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Quebec tables bill that would force Uber drivers to pay for taxi permits

Taxi drivers demonstrate outside the Premier's office as the cabinet meets at the Quebec Legislature, in Quebec City on Wednesday, May 4, 2016. The taxi industry is putting pressure on the government to ban Uber and other ride-sharing companies from their industry.

Jacques Boissinot/THE CANADIAN PRESS

Controversial ride-hailing company Uber Technologies Inc. could pull up stakes in Quebec after the provincial government introduced legislation that would force its drivers to pay for taxi permits.

Quebec's Liberal government tabled a bill on Thursday requiring all remunerated passenger transportation services to operate using a taxi permit or face fines as high as $5,000. Companies could be on the hook for up to $50,000. The goal is to enforce a single taxi regime for the province.

"We can't have amateur [drivers] at the same time as professionals," Quebec Transport Minister Jacques Daoust told reporters in Quebec City. He said the draft law would protect Quebeckers by offering them more secure transportation while levelling the playing field for companies vying for their business.

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Uber officials have threatened to decamp from Quebec in the past if Mr. Daoust forced the company inside the confines of the regime regulating the traditional taxi industry. They've argued that ridership numbers prove consumers want their service and that the government should try to find a way to regulate it without terms that would destroy the business model.

"If you ask our drivers to pay to work, whether it's $250 per week or $100 per week, they won't come," Jean-Nicolas Guillemette, Uber's top executive in Quebec, told 98.5-FM Radio Thursday. "That will kill the model."

Quebec's decision highlights the difficulty Uber is experiencing securing legitimacy around the world. Lawmakers, meanwhile, have had trouble trying to balance citizen demand for the kind of disruptive technology Uber brings with the concerns of established commercial players. In Canada, municipalities have struggled to find the best way to regulate Uber with some, such as Ottawa, opting to legalize the service while others, such as Mississauga, instituting an outright ban on private vehicles-for-hire.

Quebec's taxi industry, whose members have disrupted traffic in noisy anti-Uber protests in Montreal and Quebec City, welcomed the proposed legislation.

"Minister Daoust has truly imposed a single regime," said Guy Chevrette, spokesman for the Quebec taxi coalition. Uber is an "arrogant" foreign company that has ridden roughshod over the rules that apply here and threatened the livelihoods of thousands of taxi drivers, Mr. Chevrette said.

Business groups were much less favourable to the government's position.

Montreal's Board of Trade said while the proposed legislation clarifies the rules under which the taxi industry can operate, it fails to recognize the innovation occurring in transportation and reinforces the existing permit quota system that's at the root of dissatisfaction with traditional taxi companies.

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"The most powerful motor for innovation remains competition," Board of Trade president Michel Leblanc said in a statement. "This bill seems to impose a unique model whereas innovation is nourished by the existence of numerous models."

The Fédération des chambres de commerce du Québec, which represents 140 chambers of commerce throughout the province, echoed that view, saying that by declining to create a regulatory framework allowing services such as Uber to exist, the government is turning a blind eye to new and innovative ways of providing taxi-type services to the public.

A spokesman for Uber Canada said the company was studying the bill and would share detailed comments in coming days. A final decision on whether to pursue operations in Quebec hasn't been made, he said.

Uber works through an application downloaded on a smart phone, which links drivers offering rides with people seeking to get somewhere. Drivers typically offer their services as a way to make some extra money to supplement other work. Users, who typically pay for the service with a credit card kept on file, like the service in part because it eliminates monetary transactions with drivers. Trip prices are typically cheaper than regular taxis but can climb quickly if demand vastly outstrips the available supply of cars on the road at any one time.

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About the Authors
Quebec business correspondent

Nicolas Van Praet is Quebec correspondent for the Report on Business. He joined The Globe and Mail in 2014 after eight years at the National Post, where he covered the North American auto industry crisis and several other major stories. More

Quebec Business Correspondent

Bertrand has been covering Quebec business and finance since 2000. Before joining The Globe and Mail in 2000, he was the Toronto-based national business correspondent for Southam News. He has a B.A. from McGill University and a Bachelor of Applied Arts from Ryerson. More

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