Mobility revision passes committee stage at Assembly

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Mobility revision passes committee stage at Assembly

A revision that would make van-hailing service Tada illegal passed the National Assembly’s transportation committee on Friday.

The approval is a big step toward outlawing the contentious service that Korea’s taxi industry claims is already breaking the law. The revision bill will now be passed on to the plenary session at the National Assembly.

If it passes that final step, Tada will have to stop all of its services within one and a half years, or change its business model to fit the revised law.

Tada’s current business model is based on a clause in the domestic transportation services law that allows 11-passenger vans to be rented with drivers - an exception to a general ban on unlicensed operators offering paid ride services.

The revision will eliminate that clause for good, leaving no legal basis for Tada’s operation. Instead, renting vans with drivers will be allowed for tourism purposes only and users will have to rent the van and driver for at least six hours. Pick-ups and returns will be confined to airports and ports.

Users may have to show evidence to prove they are tourists, such as plane tickets. In other words, it will be impossible for Tada to operate as the van-hailing service it currently is.

IT-based ride operators like Tada will also be obliged to pay “contributions” per vehicle - essentially some kind of fee that will fund initiatives to help the local taxi industry.

This is an apparent win for the domestic taxi industry, which argued that Tada’s “illegal” business model was taking advantage of an exceptional clause originally intended to serve the tourism industry.

Socar CEO Lee Jae-woong immediately expressed his disappointment in a Facebook post on Friday.

“I’m at a loss for words,” he said. “Discussions on the revision bill were centered on the protection of the taxi industry without consideration of people’s convenience or future industries.

“How does blocking mobility [services] benefit the people? At a time when people don’t even carry passenger tickets, it’s questionable whether this bill, passed in such a rough-and-ready manner, can really properly function in the future.”

Although the transportation committee’s Friday decision isn’t a final ruling, bills that pass this stage are rarely turned down, unless there’s fierce disagreement along party lines.

Lee’s claims that it’s been a “rough-and-ready” legislative process because of the speed - the revision was selected for a vote on Thursday and then immediately voted on the next day. The regular session of the National Assembly closes on Dec. 10.

The Transport Ministry is pushing for a rapid final approval. The revision bill not only regards Tada but a list of other reforms aimed to mediate the lengthy dispute between the domestic taxi industry and ride-hailing services.

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