taxi operators and third-party booking operators. Let me first share on commuters.

We have all heard that the third-party taxi booking apps are fast gaining popularity among commuters. Besides making it easier to match taxi drivers to commuters, it also helps commuters at remote locations to find a taxi more conveniently. Whilst LTA has reiterated before that taxi services are de-regulated, efforts now to regulate third-party taxi booking

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should not be seen as a reversal of policy. Rather, it will give LTA the power to safeguard the interests of commuters.

Many of us learn of the concerns of third-party booking apps from news reports elsewhere in other cities, highlighting safety concerns and risks that commuters faced. Protests by taxi drivers in other cities against such apps and private hire cars also raise confusions on the legitimacy of such services. In fact, in many cities, if you read the news reports, the initial euphoria of cheaper commuting and greater flexibility has since evaporated and replaced by risks and concerns that commuters may face.

For our commuters, there are four concerns which I wish to highlight for which LTA may need to take steps to address.

First, I am glad that the regulations address concerns, such as whether the taxi driver dispatched by the third-party taxi booking apps has a proper vocational driving licence; and whether a properly inspected taxi is being used instead of a private car where issues, such as insurance coverage remain hazy; or whether the commuters will end up having to pay for hidden surcharges for using such services.

Secondly, most third-party taxi booking apps require commuters to set up an account and provide sensitive information such as credit card details. This raised concerns over how the service providers may use the data. I hope the Ministry can offer assurance whether the Personal Data Protection Act or other regulation will be able to address this particular concern.

Thirdly, there are also commuters who asked if non-taxis could be used for bookings made through app service providers. This is especially so as the same third-party apps operator can have different products and services to meet the needs of commuters, either for normal taxi hire or for private limousine services. Invariably, this will lead us to consider the role played by operators, such as Uber and Grab. You see, in the market, I think there is some confusion. For Uber, they have various sub-products ranging from UberTaxi, UberX and Uber Exec. For Grab, you have GrabTaxi and GrabCar options.

Commuters need to know under what conditions such private limousine services are allowed. For instance, some operators have this convenience built into their booking systems where after three unsuccessful taxi-matching efforts, commuters will be prompted with an offer for a private limousine service. Some commuters have been reported to be confused, not knowing whether to reject the car that came to pick them up or how to deal with or lodge complaints against these drivers should disputes arise.

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Fourth, the next concern relates to how some of these drivers and app service operators operate. Unlike conventional private limo services which only levy flat charges, some commuters are surprised when they find surge pricing levied by the new private car hire services they took on via these third-party apps. For example, during rainy weather or peak demand periods, such as concert, end of concert, end of major events, such services levy higher charges and many commuters are unfamiliar or unaware, feeling aggrieved that they may have been ripped off. Private limousine services should also not be offering metered charges but yet, their apps allow them to contain fare meter options similar to a taxi meter, whereby drivers can use it to take on street hails or driving by taxi stands or popular tourist attractions to offer their services to commuters and tourists.

The second group that may be affected are taxi drivers. To that end, I would like to declare my role as the Executive Advisor of the National Taxi Association. There are, indeed, increasingly, more taxi drivers who use these app services so that they can take on additional bookings on top of their taxi operator's booking, street hails and commuters waiting at taxi stands.

I would like to urge that LTA be ready to intervene when it is clear that the interests of taxi drivers may be compromised and there are four concerns that I wish to highlight.

First, how do we ensure that third-party taxi booking operators are held financially accountable? They do not have huge investments in vehicle fleet to at least be held financially liable should the need arise. Some drivers shared with me that they did not receive prompt payment of their fares from these operators, causing them cash flow problems, such as rental fees, fuel costs and ERP charges, that they incur daily. So, if there is a delay in collecting payment, they would have to find other ways to pay for these costs. Some drivers have also gone as far as to worry whether these operators will exit the market suddenly, taking along with them monies and incentives owed to taxi drivers or even refunds owed to commuters.

The second concern is: how do we ensure that third-party taxi booking operators treat our taxi drivers fairly? These new operators have started to choose taxi drivers, using their own internal rating systems to deactivate taxi drivers' accounts with the third-party taxi booking services. This is of particular concern as these app companies are seeing fast growing numbers of registered drivers and users. Whilst it is important to create new urban transport solutions, we have to be mindful that checks and balances need to be in place to ensure that no one operator becomes the most dominant and end up with the power to dictate the way services are delivered, how fares are set and how drivers are selected.

