Member Article

CMA backs Uber in London taxi row

Taxi app, Uber has won backing from the head of the UK’s competition watchdog in its fight against Transport for London’s (TfL) proposals to clampdown on its services, following a row with black drivers over the company’s operations in the capital.

In September, TfL revealed plans to restrict taxi app companies, including Uber, by introducing a ‘five minute rule’ for pick-ups.

Writing in the Financial Times, Alex Chisholm, chief executive of the Competition and Markets Authority, raises concerns that the proposals “would artificially restrict competition, curbing developments that stand to benefit the paying passenger”.

“New taxi business models have the potential to increase choice and deliver what passengers want: shorter waiting times, lower prices and increased responsiveness,”

He added: “But the proposed rules would undo much of what is novel about these businesses.”

“The guiding principle of a competitive market is that the consumer is in the driving seat.

“If many consumers decide to share rides with strangers in return for lower fares, the market for point-to-point transport could be enlarged, while the traffic congestion generated by each passenger’s journey could be cut.

“But the proposed restrictions would deny consumers the opportunity to make that choice.”

“We’re fully supportive of new technology and business models that widen choice for Londoners.”

“This is how innovation leads to progress. We do not serve the interests of the public or the wider economy if we slam on the brakes,”

In response, TfL’s chief operating officer said it was “fully supportive of new technology and business models that widen choice for Londoners”.

“It is precisely why we are taking these steps to update regulations that were written in 1998.

“These are proposals to adapt to a very different context to when these regulations were written, and we are committed to hearing all views on the range of potential changes.”

This was posted in Bdaily's Members' News section by Ellen Forster .