Beijing Publicizes More Supervision of Digital Ride-Hailing Industry

On Monday evening, a coalition of eight Chinese governmental departments jointly revised and issued a notice regarding the strengthening of supervision over online ride-hailing services. The official bodies included China’s Ministry of Transport, the Ministry of Transport, the Ministry of Industry and Information Technology, the State Administration for Market Regulation and five other departments.

The notice requires online car-hailing platform companies to refrain from employing drivers and vehicles that have not obtained the corresponding taxi license. Companies are required not to infringe on the rights and interests of drivers or passengers and not to engage in price dumping. Companies also have to transmit relevant data and information lawfully to the state-run online car-hailing information interaction platform in a timely manner.

In addition, according to the notice, car-hailing companies that become involved in serious legal violations should make make corrections in due course. If a company fails to do so, relevant departments of cities at the prefecture level and above may organize and launch joint supervision after the case being reported to the local government for approval. Departments will report them to take disposal measures such as ordering the suspension of services.

Chinese regulators have carried out large-scale inspections of the ride-hailing industry since last year to regulate the development of the industry. According to domestic commercial inquiry platform Tianyancha, ride-hailing giant Didi has faced a total of 1,733 administrative penalties since 2021. Most of the punishments are for the illegal act of employing drivers who have not obtained a taxi driver’s license to provide operating services. The cumulative fines exceed 10 million yuan ($1.57 million).

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The continuous supervision shows that the transportation department will explore the establishment of a multi-party collaborative governance mechanism involving government departments, enterprises, practitioners, passengers and industry associations. Regulators also will strengthen emergency response, explore innovative supervision methods using the internet, realize information exchange, resource sharing, and improve supervision efficiency.