Blog: Licensing law must move with the times to regulate taxi booking apps



Michael McDougall

Michael McDougall  says licensing law must keep pace with developments in the provision of taxi services.

Taxi and private car hire booking apps are catching on fast so ordering your next taxi by phoning the firm’s office could soon be a thing of the past. Booking apps fundamentally change how customers’ book and pay for taxi and private hire services.

Gett launched in Scotland earlier this year and both Glasgow and Edinburgh have recently granted Booking Office Licences to Uber which means the company has permission to operate as a “premises” for the purposes of taking bookings.

However, there is a serious mismatch between the current legislation, Civic Government (Scotland) Act 1982 (Licensing of Booking Offices) Order 2009, and the type of operation required in today’s smartphone-focussed society to ensure appropriate licensing is in place to protect customers and drivers.

Traditionally, bookings have been placed by the customer phoning the booking office, where an operator takes the details and radios out the booking to a driver. The existing regulations licence a “premises”, thus the booking of a taxi or private hire car is regulated by conditions attached to that premises.

For example, some licensing authorities require the details of the bookings taken to be recorded, such as the name of the customer and the taxi/private hire car driver, and a record kept of taxis/private hire cars operating from the premises. In short, steps must be taken to ensure that passenger safety can be monitored by the police and the authorities. In addition the aforementioned records play a role in helping the police detect organised crime.

Web-based companies such as Uber, connect passengers to a background checked driver via a smartphone app and the firm take a percentage cut of the fare. Therefore, the back office systems of taxi booking apps are not tied to a premises, instead they operate in “the cloud” - a concept completely alien to the current regulations set up in the ‘80s.

The law needs to keep up with changes and various stakeholders, including licensing authorities and police, have lobbied the Scottish government to revisit the taxi/private hire car licensing provision in the wake of these apps. However, regulating these new businesses has caused some tension.

In the recent debates surrounding the Air Weapons and Licensing Bill, the Scottish government have committed to reviewing both the 1982 Act, and the Booking Office Regulations to ensure that they are fit for modern Scotland.

In the meantime it is important that taxi operators review their booking system and ensure that it complies with legislative requirements.

  • Michael McDougall is a solicitor at Lindsays, you can view his profilehere.