[By Rob Shaw]
VICTORIA – Ride-hailing companies Uber and Lyft have been approved to operate in Metro Vancouver, paving the way for the major companies to get vehicles on the streets within days or weeks.
The Passenger Transportation Board ruled Thursday that both companies can begin to put cars on the streets in the Lower Mainland and Whistler, subject to obtaining local business licenses and proper insurance from the Insurance Corporation of B.C.
The board also declined a demand from the taxi sector that it set a limit on the number of ride-hailing vehicles, or forbid the companies from using variable pricing.
“The Board has determined that, at this point in time, it is not prepared to impose limits on fleet size because of the experiences of other jurisdictions with Uber’s operations,” read its decision.
Uber said it will start operations “very soon.”
“The PTB’s approval is one of the final steps before Uber is able to start providing reliable, safe, affordable rides in Metro Vancouver,” said Michael van Hemmen, head of Uber’s western division, in a statement.
“We hope to launch very soon, once we have obtained a business licence from the City of Vancouver and purchased insurance from ICBC. In the meantime, we encourage all qualified drivers with a Class 4 licence to sign up on the Uber app at drive.uber.com so they can start earning money as soon as operations begin.”
Lyft also promised quick action on launch.
“Lyft thanks the provincial government and the Passenger Transportation Board for their dedication in establishing the framework to make operations possible,” the company said in a statement.
“We are working to secure our provincial and municipal business licences and will soon announce our operating area and launch service. We are excited to further unlock the city with reliable and affordable rides, allowing for more spontaneity and convenience.”
Lyft and Uber will still have to obtain local business license approval.
Mayors on TransLink’s Mayors’ Council voted last month to have an interim regional municipal business license for ride-hailing companies in place by the end of January, in an attempt to remove a hodgepodge of varying fees and applications from each municipality. That came amid threats from the provincial government that it could remove licensing power from municipalities if mayors opposed to ride-hailing, like Surrey’s Doug McCallum, tried to frustrate licenses in an attempt to block the service.
Vancouver mayor Kennedy Stewart said in a statement that his city could very quickly handle license applications from Uber and Lyft.
“The City of Vancouver is ready for ride-hailing,” he said. “We’ve been working hard behind the scenes to make sure that once provincial regulators approved applicants like Lyft and Uber, our staff can turn around business licenses in three days or less. Now that this has finally happened, all we need is for Lyft and Uber to ask us for a business license and we’ll grant one.”
For prospective drivers, the Class 4 license requirement was part of the NDP government’s approval of ride-hailing, and means would-be ride-hailing drivers must take additional training, steps and security screening.
The board decision comes after multiple delays to ride-hailing and a timeline that far exceeded the original promise of the government.
Transportation Minister Claire Trevena said she will still work with the taxi sector to address concerns in coming months.
“I know people were frustrated and wanted to get them immediately,” she said of ride-hailing licenses during a media conference Thursday. “I was as frustrated as everyone at the time it seemed to be taking. But in the end people of British Columbia can feel very comfortable in the services they are getting.”
The taxi sector had lobbied hard for what it called a “level playing field” with ride-hailing companies – specifically a cap on vehicles and a ban on what it called predatory pricing. Those moves would help reduce the economic impact on its sector as it faced with competing with large companies like Uber and Lyft, the taxi sector argued.
However, the board in its decisions Thursday said negative economic consequences to taxis are simply part of the market adjusting.
Although Lyft and Uber will have to start fares at a set minimum, and forbidden from using coupons or discounts, the companies will be allowed to implement dynamic pricing and “surge” pricing.
“Dynamic pricing is the mechanism by which the supply of vehicles is adjusted to respond to passenger demand,” ruled the board.
“The intended effect of dynamic pricing is to reduce wait times at peak periods by incentivising drivers and to lower costs at off peak periods to encourage trips. The Board does not accept the submission that dynamic pricing is discriminatory in purpose or effect. The price of countless goods and services are dictated by market conditions.”
The board also brushed aside the argument from taxis that its approval, without limits, would decimate the traditional taxi sector and devalue the licenses obtained by operators.
“We live in a market economy and competition is the norm in marketplaces,” read the decision.
“The prospect of taxis losing market share to (ride-sharing) and experiencing declines in absolute levels of ridership can occur as a natural consequence of marketplace adjustment. While the Board is sympathetic to the prospect that taxi licence holders may experience a drop in their licence-share value, it has never sanctioned the market for such shares, nor does it have the authority to do so.
“Taxi licensees created the market and invested in licence shares or used them as collateral. As with any investments, there are associated risks and impacts. The introduction of ride hailing has been a point of public discussion and consultation for approximately seven years. As a consequence, there has been ample notice regarding the possible introduction of ride hailing in this province.”
The board received 29 ride-hailing company applications.
It also announced Thursday it has rejected two companies: ReRyde Technologies and Kater Technologies Inc.
Kater had tried to get an early jump on competing with ride-hailing by partnering with Vancouver taxis to roll out an early app-based hybrid taxi service. However, the board said its application proposals for rates and revenue were not realistic.
“Kater’s business plan indicates basic knowledge and understanding of the regulatory requirements,” read the decision.
“However, the Board finds Kater’s business plan commitments and its 36-month cash projections are incongruous and unrealistic. Its business plan is ambitious; the services it says it will provide and the stakeholder relationships it intends to build do not align with its financial information.”