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Thursday, July 28, 2016, 22:02

China legalizes car-hailing services

By Agencies

China legalizes car-hailing services
A customer checks a car-hailing service app on his smartphone on Oct , 2015. (P hoto/China Daily)

BEIJING - China unveiled its first nationwide regulation on car-hailing services Thursday, granting legal status to the industry.

A document released by the State Council, China's cabinet, featured guidelines on the registration and operation of car-hailing companies.

Previously, firms like China's Didi Chuxing and its US counterpart Uber had operated in a gray area in China, as there is a law against drivers of private cars carrying passengers for profit.

The latest document specifies that car-hailing firms do not need to have their own fleet, effectively allowing private cars to provide such service.

Vehicles and drivers providing online-car hailing services can apply for a license collectively.

Car-hailing companies will be responsible for the qualification of its cars and drivers, the document said.

A provisional rule released by the Ministry of Transport on the same day set out detailed requirements for car-hailing companies and drivers.

Cars are no longer allowed to offer rides after they clock-up 600,000 km or have been in use for eight years, while drivers must have no criminal record related to drugs, driving, alcohol or violence, according to the rule.

On Thursday, Didi Chuxing and Uber said they welcomed the rules and the official endorsement of the industry.

"The rules legalized online car-booking services at the national level for the first time, marking a milestone in China's endeavor toward steady and healthy development of the rideshare industry," Didi Chuxing said in a statement. "We believe the rules will usher in a new stage of growth for China's online ride-booking ecosystem."

Didi Chuxing and Uber's popularity has been a source of ire among taxi drivers who must pay high franchise fees.

About 96.6 million Chinese, or about one in every 14, hailed a taxi via online car-hailing services in 2015, while 21.6 million people booked private cars online, according to China Internet Network Information Center.

Uber, headquartered in San Francisco, operates in more than 60 Chinese cities and plans to increase to more than 100 by the end of 2016.

"We look forward to working with national and local governments to put these regulatory guidelines into practice," said a company statement.

Didi Chuxing, previously Didi Kuaidi, operates in some 400 Chinese cities. It said the company completed 1.4 billion rides in 2015.

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