By: Devin Woolf
On September 15, 2015 the Massachusetts Joint Committee on Financial Services heard four different proposed bills regarding Transportation Network Companies. The proposed bills all had one objective in mind, to regulate the commonly used ride-sharing services in Massachusetts such as Uber and Lyft.
The proposed legislation seeks to protect passenger and to regulate the ride sharing-services similarly to traditional drivers. Bill H3351 proposed requiring background checks for Uber and Lyft drivers. The goal of the background checks is to create a database of all drivers and their motor vehicles that can be shared with law enforcement. Bill H3720 went a step further and proposed finger printing along with national and state background checks. Visible, removable decals on vehicles were also suggested throughout most of the presented legislation.
The debate over how to regulate the ride-sharing services has raised many legitimate concerns including; gaps in insurance policy coverage where driver’s personal policies do not cover driving for commercial purposes, discrimination against those who are unable to use the services due to disabilities and special transportation needs, and the lack of transparency of calculating surge pricing. “Surge pricing” is a result of high demand for drivers in a particular neighborhood. The price for a ride “surges,” incentivizing other drivers to get on the road and increase the number of vehicles, which as a result should lower prices and wait times. Although many critics say the surge prices are being manipulated.
Start-up companies are helping to solve the transportation needs of the Commonwealth. Being able to request a ride through an app is quick and efficient and gives the consumer greater choice in deciding his or her mode of transportation. With all of these benefits of the ride-sharing services, the Committee is faced with a dilemma; how should these technology-driven companies be regulated?
Stories of individuals getting into vehicles they believed to be their Uber or Lyft rides are all too common. Uber and Lyft vehicles are not required to be marked with a decal and this has led to cases where individuals have taken advantage of this confusion and passengers have become victims to crimes. Ride-sharing service drivers could be driving with suspended licenses from other states, because currently national background checks are not required. An Uber or Lyft driver could receive a speeding ticket this afternoon, and continue to pick up passengers this evening.
The ride sharing service companies are great for consumers in the Commonwealth but they also pose a huge risk to consumer safety without regulation. The Committee should keep their number one priority as protecting passengers. Although some fear that too much regulation will discourage technology and innovation, these companies are not leaving Massachusetts. They continue to grow everyday, gaining more users and offering more services. Since ride-sharing services will be here for the long run, it’s important that the Massachusetts legislature makes it clear that they are pro-innovation but also pro-consumer safety.
To view the complete text of the proposed bills see here.
Student Bio: Devin Woolf is a Staff Member of the Journal of High Technology Law. She is currently a 2L at Suffolk Law with a concentration in Business/Financial Services. She holds a B.A. in Political Science and International Studies from Elmira College.
