On 22 June 2016 the NSW Government passed the Point to Point Transport (Taxis and Hire Vehicles) Act 2016 (‘the Act’) and the Point to Point Transport (Taxis and Hire Vehicles) Regulation 2016 (‘the Regulations’). Together, they introduced new regulation over taxis, rideshare and other hire car services in the state.

The Government saw the point to point transportation policy as a necessity to level the playing field for point to point transport in NSW, largely as a response to Uber.

This legislation deregulates some areas for taxis such as fares and licensing) while introducing regulation for rideshare providers such as Uber. These reforms have appeared in the midst of increased apprehension surrounding Uber in Australia, and the potential for a new wave of rideshare services cropping up in the future. An analysis of the legislation is warranted, and here is discussed in the context of broader questions about how the government is fostering innovation.

The Legislation

At its helm, the Act collates taxis, rideshare and hire cars into the broad phrase ‘passenger services’. It is given the meaning: “the transport, by a motor vehicle (other than a bus), of passengers within, or partly within, this State for a fare”. The notion of passenger services is then applied to three sub-categories:

  • Taxi Services: those passenger services that are taxis;
  • Hire Cars: those that aren’t taxis; and
  • Booking Services: those that provide booking applications or facilities to book passenger services.

The definitions seek to capture every form of fee service whether booked or not. It specifically excludes other forms of public transport such as buses, trains and aircraft. The NSW Government coined the term ‘Point to Point’ transportation and refers to this ‘passenger service’.

By and large, the three sub-categories mentioned are regulated in much the same way within the Act. However, the taxi industry retains certain perks and extra conditions, while the door has been left open to regulate more or less in the future.

We look at some of the aspects of the legislation below, but first a point about wheelchair accessible vehicles. The Government is actively looking at its options to entrench measures that provide incentives for more wheelchair accessible vehicles for those in need. As such, the Government has planned to bundle new reforms into a later edition of this Act once the Point to Point Transport Commission is up and running.

Authorisation and Licensing

The Passenger Transport Act 2014 sets out the requirements for individuals providing rideshare, hire or taxi services to be individually licensed on NSW roads. The Roads and Maritime Services (‘RMS’) is responsible for issuing licences. Currently, the RMS provides forms for applying for a variety of taxi licences. For example, a ‘Private Hire Vehicle – Driver Authority’ and other operational and transitional licences. These licence categories are in some ways regulated and impacted by the Act alongside the Passenger Transport Act 2014.

For example, the Act sets out the available taxi licences, for which there are a variety of categories. The regime for taxi licensing is still heavily regulated. The NSW Government has sought to relax areas of licence conditions. One of these in the Act is the extension of the default area of operation of licences to be anywhere in NSW. Formerly, the areas of operation were licence based, meaning you paid for the area you wanted to solicit business from.

The new Point to Point Transport Commissioner will be responsible for fees, classes and conditions of licences. These have not yet been disclosed. A particular advantage of taxi licenses and taxis generally that the Act has included is that the licence is a proprietary asset that can be leased and sub-leased with relatively limited interference from the Commissioner. Further, under the Act (and the Passenger Transport Act 2014) taxis are the only vehicles that can be hailed, ply or stand for hire and have exclusivity over cab ranks.

The Act also sets out the requirements for authorisation, and this applies to booking services. This section of the Act appears to regulate providers, such as Uber or other rideshare platforms, through their provision of the booking platform or service provided to their drivers. Again, the new Transport Commissioner has yet to articulate the particular form of authority and conditions.

Safety

The Act introduces two new safety constructs:

  • Safety duties; and
  • Safety standards.

The safety duties require the passenger service providers and booking service providers to ensure the health and safety of drivers and other persons while providing the service, whether through the booking service or otherwise, so far as reasonably practicable.

To satisfy this duty, the Act mandates the elimination of risks to safety so far as reasonably practicable. If this is not possible, to minimise those risks as far as reasonably practicable. ‘Reasonably practicable’ is a standard which asks what the ordinary person in that position would have to do to meet the health and safety duty.

The safety duty also applies to drivers, requiring them to ‘take reasonable care’ for their health and actions or admissions as to the health and safety of other persons.

The safety duty should not be taken lightly. Breach of the duty results in criminal offences that cascade in severity depending on the nature of the exposure to harm and the provider/driver’s intentions. Such breaches can lead to imprisonment, and/or fines between $50,000 and $300,000 for individuals and $500,000 and $3,000,000 for companies.

The safety standards are conditions that attach to the drivers or providers for things such as licence conditions, insurance, safety and registration and reporting (amongst others). The Regulations may provide that certain standards are binding. At present, the Regulations do not enumerate standards leaving it up to industry for the moment.

Oversight

As has been briefly alluded to the Commissioner has the ultimate oversight for the point to point transportation regime. The Commissioner can introduce officers to monitor compliance, or give police broader powers to do so.

To name some of these extra powers, the Act allows officers (in certain circumstances) to:

  • Stop or detain vehicles;
  • Enter premises;
  • Require the production of documents; and
  • Apply for search warrants.

Levy and Support Payments for Taxis

The Act provides a transitional safety net for taxis and certain hire car providers regulated under the old regimes. The assistance package totals $250 million over five years and is broadly applied to:

  • Licence transitions for taxis;
  • Hardship payments for tax licensees; and
  • Buybacks for perpetual hire car licences.

The package is being funded by a $1 levy on all passenger services over five years.

Point to Point Transportation and Innovation

The Minister for Innovation, Victor Dominello, has indicated a commitment to innovation in NSW. This commitment, coupled with the sluggish response to Uber in NSW, are good assumptions behind the impetus to pursue legislative reform.

The arguments for and against ridesharing are many. On one hand, the taxi industry has argued for the necessary safety of passengers. Others have argued that the protections afforded to the taxi industry have stifled innovation in the transport space. With Australia’s commitment to innovation, the Act and Regulation are a positive step in finding the middle ground between protection and change.

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What do you think about the Point-to-Point Transportation policy? Let us know your thoughts on Twitter @LegalVision_au.

Paul Loccisano

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