Six years after ride-hailing first took off here, private-hire car operators will now be licensed under a new law passed by Parliament yesterday, and they will need to meet safety requirements similar to those for taxis.

Taking effect in June next year, the licensing scheme will differentiate operators by the services provided, rather than vehicle type.

Operators can apply for two licenses next February - one for street-hails, where drivers look for passengers to pick up, and another for ride-hails, where the ride is booked in advance.

Opening the debate on the Point-to-Point (P2P) Passenger Transport Industry Bill, Senior Minister of State for Transport Janil Puthucheary said the new law seeks to regulate the operators, with vocational licensing for drivers already in place.

Since ride-hailing platforms first arrived here in 2013, the commuter experience has significantly improved, Dr Janil said.

About 6 per cent of all journeys are completed on taxis or private-hire cars, and of these 276 million trips, more than two-thirds were ride-hails.

But Dr Janil warned that the benefits of P2P transport can be easily lost without sufficient regulatory oversight.

For example, operators could compromise safety at the expense of profits, or lock drivers into exclusive contracts, affecting market contestability and raising prices.

"The (new) framework aims to protect the safety and interests of commuters and drivers, while facilitating an open and innovative P2P sector," he said.

Under the regime:

• Only operators with more than 800 vehicles need to be licensed. Smaller operators are exempt but have to meet basic safety standards.
• Operators providing both street-hailing and ride-hailing need to hold separate licenses.
• Carpool operators will be given a sub-class of ride-hail licenses.
• Operators can be sanctioned if their drivers commit too many accidents or offences.
• All private-hire cars will need to go for annual vehicle inspections.
• Exclusive arrangements preventing drivers from switching platforms will be prohibited.
• LTA will adopt a light regulatory approach towards service standards, and will remove taxi availability standards.
• Licensed operators need to provide LTA with trip and driver-related data.
• LTA can also issue codes of practice for licensees.
• The Public Transport Council will have powers to ensure that fares are clear, and for flat fares, provided upfront.
• Fare evasion and overcharging offences will be extended to private-hire car trips.

Both Grab and Go-Jek were supportive of the Bill's intention to protect commuters and keep the market open.

"Gojek is committed to a long-term presence in Singapore and we look forward to working closely with the Government to shape the future of the industry," said its spokesman.

Grab said it will continue to advocate for child-seat requirements in all vehicles.

It also called on LTA to address the issue of taxi operators restricting drivers from taking fixed-fare jobs on other platforms as soon as possible.

This article was first published in The New Paper. Permission required for reproduction.