New Taxi Regulations Could Increase Prices For Customers

The Competition Authority (CA) has warned the National Transport Authority (NTA) that proposed new taxi regulations could create a barrier to entry that will increase prices and waiting times for taxi users.

Last week, the NTA launched a public consultation on draft regulations that consolidate and replace more than 50 years of legislation relating to the taxi industry, in addition to introducing some new regulations.

The proposed regulations outlined in Section 13 of the draft Small Public Vehicle (Consolidation and Reform) Regulations 2014 will copper-fasten provisions introduced in June 2010 whereby all new entrants must drive a Wheelchair Accessible Vehicle (WAV). These vehicles are more expensive to purchase and drive compared to standard vehicles. The new regulations also propose that new entrants must drive a WAV that is less than six years old.

The maximum age for existing licence holders is between 10 and 15 years for standard vehicles, while the age requirements for WAVs that are already licensed is to be removed. This increases the financial burden for new entrants and places them at a significant disadvantage compared to existing licence holders.

It is reasonable to expect limited new entry in the current economic environment, where prices are being discounted and the number of taxis has been falling. This means when the economy revives and the demand for taxis increases there will be fewer taxis.

The CA recommends that draft regulations contained within Section 13 should be removed. It also recommends that in order to improve the percentage of WAVs in the market the Government should first prioritise more effective ways to match supply with demand.

(CD/JP)