No compromise reached in ‘Uber Clause’ consultations

Taipei, The Ministry of Transportation and Communications (MOTC) and ride-hailing service company Uber failed to resolve their differences over a new rule that will prohibit Uber from using its current operating model in Taiwan.

The 60-day consultation period for the new proposal concluded on Friday, and the MOTC said it will now review public comments received during the period, go through a final review process, and draft measures for Uber drivers who want to become taxi drivers before the new rules take effect.

"Our direction remains unchanged, and Uber must choose between operating with rental car companies under the new rule, or becoming a taxi company to continue its current service model," MOTC official Hu Di-chi told CNA.

The proposed changes announced in February would prohibit drivers partnering with rental car companies, with whom Uber has been working over the past two years, from driving around looking for passengers or waiting for fares at taxi stands or other areas.

Fares would also have to be charged by the hour or the day, according to the proposed Article 103-1 of the "Regulations for Automobile Transportation Operators," dubbed the "Uber Clause."

Under Uber's current model a compromise reached with the government to allow it to continue to operate in Taiwan it is supposed to use its service with drivers who use cars from rental car companies or register their own cars with such companies.

But the government decided to go after Uber when taxi drivers complained that the Uber model was simply a taxi service under another name and was hurting their business.

The new regulations would likely take away Uber's main advantages in Taiwan.

While it remains uncertain when the new regulations will be enacted, Hu said the ministry has no plans to hold further talks with Uber, which the U.S.-based company has asked for.

The ministry later said in a statement that it has talked with all stakeholders during the consultation period, including Uber, rental car and taxi companies.

If Uber wants to operate as it does now, it should be covered by the ministry's "multi-purpose taxi program," MOTC Deputy Transportation Minister Wang Kwo-tsai said on April 23.

That program permits flexible rates with a minimum fare base, without having to change Uber's general operating style, including the appearances of its vehicles, Wang said.

All Uber would have to do is invest NT$5 million (US$162,000) to set up a taxi company and have its 10,000 drivers take a test to obtain the taxi service operating permit needed to go with the taxi driver's license they already hold, Wang said.

That has always been a problem in Taiwan for Uber, which insists it is a technology company and not a transportation company and should not be subject to transportation laws.

Emilie Potvin, Uber's head of public policy & government relations in Asia Pacific, criticized the MOTC, however, as simply "shoveling clouds," meaning it has been vague and lacking in substance, because it has failed to provide further details, timetables or technology solutions.

"What a responsible government should do right now is to appoint someone who can lead a consultation process, get everybody at the table," she told CNA on April 24, saying that Uber has never been involved in the talks.

In response to the end of the consultation process on Friday, Uber said in a statement that "despite our efforts to communicate a win-win solution, we feel that a fair resolution is still some way off."

The firm also called on the government to listen and respond to opinions from Uber's 10,000 driver partners, over 200 rental car companies, and 3 million consumers across Taiwan who have been supportive of Uber and to include them in future discussions.

Also on Friday, local taxi drivers urged the MOTC to introduce the amendment as soon as possible to solve the Uber issue, arguing that the company operates illegally in Taiwan because it works as a de facto taxi dispatcher but does not follow related laws.

Source: Focus Taiwan News Channel