The ACT has become the first Australian jurisdiction to legalise ride-sharing services such as Uber in a bid to boost competition and innovation in the territory.
The 2015 Taxi Industry Innovation Reforms will see Canberra become the first capital city in the world to legalise and regulate ride-sharing before the services begin as Uber plans to launch in the territory soon.
The changes, which come into effect on October 30, will see ride-sharing drivers given full background and criminal checks as well as preventing services such as Uber from raising their prices during disasters, it has been revealed.
Taxi drivers will also see their fees and registration cut in half over the coming year, with a 75% reduction to follow the year after reforms take hold.
NRMA Insurance executive general manager of product & underwriting, Tracy Green, backed the move and welcomed clear direction from an Australian government as other states grapple with ride-sharing issues.
“We commend the ACT Government
on being the first to provide clarity and consistency in the regulatory treatment of ride sharing services,” Green said.
“This will better protect drivers and passengers, provide a level playing field for traditional transport providers and ultimately raise the bar for safety in the broader transport industry.”
NRMA are currently the only major Australian insurer to offer coverage to occasional Uber drivers, which has seen them rebuked by the taxi industry, but the ACT changes ensure that all drivers are adequately insured.
The ICA also praised the move with CEO Rob Whelan, noting that the new legislation features many proposals suggested by the council.
“The introduction of a separate compulsory third party insurance (CTP) category for ride-hail drivers will reflect the higher risk they are likely to represent due to spending on average more time on the road,” Whelan said.
“It also means that, like taxi and hire car drivers, their higher CTP premiums will deliver adequate funds to meet claims without forcing private motorists to subsidise their costs.
“The ICA recommended this course of action in its submission to the ACT Taxi Innovation Review in June, and we’re pleased it is being introduced.”
Matthew Kayrooz, chief underwriting & portfolio manager – CTP for Suncorp
Commercial Insurance, also backed the ACT move and noted that Suncorp
, through GIO, will work with the Government
anyway that it can.
“GIO welcomes the ACT Government
’s regulation of ride sharing,” Kayrooz said.
“GIO believes that competition in a well regulated market provides the best benefits for consumers.
“From a Compulsory Third Party insurance (CTP) perspective, GIO will work with the Government
and the regulator on the next steps.”
In a statement on their website, Uber praised the decision and backed other states to follow the lead of the ACT with “sensible, safety-based regulations,” to help both customers and drivers.
“We’re thrilled that the ACT Government
announced today that it is embracing ride-sharing and welcoming uberX to the capital. Sensible, safety-based ride-sharing regulations will be in place for the ACT from the end of October, leading the way for permanent legislation in the coming months.
“Chief Minister Barr and the ACT Government
have shown true leadership in their progressive approach to bringing a safe, affordable and reliable point-to-point transport alternative to Canberra through their transparent review process and open and constructive dialogue,” the statement continued.
However, the CEO of the Australian Taxi Industry, Blair Davies, was quick to criticise the decision saying that the move benefits a $70 billion company while making it tougher for taxi drivers.
"We are very disappointed by the ACT's decision,” Davies said in a statement.
“They have rushed it through to look 'popular' and ride on the coat tails of Uber but in so doing have failed to address a number of real issues and have not really served the Canberra community at all.
“They have failed to work with insurers, the taxi industry and the hire car industry and have fundamentally let everyone down.
“The ACT Government
’s decision may be good for Uber, a $50 billion USD ($70 billion AUD) private company, but for hard-working cabbies who [are] already doing it tough in Canberra's soft economy for services, it’s just a further kick in the guts."
Green continued that the customer comes first for their business and sees ride-sharing continuing to grow across the country.
“As an insurer, our first priority is to protect our customers and meet the changing needs of Australians, which is why we provide cover for people who use their cars for Uber X.
“Ride sharing is here to stay, and we’re pleased that the ACT Government
is taking steps to formally integrate this emerging form of transport.
Green stressed that the IAG
-owned business will look to work with the ACT Government
on innovative insurance solutions for ride-sharing services and looks forward to a bright future.
“NRMA Insurance is open to working collaboratively with government and road transport networks to develop appropriate insurance solutions for ride-sharing activities.
“We look forward to working with the ACT Government
as they develop a customised CTP and property insurance regime tailored to the sharing economy,” Green added.