CCTV-NEWS：赵克锋：CHINA SHARING ECONOMY

相关链接：http://english.cntv.cn/2016/07/29/VIDEyjAlDicQiKcSx7HnXYv9160729.shtml

Q1 What is your take on the new the car-hailing industry rules?
The rules essentially legalise ride hailing platforms, removing longtime regulatory uncertainty in China.  The rules are much less restrictive than the market had anticipated, especially towards the roles of private cars and car-pooling. The winners are clearly ride-hailing platforms and customers but the losers are arguably traditional taxi companies.
On the international level, whether other countries will follow suit is an interesting thing to follow as this is one of the first major economies that legalise ride-hailing platforms at the country level.
On the local level, it sets an example about how the government mediates the relationship between the market and the government.  The high franchise fees and rigid pricing system of taxi companies have long been attributed to the deteriorating salaries of taxi drivers and poor service offered.  This time the State Council calls for gradually phasing out taxi franchising fees. This could imply that the traditional taxi industries will be transiting towards newer models such as online booking platforms in order to break even. Whether they could compete with existing online giants is an interesting issue especially the new rules now clearly specify more anti-competitive restrictions that prevent predatory pricing, companies will not that easily thwart competition by offering extremely low prices. One bottomline has always been safety. The rules do require drivers to have three years’ experience  and more rules are bound to follow towards better safety requirement. With a better legal identity, the platforms could work with insurance companies to offer more tailored made insurance plans soon. What remains to be seen is how easy it is to obtain the permit required by private cars to offer such services.
Q2 How does it line with more macro national goals?
The rules don’t appear to impose any obvious burdens on such online platforms or drivers that would severely damage the emerging business models already dominated by the large players. The rules have not specified much restriction about car pooling. The Central government clearly delegates the car-pooling regulation to the local governments.  The government is once again doing experiments at the local government level whenever there are great uncertainties surrounding a policy. From housing, car license plates to the current online car booking issue,  I think experimentation is a good approach to understand what the new market has to offer, especially about how it could be in line with two key elements, namely, green and innovation of the 13th Five Year plan.