Competition Bureau calls on regulators to modernize taxi industry regulations - White paper recommends regulatory overhaul to enhance competition and choice, and lower prices for consumers

OTTAWA, Nov. 26, 2015 /CNW/ - Regulations governing the taxi industry must be overhauled to allow taxis and ride-sharing services to compete on an even playing field. Consumers stand to benefit from lower prices, reduced waiting times and higher quality services if regulators allow the forces of innovation and competition to shape the industry.

These are the main conclusions contained in a new Competition Bureau white paper entitled "Modernizing Regulation in the Canadian Taxi Industry".

The taxi industry is regulated at the municipal and provincial levels in Canada. While taxi companies are subject to these regulations, ride-sharing services are not. This creates an uneven playing field in the industry. To even the playing field, where possible, regulators should relax restrictions on traditional taxis, rather than imposing additional regulations on new entrants in the industry. When new regulations are needed, they should be limited to meeting legitimate policy objectives, like protecting the safety of passengers and drivers. 

The Bureau supports efforts to regulate ride-sharing applications instead of prohibiting them. Competition is the best means to ensure that consumers have access to the broadest range of products and services at competitive prices.  

For more information on the Bureau's recommendations, please consult the backgrounder.

Quick facts:

• There are about 30,000 taxis providing transport services in Canada, according to the Canadian Taxi Association.
• Canadians spent almost $1.2 billion on taxi and limousine services in 2014, according to Statistics Canada.
• A report by the City of Ottawa in October 2015 found that Uber prices were about 36 percent less than the estimated fare for a taxi, and that passengers in Ottawa waited between 5 and 15 minutes for a traditional taxi, but less than 4 minutes for an Uber driver.
• The cost of a single taxi plate in 2012 could be as high as $360,000 in Toronto, according to the same report. The report also found that since ride-sharing services were introduced in Toronto, the price of taxi plates declined to $188,235 in 2014.
• The City of Montreal has seized almost 200 vehicles since the beginning of 2015 for allegedly engaging in illegal ride-sharing, according to media reports. Between October 2014 and August 2015, the City of Ottawa laid 142 charges against unlicensed drivers believed to be working for Uber and the City of Toronto has laid 208 charges against 104 Uber drivers between 2012 and 2015.

Quote

"The arrival of ride-sharing services presents an important opportunity for regulators—an opportunity to inject increased competition into the taxi industry by creating a single, level playing field for all. Consumers would benefit from competitive prices on a variety of innovative choices, while all service providers would have an equal chance to compete."

John Pecman,
Commissioner of Competition

Related Information

• White Paper: Modernizing Regulation in the Canadian Taxi Industry (November 2015)
• Backgrounder:  Recommendations for regulating the Canadian Taxi Industry (November 2015)
• Competition Advocate: Taxi industry's emerging digital dispatch services (November 2014)
• Submission by the Commissioner of Competition Provided to the City of Toronto Taxicab Industry Review (February 2014)
  

The Competition Bureau, as an independent law enforcement agency, ensures that Canadian businesses and consumers prosper in a competitive and innovative marketplace.

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