Taxi drivers also shared with me that there are increasingly more incidents of commuters who made bookings but did not appear at the pick-up points. A driver recently

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related his experience where the commuter he picked up using his taxi operator's call booking system also made a booking using the third-party apps, resulting in two taxis arriving at the same location to "fight" for the same commuter. There are currently no penalties imposed on these no-shows but, conversely, if a taxi driver does not appear on time, he faces disciplinary action by the taxi operators, and now, he, too, faces disciplinary action by third-party taxi operators. And taxi drivers may also be blacklisted from future bookings or even be called up for interviews by LTA should the commuters send in a complaint.

Thirdly, taxi drivers also shared how drivers of private limousine services start to show up at taxi stands to pick up customers they have secured using third-party booking services. There have been instances of those who even tout their services at taxi stands, cruise terminals, tourist attractions, hotels and night spots and even compete for street hail jobs using their metered functions in the apps. We have surfaced the feedback to LTA and it is important that educational efforts be enhanced and enforcements be undertaken so that the drivers and commuters know where the regulations lie, relating to these two different types of transport services.

Fourthly, should there also be regulations governing the licensing of private limousine services and the types of drivers they hire? Currently, these drivers do not need to possess a vocational driving licence and there are no requirements for retraining, unlike those imposed on taxi drivers. Some have called for these drivers to undergo security screening, medical check-ups and compulsory MediSave top-ups and LTA's Vocational Licensing Points System be levied on them. For a level playing field, it may be necessary for LTA to also regulate third-party bookings and drivers for private limousine services.

The third group of persons who are affected by this new regulation are taxi operators. Currently, taxi operators in Singapore have to meet strict service and availability standards set by LTA. They have also sunk in huge investments to meet these licensing conditions. In fact, not long ago, a taxi operator had to surrender his taxi operator licence and sell off his fleet because he failed to meet the standards.

Today, not many cities in the world have ventured into legislations on the use of third-party taxi apps. This is despite the fact that many taxi operators and their hirers have taken their displeasure to the streets with the uneven level playing field available to third-party booking services. As such, LTA's move to ensure some level of consistency and business operating conditions for third-party booking operators should be a welcome move by the taxi operators in Singapore.

The fourth group is the new group of players in this market and these are the third-party service operators. Disruptive technologies, such as those brought on by third-party taxi booking apps, are bringing about new urban transport solutions and prompting existing

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operators to explore new possibilities to stay competitive. As these apps are able to link commuters and drivers from all taxi fleets, they have maximised the matching processes.

While these have been popular and convenient, some of their practices, however, are questionable. For instance, some operators have been advertising through their apps that their fares using their own private limousine services can be cheaper than taxi services, leading commuters to feel that the two are the same. These operators have also urged drivers to set up their own transport company and legally become a one-man private limousine service. Thereafter, they will lease a car to these drivers and send them bookings through their third-party apps. In reality, limo rental companies and third-party booking operators should employ these drivers instead.

Mdm Speaker, we need to right-size our rules. I agree that we need not start off with too many rules to reduce all the risks that commuters and drivers may be exposed to. We should instead take note that commuters' habits are changing and that it may be better to regularly review the rules governing the relationships between commuters, taxi drivers and taxi operators. For example, the existing tripartite framework involving LTA, taxi operators and the National Taxi Association can also be expanded to include the third-party taxi booking service operators. Incorporating them into this framework may enable them to emulate efforts by existing taxi operators, for example, by contributing towards helping taxi drivers with their MediSave contributions and other positive efforts that they can do to create a better industry for all.

Under the new regulatory framework, I am also uncomfortable with the restriction that says taxi booking services cannot ask commuters to indicate their destinations. Third-party booking apps allow us to consider the possibility of implementing a taxi shuttling service. While this is not available today, this service can help us resolve some level of our taxi availability issues and make every taxi work harder, but not necessarily every taxi driver. These smart apps can easily calculate the fare for each driver based on the pick-up and drop-off locations, offering separate meters for each commuter in the same taxi. The driver can pick up two to three commuters along the way if the apps can assign the jobs effectively. People do not need to necessarily board the taxi at the same point, but they can be dropped off at points near to one another.

Furthermore, the prevalent use of third-party apps has already hit our shores. We should also find ways to acknowledge their role in addressing taxi availability and also take a relook at the Taxi Availability Indicators, especially in relation to the 250-kilometres daily mileage requirement where, with better taxi matching, there has been less empty cruising and enhanced taxi availability at remote locations.

