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New legislation makes Uber legal in ACT

20 November, 2015
By Allison Orr

The ACT government has passed legislation to make rideshare service Uber legal. For the first time in Australia, there is a fully regulated version of the service.

Uber has been operating in Australia for almost two years and has completed 10 million UberX rides, but they were not technically legal. 

The ACT legislation is the first of its kind in Australia, and is intended to level the playing field between Uber and taxi drivers.  Licencing fees for taxis and hire cars will be reduced, while some fees will be imposed on the ride sharing operators. Uber drivers will still not be able to pick up passengers from taxi ranks or be hailed on the street like taxis.

It’s not yet known if other states will follow the ACT and enact legislation to legalise Uber.  It’s clear that people like having the choice Uber provides.  A recent attempt by the Victorian Taxi Association to get people to share positive stories about taxi rides backfired.

Uber has become the premier example of a disruptive technology, being both praised for challenging an established oligopoly, but also condemned for taking jobs away from taxi drivers.

Globally, Uber is becoming a kind of test case around challenging existing closed but regulated markets, and also around workers rights in the new sharing economy.

Regulation of the services is proving a challenge for the service in some countries.  In Germany, Uber has suspended services in Hamburg, Frankfurt and Dusseldorf, keeping the service running only in the cities of Berlin and Munich.  This comes after a German court banned Uber from running services using unlicensed cab drivers in March.  The company has since limited itself to drivers that hold passenger transport licenses, and they have run into a shortage of drivers.  For many, the process of registering has become too costly and time-consuming.

Uber has also become a watchword for how workers rights may change in the new economy.  Uber has consistently argued that they are a neutral technological platform that connects up drivers and passengers, and that the drivers are independent contractors.  They don’t pay their drivers benefits or payroll taxes.  But California’s Labor Commission has recently ruled that Uber drivers in that state are employees.

Unions are also finding the situation complicated.  For example, in the US, the Teamsters, the large US union that represents drivers, are now organising the independent contactors who drive for Uber in Los Angeles and San Diego, and they are also working with taxi unions in Washington DC to restrict Uber’s presence in that city.

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