Strike the right balance when regulating mobility apps - ITF

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Don`t warn off innovators ITF warns government

Don`t warn off innovators ITF warns government

Regulation of app-based mobility services should be carefully balanced to tackle their negative elements while not hindering further innovation, says a new report from the International Transport Forum (ITF). There is also a risk that lobbying by existing mobility providers such as taxi firms could lead to regulation that undermines new innovators in the short term, the report warns.

The ITF recognises that some control is needed for mobility services such as ridesourcing, pioneered by Uber, as well as dockless bikeshare and e-scooters. With ridesourcing, there have been concerns over the safety and security of users, insurance cover in the case of accident and injury and the labour conditions of drivers, along with congestion and pollution, the report notes. 

Meanwhile, there are concerns that dockless bikeshare and e-scooters can pose “potential conflict” with other mode users, says the ITF. They have also been found to clutter public spaces “with excessive numbers of sometimes derelict bicycles and scooters”.

Many ridesourcing firms have exploited ambiguity over regulation to enter markets quickly and effectively, the report points out. The disruptive impact of app-based services has led to some governments initially trying to suppress these new businesses, particularly in the case of ridesourcing, said the ITF. 

“However, strong consumer demand for these services has in many cases led to rapid changes in government stances, with prohibition giving way to light-handed regulatory approaches. These, in turn, have sometimes been criticised as failing to deal adequately with the downsides of new mobility services, giving rise to demand for more restrictive regulation. Complaints that incumbents are unfairly disadvantaged in competing with disruptors are also common.”

There is a clear need to protect consumers from the “risk of significant harm”. But any regulation should consider the “uncertain viability” of app-based businesses, especially dockless bikeshare and e-scooters. Small trial schemes with limited regulation would provide valuable insights, the report suggests. 

App-based mobility services have brought “substantial consumer benefits” such as convenience and comfort as well as driving down prices. “They have allowed rapid and reliable matching of services and customers, provided for reliable, cashless payment and enabled effective identification of riders and drivers and recording of journeys.”

These benefits should be noted when considering any negative impacts on broader urban policy objectives.  

Regulation should, as far as possible, be adaptable in the face of innovation and should seek to promote the inclusion of all social groups, including those with limited mobility, says the report.