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Mdm Speaker, beyond taxi booking, it is important that our early efforts in regulating app booking or matching services send the right signal to investors, inventors, users and businesses. To this end, I believe Singapore can be the right place to promote innovations of technologies to solve urban needs – not just taxis but other urban needs – and yet, be the unique location to have the right-sized regulations to ensure that all the stakeholders' interests are safeguarded.

I would only like to urge that at the end of the day, no one single operator or industry player should be allowed to have huge control of the market share, whether in terms of customer base or drivers' fleet, to the extent that the dominant player ends up dictating the service delivery and terms, benefiting neither the commuters nor taxi drivers. With that, Mdm Speaker, I support the Bill.

Mdm Speaker, first, let me thank all four Members who have spoken on the Bill and for their expression of support. They have raised a range of different issues. Let me start by addressing those issues that are not covered under this Bill called the Third-Party Taxi Booking Service Providers Bill.

Mr Seng Han Thong, Mrs Lina Chiam and Mr Ang Hin Kee gave their comments on distinguishing between taxi booking services and chauffeured vehicle matching services. So, there is a taxi part and there is a chauffeured vehicle part, especially if these are offered by the same service provider on the same smartphone application, and how this could give rise to some amount of confusion.

Some third-party taxi booking services in the market today – GrabTaxi, Easy Taxi and UberTAXI – can also match their users to chauffeured vehicle services. This is actually not a bad thing, because chauffeured vehicle services can plug the gap when taxi demand is extremely high. For instance, on some Friday evenings, it can be difficult to hail a taxi on the road, or even to book one. And for those who really would like to pay more just in order to be able to get a ride to their chosen destination, chauffeured vehicle services actually can be the means for them to do so. So, some people welcome the convenience. They do not mind paying more to book a chauffeured vehicle service now and then, especially when demand for taxi services is high.

But what we want to do is to make sure that commuters are allowed to choose and receive the service they want and, therefore, we will require service providers to provide clear, and not misleading, information on the different services available.

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This is why the proposed regulations will require service providers to ensure that their taxi booking service and any other transport matching service that is offered under the same application are clearly distinguished from each other, for example, by using separate and distinct icons. The differences in charges between these services must also be highlighted upfront and highlighted clearly. Furthermore, as mentioned earlier, third-party taxi booking service providers can only dispatch licensed taxis and taxi drivers if the commuter requests taxi services specifically. So, the third-party booking app is prohibited from sending a chauffeured vehicle and charging chauffeured vehicle rates if a commuter books only a taxi on his third-party app.

I note also Mr Ang and Mr Seng's concerns over the impact that the growth of chauffeured vehicle services has on taxi drivers, and their suggestion to perhaps consider imposing more regulations on chauffeured vehicle service industry. While this is not within the scope of this Bill, I do acknowledge the concerns raised. Let me briefly outline the Government's current approach towards this issue.

Chauffeured vehicle services are not new. They have been available in the market. They are commonly used, especially for corporate trips and special occasions like weddings, for instance. But what is different today is that the technology has made these services much more easily accessible in terms of matching passengers to chauffeured cars more seamlessly, just like how technology has improved the matching of taxis to commuters.

There are regulations in place for chauffeured vehicle services. They must be pre-booked. They cannot be hailed on the streets or pick up passengers at taxi stands like taxis – this is one distinction between taxi services and chauffeured vehicle services. I know Mr Ang mentioned this point, and we certainly welcome feedback and specific information that we can use to track the individuals and the use of such vehicles so that LTA can investigate this more thoroughly.

Chauffeured vehicle services can only use private hire vehicles, which must be registered to business entities. They must also have the necessary insurance cover to be used for hire or reward. Private cars cannot be used to provide chauffeured vehicle services, and any person who does so is liable, on conviction, to a fine, imprisonment and/or forfeiture of his vehicle.

The law is clear on the classification of the various types of vehicles and the regulations for each class. The penalties are stiff. LTA will strictly enforce against people who are found to flout the law.

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Similar to taxi services where fares have been deregulated since 1998, fares for chauffeured vehicle services are also not regulated. Different service providers charge fares in different ways, depending on the type of services offered and market conditions. This, I believe, encourages more competition and provides a wider variety of services for commuters, although commuters need also to be mindful of the terms and conditions before engaging such chauffeured vehicle services.

Let me also clarify that it is not against the rules for chauffeured vehicle services to utilise their apps as a "meter" to charge passengers based on distance travelled and/or time taken. Some chauffeured vehicle services already do this, while others offer a flat rate. Commuters are free to choose which service they prefer, taking into account the charging methods.

