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DAUS RELEASES REPORT ON SMARTPHONE APPS; FORMS INTERNATIONAL COMMITTEE OF TRANSPORTATION REGULATORS TO DRAFT MODEL REGULATIONS Right now it’s the “Wild West” out there, with private equity backed start-ups and established industry companies alike scrambling to have the next “big App” that will revolutionize for-hire transport internationally. Some Apps operate within the rules by identifying their own licensed transportation companies or affiliates for the consumer, but other 'rogue' apps do not operate on a level playing field. They do this by cutting established dispatch companies out of the picture to deal directly with drivers. Some of these 'rogue' Apps have been and are being investigated by regulators in the U.S. (e.g., Washington D.C. and San Francisco) for operating within legal loopholes, and may run afoul of laws designed to protect consumers. For instance, some Apps calculate fares like virtual taximeters, and have not undergone the rigorous national testing required to ensure that passengers are not being overcharged. Another problem is the use of passenger data of prior trips by drivers who may illegally refuse service to certain persons based on prior gratuities or destinations. One of the most serious issues is the lack of accountability that comes with the licensed business being identified on the Smartphone itself. “Rogue” Apps that refuse to obtain a business license and which do not identify the licensed transportation provider or driver have already lead to passengers being transported by vehicles without sufficient insurance, or by drivers who are unsafe or unqualified (e.g., drivers who have not undergone drug testing or criminal background checks). This danger will most certainly continue. I recently authored and released a white paper report with my law firm, Windels Marx, and its Transportation Practice Group that I Chair, entitled "Rogue" Smartphone Applications for Taxicabs and Limousines: Innovation or Unfair Competition?: A National Regulatory Review of Safety, Accountability and Consumer Protection Legal Issues. To view the report, access the following link: The report is a primer on the different types of technology “start-ups” have been using in terms of Smartphone related applications that allow for the hailing or arranging of a vehicle, removing the dispatch or taxi/limo company from identification when technology companies interact directly with drivers, sometimes without obtaining proper licenses. Many jurisdictions are struggling to understand the operations of these Apps while they roll out into their communities. The report examines how these apps operate, reviews the regulations within several cities across the nation. The following legal issues have been identified as a result of this review:
The report’s release followed a June 26, 2012 announcement made at the New York Legislative Forum "Taxi & Livery Issues of Today & Tomorrow", at which New York State and City legislators discussed the potential benefits and dangers of “rogue” smart phone Apps. The forum was sponsored by Windels Marx, the City University Transportation Research Center (Region 2, NY & NJ) and the International Association of Transportation Regulators (IATR), and was held at Baruch College (NYC). I moderated a panel discussion including:
Senator Martin J. Golden expressed concerns about public safety and indicated that the legislators and the TLC should look into best practices around the world and incorporate provisions that work to allow the use of these Apps in NYC taxicab and livery for-hire industry. Council Member James Vacca expressed his view that, without the proper oversight, smartphone Apps could potentially endanger riders by matching ridership demand with unlicensed drivers or vehicles which is already a concern. Chair Vacca further stated that since smartphone technology is here for the longevity, the proper authorities, including the TLC and the City Council Transportation Committee, should work towards bringing these Apps into compliance with current and new legislation that protects the safety of passengers. Assemblyman Micah Kellner criticized the TLC’s decision to issue a Request-For-Proposal (RFP) for developers of smartphone Apps and commented that the TLC’s action could lead to the introduction of an App that would end up being defunct; however, he agreed that the TLC should wait for the IATR to complete a model regulation and decide if it is still preferable to issue the RFP. There are serious legal and policy issues that must be addressed by regulators. As IATR President, I have asked our government taxicab and limousine regulator members from around the country and the world to join a working group or “IATR App Committee” to help develop a model regulation to ensure ground transportation Smartphone technology can exist fairly, safely and with proper accountability to protect the consumer. I will Chair this regulator only committee which is in the formation process and which so far includes Commissioners and/or high-level government technical staff from the following key cities:
We will be moving quickly to ensure that our regulations keep up with and/or “catch-up with” evolving technology which can allow environmental benefits as well as convenience and efficiency improvements for the consumer. However, this job must be done right – and “Right Now!”
© 2013 TLC Magazine Online, Inc. |
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