Grabtaxi: New regulatory policy will not affect its operations

The Third-Party Taxi Booking Service Providers Bill was passed in parliament on 11 May 2015 to allow Land Transport Authority (LTA) powers to regulate taxi booking service provided by third-party companies.

The transport minister, Mr Lui Tuck Yew in his address to parliament said that the regulatory framework provided by the bill, balances the need for consumer protection with the flexibility needed for innovation in the taxi industry, so that the taxi booking services can enhance the provision of taxi services in Singapore, which would benefit both commuters and taxi drivers.

With the passing of the bill, third-party taxi booking services that have more than 20 participating taxis will be required to register with LTA in order to operate in Singapore.

The service providers will be required to adhere to guidelines such as specifying fares and surcharges to commuters upfront, providing LTA with live data on bookings, following directions from LTA when certain conditions arise, and to provide taxi booking services that are “safe, reliable and efficient”.

Flouting the regulations can lead to fines of up to $100,000, suspension or having licences revoked.

Taxi booking apps of the existing taxi operators are exempted from the regulatory bill.

TOC wrote to one of such third party taxi booking service providers, Grabtaxi to understand from the company if the company foresees any significant issues to its operations.

Grabtaxi in its response to TOC, said that it does not foresee no significant issues to its operations and is confident that the company will continue to significantly grow and scale its business.

“GrabTaxi has always been working with regulators to help create a fair and even playing field in the local transport industry. Because we’re always engaging with the regulators and maintaining an open communication channel, we are already mostly compliant with all the new regulations set forth by the regulator and will definitely be compliant by the stipulated deadline.” responded a GrabTaxi spokesperson.

When asked if the company was being consulted by LTA or any other ministries prior to the passing of the regulatory act, the GrabTaxi spokesperson said that the company maintains close relations with the relevant authorities and have continuous on-going, constructive dialogues with them since its operation started in Singapore.

“We are confident that our conversations and constructive discussions have helped develop the framework for this policy.” said the GrabTaxi spokesperson.

While Grabtaxi is unable to share the exact number of bookings that it processes in Singapore, the GrabTaxi spokesperson gave the figures of its regional booking to be about 7 bookings a second.

And just to show how much Grabtaxi has grown in acceptance by commuters in Singapore over the past year, it currently receives more taxi bookings in a single day than it did in the whole month of January 2014.

The need of regulate third party booking services, as said by Mr Lui in parliament, is also due to their growing presence despite taking up a relatively small market share of the taxi bookings in Singapore.

“Today, about one-fifth of taxi trips are made via phone or app bookings. Based on the Taxi Customer Satisfaction Survey that we did last year, about 80% of these bookings are made through the taxi companies. In other words, 20% of all taxi trips are made through phone or app bookings, 80% are street-hailed. And of those that are made via phone or app bookings, about 80% are made through the taxi companies. The remaining 20% are made through third-party apps. In short, about 4% of taxi trips today are made through such third-party apps. But it is something that is growing.”

There has not been any deadline set for companies such as Grabtaxi to comply based on the set regulatory framework. Companies would be informed by LTA  when they would need to comply to the regulations.

GrabTaxi has said that it is ready to comply as and when needed by the relevant authorities.