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Hong Kong authorities have set a cap of 10,000 vehicles for ride-hailing service permits, marking a key step in their long-running effort to establish a regulatory framework, with applicants who have owned a private car for a certain period likely to be given priority.
The news drew criticism from both ride-hailing giant Uber and the taxi trade.
Uber Hong Kong warned that more than 20,000 people would lose a flexible earning opportunity, adding that a lottery-like quota allocation would put the livelihoods of drivers at risk.
A taxi industry representative argued that the quota was set too high and would adversely affect the sector.
In a paper submitted to the Legislative Council on Tuesday, the Transport and Logistics Bureau said the 10,000-vehicle cap was a cautious and appropriate approach to maintaining service standards while balancing road capacity and the broader transport ecosystem.
“After holistically considering the views from various sectors, the travel needs of passengers, the actual capacity of online ride-hailing services, as well as local conditions and industry development, authorities propose setting the upper limit for the number of vehicle permits at 10,000 at this stage,” the bureau said.
It said that under the “driver-vehicle pairing” requirement, ride-hailing would remain predominantly a part-time activity, though compliance costs might encourage some drivers to work longer hours.
Based on an average of six hours of operation and 12 trips per vehicle per day, the bureau estimated that a 10,000-vehicle fleet would provide about 120,000 daily trips, broadly in line with previously surveyed demand of 114,000 trips.
Authorities were also concerned that non-car owners might buy vehicles just to join the ride-hailing industry, and would look at ways to prevent a sudden influx of private cars that might strain the road network.
“We believe that if a selection process is required for permit applications in the future, priority or a higher chance of approval could be given to applicants who have already owned a private car for a certain period,” the bureau said.
The government has proposed an annual licence fee of HK$1.2 million (US$153,163) for ride-hailing platform operators. A vehicle permit valid for up to 12 months will cost HK$1,560, while a driver’s permit, valid for five years, will cost HK$410.
The relevant subsidiary legislation was published in the gazette on Tuesday and will be tabled before the Legislative Council on Wednesday for negative vetting.
Most legal provisions regulating ride-hailing services are set to take effect on August 3 this year, according to authorities.
Platform companies will be invited to apply for operating licences within the third quarter, with the earliest approvals expected by late November.
The bureau added that the remaining regulations covering vehicles and drivers are slated to come into force on August 22 next year.
From then on, all ride-hailing services must use permitted vehicles and drivers, and booking must be made exclusively through licensed platforms.
Operating an unlicensed ride-hailing platform will be illegal.
Under the proposed rules, unauthorised operators could face penalties of up to HK$1 million and one year in prison, while platforms will be fined HK$10,000 if drivers are not the registered owners of their vehicles.
Uber has operated in a regulatory vacuum in Hong Kong for more than a decade, during which competitors Singapore-based Tada and mainland Chinese operators Didi Chuxing and Amap have entered the market.
Amap is operated by Alibaba Group Holding, the owner of the South China Morning Post.
Uber, which is based in the United States, had earlier proposed issuing 30,000 permits, the same number of drivers working with the platform, warning that a limit of 10,000 to 15,000 permits could shoot up booking prices by 70 per cent and the wait time for a vehicle could potentially double.
Uber Hong Kong on Tuesday said the initial quota was “significantly lower” than needed to meet demand from residents and tourists.
“This also means that over 20,000 people will lose a flexible opportunity to earn,” a company spokesman said.
He added that quota allocation should be based on experience, safety and service quality, rather than be determined by a lottery that put drivers’ livelihoods at risk.
“This legislation is just a start. We hope to continue working closely with the government on an efficient allocation framework and a practical review mechanism that allows the system to evolve over time.”
The SCMP has contacted the three other platforms for comment.
Chau Kwok-keung, chairman of the Hong Kong Taxi and Public Light Bus Association, said the quota for ride-hailing was too high, and would harm the sector.
“Our economy is now at a downward spiral, as evident by the night-shift cabbies who have suffered greatly in business,” he said.
Lawmaker Ben Chan Han-pan, however, described the 10,000 cap as pragmatic.
He said authorities might need to draw lots in the event of oversubscriptions, when platform companies prepare to launch next year, with the first batch of permits expected to be issued by the end of this year.
“I believe all the quotas will be taken up by the middle of next year. By then, we can observe the actual impact and data, while the government can assess whether it needs more or fewer quotas,” Chan said. “We have to consider both taxi operators and passenger needs.”
Ryan Ip Man-ki, vice-president of think tank Our Hong Kong Foundation, suggested raising the quota to 15,000, saying a higher threshold for licensed ride-hailing drivers would encourage more to work full-time and boost overall transport capacity.
Ip also warned that frequent adjustments to the quota in the early stages of the regime might create policy confusion.


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Hong Kong transport

Hong Kong sets ride-hailing permit cap at 10,000 under regulatory push

Hong Kong has taken steps to tackle the ride-hailing market’s regulatory vacuum. Photo: Karma Lo

Uber says Hong Kong ride-hailing cap ‘unusual’, insists it’s here to stay

Uber served 1 million international visitors from 149 countries in Hong Kong last year. Photo: Karma Lo

Andrew Byrne says 70 per cent of local taxi drivers also use Uber’s app every day. Photo: Jonathan Wong

Secretary for Transport and Logistics Mable Chan has stressed the importance of “dynamic assessments” to strike a balance when setting the ride-hailing quotas. Photo: Karma Lo

What Hong Kong’s planned ride-hailing regime could mean for your next Uber trip

Hong Kong authorities have begun laying out details on how they plan to regulate ride-hailing platforms such as Uber, Tada and Didi Chuxing. Photo: Elson Li

Platforms will need to keep records covering driver and vehicle information, booking numbers, cancellations, passenger waiting times, fares and complaints. Photo: Karma Lo

How many ride-hailing permits should Hong Kong allow? It depends on who you ask

Hong Kong taxi trade leaders and Uber have both expressed concerns over a looming quota for ride-hailing vehicles. Photo: Jelly Tse

The Transport and Logistics Bureau is expected to roll out a legal framework to govern operators such as Tada and Uber. Photo: Jelly Tse

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Hong Kong

Transport

Applicants who have owned private car for certain period likely to be given priority under new regime


Applicants who have owned private car for certain period likely to be given priority under new regime.


Hong Kong sets ride-hailing permit cap at 10,000 under regulatory push

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Applicants who have owned private car for certain period likely to be given priority under new regime

Applicants who have owned private car for certain period likely to be given priority under new regime