Mr Seng Han Thong has suggested requiring drivers offering chauffeured vehicle services to hold some form of vocational licence or certification. This is something that we are prepared to consider in the future, if we decide that we need to further regulate the chauffeured vehicle services industry. But at this point in time, I would encourage the service providers to do more to train and to develop the competency of their drivers and to monitor the performance of their drivers more closely.

We will continue to monitor the chauffeured vehicle service industry. We will refine the regulations if needed. We know that in many countries and cities, there is a tussle involving the taxi companies and taxi drivers on one side, who feel that the responsibilities on them are much more onerous, versus chauffeured vehicle services on the other side, with a lot less regulation and a lot less pressure on these other services. So, we are watching it closely and Members can be assured that we will take steps, if necessary, to address any concerns that may arise in our current situation.

Overall, to sum it up, the chauffeured vehicle service industry is fundamentally different from the taxi industry, even if the line today is no longer as clear as it was before. Also, to some extent, many chauffeurs are today former taxi drivers and they welcome the flexibility of another employment option. So, it is also necessary for us to be quite cautious in how we go about further regulating the chauffeured vehicle industry if we are mindful to do so.

Having addressed that, let me move back to the main topic on third-party taxi booking services. One of the more innovative features offered by some apps is the ability to provide post-trip feedback on taxi drivers. Such feedback mechanisms help to improve accountability, which, in turn, enhances safety for commuters and encourages higher service standards. In fact, one taxi company – ComfortDelGro – has recognised this benefit and built in a similar feature in the latest version of its own booking app. So, there you see the interplay between third-party taxi booking apps and some of the features that they have and how it links back

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to what the taxi companies are doing. And some of these features can actually help to raise the overall standard of the provision of taxi services in Singapore.

It is also understandable that third-party service providers would want to set internal service standards for their drivers to meet, so as to differentiate themselves to attract as well as retain commuters. On the other half of the equation, some service providers charge a cancellation fee if a commuter cancels his booking, or ban commuters for repeated no-shows. This helps to protect the taxi drivers to some extent. Overall, there are positive developments which benefit the taxi industry.

Mr Ang Hin Kee also spoke about some taxi drivers receiving late payment from service providers, causing them cash flow problems. I understand these concerns. That is why even while we want to try and keep the market competitive, and we do not want to over-regulate, there have to be certain minimum thresholds before we allow some of these service providers into the system. On one hand, certain Members have talked about clause 10 of the Bill and asked why LTA needs some of those criteria to assess an applicant, why not allow this to be a completely free market. On the other hand, I think Mr Ang has also talked about the need to hold third-party service providers financially accountable because they can exit the market suddenly and they need to treat the drivers fairly. So, we are trying to find the right equilibrium point, the right balance. We need to keep the market competitive so that there is every incentive for service providers to manage their drivers well and provide good services to commuters.

It is not good for the taxi industry in Singapore if we just let any and every applicant, even though it may be below the threshold, into the market. As we have seen in Singapore today, we have quite a number of third-party service providers competing with each other. We think that there is actually more room for others to come in as well, provided they are serious players, provided they treat their drivers fairly and provided that they are financially strong and they are able to last the competition in the market.

Having said all that, I think there may still be occasional disputes between taxi drivers and service providers. Here, I encourage the National Taxi Association – as the representatives of taxi drivers – to assist them in exploring the avenues of recourse available. And LTA stands ready to assist, if necessary.

To Mr Seng Han Thong's query, LTA will modify the Taxi Service Operator Licence to apply the regulatory conditions on third-party taxi booking services to taxi booking services offered by taxi companies, where relevant.

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Moving on to possible concerns from commuters, Mr Ang Hin Kee may wish to know that third-party taxi booking service providers must comply with all applicable laws, such as the Personal Data Protection Act, and ensure that the privacy of commuters is appropriately safeguarded, as well as the data that they hold.

Some service providers collect personal information, such as credit card details, to provide a more seamless booking and payment experience for their customers. There are also other service providers that do not necessarily require such information and these can cater to commuters who are not so comfortable with providing their personal information.

Mr Ang Hin Kee and Mrs Lina Chiam voiced some discomfort that the regulations will prohibit third-party taxi booking services from mandating commuters to specify their destination when making a booking. This condition is important. It addresses concerns amongst commuters that some taxi drivers may not accept bookings when they see that the passengers are travelling only short distances, or to certain locations that are more far-flung or where there is a lower chance of picking up another fare on their return journey. We do not want taxi drivers to cherry pick their fares. This is consistent with the approach that we have taken for street hail.

