The Toronto City Council met yesterday and one of the items on the agenda was the availability of insurance for “transportation network companies” with the Council mulling over asking the Financial Services Commission of Ontario (FSCO) about those products. Although not named specifically, the recommendation to ask FSCO comes with driver sharing company Uber firmly in mind.
This new approach sees Toronto looking to find ways to make UberX legal within the city, and possibly throughout Ontario thereafter. The city government has previously tried to shut down the drive sharing service, but ultimately failed. It seems like policing UberX drivers somehow and trying to find auto insurance avenues for the service is the next best step.
This will mean the City Council submitting a request for the definitions in the municipal code for of “Taxicab Broker of Limousine Company to be updated. The request will go through to the Toronto licensing and standards committee and will look for the definition to "explicitly provide that technology-based brokerages, including Uber, are within the existing regulatory regime."
A staff report from explained the rise in UberX, saying that the “public has embraced it” despite the service actually being illegal according to authorities.
"Uber's use and encouragement of unlicensed vehicles-for-hire concerns the City, particularly with respect to uncertain insurance coverage and the processes used to screen and manage unlicensed drivers, which pose a risk to public safety."
The staff report urges the City Council to "direct the Executive Director, Municipal Licensing and Standards to review provisions of the Municipal Code related to taxicabs and report back to Licensing and Standards Committee by January 2016 with recommendations to lessen regulatory burden and enhance competitiveness in the municipally-licensed taxicab industry."
The report also recommends City Council direct the Executive Director, Municipal Licensing and Standards "seek confirmation from the Financial Services Commission of Ontario of the approval and availability of insurance products for ‘Transportation Network Companies’ and their drivers that could adequately protect passengers, drivers, and members of the public from risks associated with the operation of ‘Private Vehicles-for-Hire.’"
Taxi workers would still preferably see Uber shut down in Ontario, but the province has warned in August that the service is almost certain to remain. Traditional taxi companies are seeing their business hit by the UberX model that launched in 2014 and allows users to call a driver close by using GPS; these drivers are unlicensed. While Uber is unregulated, taxi drivers are subjected to some of the strictest commercial and traffic bylaws in the country.
“Taxi drivers cannot compete with an unfair, unregulated service which allow part-time drivers to use their personal cars to pick up fares," stated Sajid Mughal, president of iTaxi Workers, in a Toronto Taxi Alliance press release Sept. 16.