So, we need to clarify and make sure that it is properly understood that commuters, if they choose to do so, can still indicate their destination if they want to. Commuters can still choose to indicate their destination if they think that this will increase their chances of getting a taxi. But what the regulations spell out is that they are not compelled to do so. So, the choice is with commuters – you choose or you choose not to. You choose maybe because you think it gives you a better chance of getting a taxi or, in certain instances, commuters say that "I better choose not to so because if it is too short a distance, or if it is to a far-flung place, the taxi drivers may actually prefer not to take me or respond to my booking".

Mrs Lina Chiam had another area of discomfort, which is that the booking fee that third-party service providers can charge cannot exceed that charged by taxi companies. She felt that we should let the free market prevail and let the service providers charge what they wish, to a limited extent.

I will explain the reasoning for this. I do not want to give third-party service providers the flexibility to charge higher than the taxi companies because I know that in a very short while, the taxi companies will come back to me and say, since MOT allowed a third-party app to charge $4, instead of $3.30, for instance, as a taxi operator, I also want to do the same. I do not want that to happen, because it will lead to price inflation for the commuter. Today, there is a certain standard that we have arrived at over time. This is what the taxi companies

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charge, so we require the third-party apps to charge at this level or no more than this level.

Mr Seng Han Thong asked whether LTA would look into the existing QoS standards imposed on taxi companies for call booking. So far, we have not observed any significant deterioration in their QoS performance. What we plan is for the third-party service providers to give us their data on bookings and which taxis from what companies answered to these bookings, so that we can match this together with the data provided to us by the taxi companies. If some taxi companies fall short and they claim that it is because their taxis have all been answering to all these other bookings, we can match the information provided by the third-party taxi service providers and the taxi companies. That is the intent behind some of the regulations.

In a nutshell, Mdm Speaker, this Bill aims to safeguard commuter interests by implementing a basic regulatory framework for third-party taxi booking services. At the same time, we hope it provides sufficient space for those services to grow and we believe that, over time, as we have seen already, it will benefit both commuters as well as taxi drivers.

Thank you, Madam. I would just like to seek the Minister's answer to the question I asked about clause 10(b): why LTA would be basing its decision on licensing the third-party taxi booking services on the existing demand of these taxi booking services. It should not matter whether or not there is demand, because if there is demand, then the service would be used and, if there is no demand, then the service would just fade out. So, there is no need for the regulator to decide for the consumers.

Mdm Speaker, I think the Member has made a fair point. Overall, clause 10 gives LTA the opportunity to more comprehensively assess the potential of a possible player as well as the potential impact that an additional third-party taxi booking service has on our transport landscape. We always need to have that flexibility in order to assess the impact as well as to assess that individual applicant.

But I do agree with the Member that all service providers, ultimately, need to assess the market conditions for themselves and the viability of their business case. Our approach and intent are to be light touch, to be facilitative, but we also want to avoid some of the problems that Mr Ang Hin Kee had mentioned where third-party service providers have delays in paying the drivers, refunding monies and so on, and we want to try to minimise

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those situations as much as possible.

The Minister earlier mentioned that chauffeured service vehicles, basically, will regulate their drivers, put them on training and the like, but the reality in the market today is, a lot of the limo leasing companies are urging individual drivers to register themselves as a company. After you register yourself as a one-man company, you go ahead and rent a vehicle from this limo services and you take on bookings from the third-party apps.

In essence, they are flying under the radar and trying to operate without having to be a company with drivers assigned to themselves. They are themselves one-man shows. This in itself leads to many behaviours and activities on the ground, such as vying for taxi stand commuters, operating very much like taxi drivers.

So, I hope that LTA will pay particular attention to this category because, to all intents and purposes, what they are basically doing is to operate like taxi drivers without having to comply with any of the regulations. In reality, if this phenomenon is allowed to grow, it will really put a lot of delays in our efforts to try to ensure that the third-party taxi booking services in Singapore grow in a proper manner whereas you have another group that is basically behaving in an illegitimate manner.

Mdm Speaker, I thank the Member for the feedback. It is something that we are mindful of. In fact, LTA has been stepping up its checks both in response to whistle-blowers as well as mystery shopping that it is doing on its own. In recent months, there were a couple of cases that we managed to catch where these people were flouting the law. Moving forward, if the Member knows more of such cases, or if taxi drivers know of more of such cases, please do report them to LTA. Like I said, we will be happy to step up the checks but also, over time, look more carefully into the issue that the Member has raised, whether there are measures that we need to take, regulations that we need to adopt, in order to arrest this issue.